Table grapes from Peru have been cited as a serious concern for South African peer produce facing an increase in tariffs for fruit heading to the United States.
Coming as it does in the middle of the export season, local table grape exporters are bracing for impact, and some, it seems, are ready for a worst-case scenario – 30% tariffs from August 1.
The South African Table Grape Industry (Sati) has expressed concern, saying local grape exports to the US have increased 65% year-on-year (y-o-y), amounting to 2.2 million 4.5-kilogram boxes in the last export season.
Consequently, Sati has pleaded for fair competition concurrent with Southern Hemisphere competitors.
Peru will remain at 10%, while SA trade negotiators seek to secure a more favourable tariff for the country ahead of August 1.
And while two weeks remain before South Africa shifts into a potentially unaffordable tariff bracket with the US, some exporters are already planning for the worst.
One such producer is Mooigezicht estate in De Doorns.
Managing director Francois Rossouw said they would be able to absorb the impact because the US was not a premier offset destination for Mooigezicht.
In the meantime, Peru is well-positioned to take the game away from its competition. Its agri data portal, Agrarian.pe, has stated that the country’s more than 83m 8.2-kilogram boxes last season heralded a 32.2% increase.
South Africa, in comparison, managed 78.9m 4.5kg boxes.
For Rossouw, this is the biggest threat - the ability of producers like Peru to put so much fruit in the market at the same time as South African exports, absorbing tariff threats from countries like the US through sheer volume versatility.
He told Landbouweekblad that Mooigezicht had noticed in the past how export-shifting by countries like Peru tended to put South African exports in other markets under pressure.
Just because South Africa had alternative markets to the US, which may be a tariff-friendlier destination for Peruvian table grapes come August, didn’t mean the EU and Britain were safer havens for local produce, Rossouw said.
