South African Exports Turn Towards Asian Markets
South African maize and citrus farmers are looking towards Asian markets as an alternative South African export destination. As competition for export produce in Africa increases, demand in Europe and the United Kingdom decreases and power in Asian countries especially China escalates, South African exports to Asia are becoming a more attractive and viable option for farmers. Furthermore, thanks to the geographic location of Asia, the cost of shipping South African export products as well as air freight is comparatively low, compared to Europe and the Americas.
According to the CEO of Grain SA Jannie de Villiers, South African farmers are already meeting with Chinese buyers in order to establish relationships to bolster the movement of export products. China is a massive consumer of grain; in the 2012-13 year China is forecasted to import a massive 7 million tons, according to a US agriculture report. This forecast bodes well for South Africa, who has an export driven trade in grain. The crops have also been excellent over the past few years; the May 2012 harvest was 11 million tonnes compared to the May 2011 harvest of 10 million.
In the past, South African maize export destinations were primarily African countries and South African fruit exports destinations primarily European countries. However, because of great harvests in Zambia and Malawi, demand has slowed down. Furthermore, African countries are generally more cautious of genetically modified crops, which South Africa produces and exports. Considering these factors, the shifting power balance to the East is benefiting the South African export market. The European demand for South African export citrus fruit is also decreasing; currently around 70% of South African fruit exports go to Europe but the numbers are dwindling. Overall, the National Agricultural Marketing Council has identified China, Ukraine, Kazakhstan, Singapore and Malaysia as promising new export markets for South Africa, which will bolster other South African export businesses, such as freight agents South Africa, sea freight and logistics.
