Industry fragmentation raises concern

An issue of concern raised by several industry experts with this correspondent in the past is the increasing number of exporters – 405 in 2007 from 331 in 2002. This, to Capespan’s Deon Joubert’s mind, does not augur well for the industry – it’s not good for growers but a cause of further fragmentation of the supply side. Of interest is that 80% of the country’s exports were controlled by 29 exporters in 2002, whereas 80% was controlled by 55 in 2007 (Source: FPEF). Joubert argues that Capespan, once with a 100% monopoly of the export trade in SA, has lost market share due to “huge” growth in the industry, greater competition and diversifying into global sourcing to supply customers with yearround product. Indeed, the group still holds between 22% and 28% of overall market share, depending on the commodity.