Business to Africa and Middle East remains buoyant

Fair forecast or foul is the question being asked in the hard-pressed international perishable export market, another victim of the recession-dented trade arena. “The export of perishables has certainly not been recession-proof in 2009,” Mike Froy, divisional CEO of Grindrod PCA (Perishable Cargo Agents), a major muscle in the SA perishable forwarding market, told FTW. “Volumes have dropped per product-type, primarily due to the recessionary conditions in Europe, our major trading partner. The most severely affected commodity has been flowers – as this is regarded as discretionary spend. “Even luxury products like lobsters and abalone (perlemoen) are starting to taper off as demand is waning.” Also crabbing-up the market is producers holding back on production as prices are very low at present in the main markets – of which Froy rated the Far East as “by far the most significant” importer. “However, on a positive note,” he added, “business into Africa and the Middle East remains buoyant. Thankfully, our volumes into these important markets have remained only marginally less than the corresponding period last year.” Froy felt that everyone – be they in the domestic market, imports or exports – was feeling the pinch. “The domestic market,” for example, “has seen quite a noticeable swing away from airfreight to roadfreight, due to the significant difference in price between the two modes of transport.” On the shipping side of things, it’s been a pretty consistent season for MSC, according to Cape Town branch manager, and perishable shipping specialist, Mike Economou. “We’ve been doing fine,” he said, “and from our point of view it’s been a fairly good season. I suppose it all depends on seasons and markets.” In MSC’s case, the main perishable export market is Europe. “For us, it has gone well,” Economou added. “We’ve certainly had to market harder to sell our volumes, but we have set ourselves up well in that marketplace to face the future.” Although he noted that the US demand was a bit down, he was encouraged by a good and stable volume into the Middle East, a market where he shares Froy’s enthusiasm. “Our direct calls at the Port of Jebel Ali mean that our transit times give us a big boost, and volumes are constantly high.” What the state of the prices in the market have been remains very much a producer’s secret, Economou added, but it’s certainly been a tough year for everyone. “However,” he said, “for us moving the cargoes, the perishable products have remained fairly constant. “We’ve also been able to maintain good schedule integrity, although there have been the occasional wind problems. But then that’s always there. “Overall, tight times – but we have fared well in these arduous market conditions.”