MONTHLY MARKET INFORMATION REPORT: VEGETABLES

Review period: August 2015 to August 2016

Issue: 2016/09

IN THIS ISSUE

1. Price and volume trend analysis ( in accordance of the highest to lowest volumes sold during this month)

1.1 Potatoes

1.5 Carrots

1.9 Sweet Potatoes

1.2 Tomatoes

1.6 Cabbage

1.10 Lettuce

1.3 Onions 1.7 Pumpkin 1.11 English Cucumber

1.4 Butternut Squash 1.8 Peppers

1.12 Gem Squash

2. News: current activities pertaining to the domestic & international fresh produce market

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INTRODUCTION

This report is a review of selected vegetable sales at the Cape Town Fresh Produce Market, the largest fresh

produce market in the Western Cape.

The review will be issued on a monthly basis and will cover trend analysis relating to prices (Rand per ton)

and volumes (tons) of the selected vegetables sold on the market, considered to be of importance due to

the area under production or marketed volumes, however the combination of selected vegetables might

change over time due to relevance.

OVERVIEW OF THE NATIONAL AGRICULTURAL MARKETING INFORMATION SYSTEM (AMIS), OFFERED BY THE

DEPARTMENT OF AGRICULTURE, FORESTRY AND FISHERIES (DAFF)

The Agricultural Marketing Information Systems (AMIS) is a database interface offered by the Department of

Agriculture, Forestry and Fisheries (DAFF).

The main purpose of the Agricultural Marketing Information System (AMIS) is to provide reliable & updated

information to farmers. In order to assist farmers to plan activities relating to production and marketing in a

much informed manner.

Agricultural market information is provided for horticulture, field crops, livestock and industrial products, and

includes the following categories:

marketing prices,

grading and standard information,

annual price trends, and

marketing news (pertaining to the application procedures for import and export permits).

Click on the following website link to access the DAFF AMIS web application, or alternatively go to the web

address: http: //webapps.daff.gov.za/amis (no subscription fee payable to access system). Cell phone user

can send an sms to *120*4040# (charged at standard sms rates)

Please note that prices are updated at 12h00 a.m on a daily basis.

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1. PRICE AND VOLUME TREND ANALYSIS

1.1 Potatoes

Figure 1: Potatoes sales on the Cape Town Fresh Produce Market

REVIEW OF THE NATIONAL POTATOES MARKET: AUGUST 2016

On national average, an estimated at 31 million equivalent bags or 310,000 ton of potatoes (fresh, processing

and seed potatoes) was lost in stock since September 2015 due to adverse weather conditions. This equates to

12.5% of the 2015 record harvest obtained. The majority of volumes were lost from November 2015 to middle

April 2016, when market prices of all potatoes classes and sizes reached record highs (Potatoes SA, 2016).

As from January to August 2016, a total of 12, 5 million equivalent bags were lost compared to the same period

in the previous year. The shrinkage in volumes between January and August 2016, translated to a 16% y/y

decrease. In August 2016, lesser stock was available on national markets compared to the same period in the

previous year, when record levels were achieved. As a result of the excess stock during August 2015, market

prices achieved below R26 per 10 kg equivalent bag compared to August 2016 when a 10 kg equivalent bag

ranged R35 and R47 per 10 kg equivalent bag (Potatoes SA, 2016).

The shortage of potatoes on the national market within different marketing windows was highly influenced by

the El Nino weather system which contributed towards the 81% y/y increase in average market prices (Potatoes

SA, 2016). Monthly average prices were highly influenced by potatoes grades available on the market, which is

evident in the prices differences obtained amongst the top 10% of class 1 medium compared to the rest of the

class 1 medium potatoes (Potatoes SA, 2016).

Limpopo is marketed the largest share of potatoes (± 40%) during August 2016, followed by the Western Free

State (± 35%) and market players such as the Sandveld, Eastern Cape, Eastern Free State, Northern Cape and

smaller planting regions. The information available for the 2016 potatoes planting remains unchanged at 50,000

hectares (Potatoes SA, 2016).

DEVELOPMENTS ON THE CAPE TOWN FRESH PRODUCE MARKET: AUGUST 2016

Stock traded on the municipal market during the month of August 2016, amounted to 8515 tons which equated

to a 2% m/m or 170 tons decrease compared to the previous month. Regardless of the lesser quantities available

on the market, average market prices decreased by 3% m/m or R129 and reached R4145 per ton during August

2016.

On an annual basis, volumes decreased by 8% y/y or 773 tons. Whereas, average market prices increased by

51% y/y or R1394 per ton, compared to the same period in the previous year.

1 bag of potatoes equals 10 kilogram Source: Potatoes SA & Technofresh, 2016

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1.2 Tomatoes

Figure 2: Tomatoes sales on the Cape Town Fresh Produce Market

1.3 Onions

Figure 3: Onion sales on the Cape Town Fresh Produce Market

A total of 2365 tons of onions were sold on the market during August 2016, translating into a 16%

m/m increase compared to the previous month. This resulted in downward pressure of 6% m/m or

R 407 per ton on average prices due to increased volumes.

On an annual basis, volumes are lesser by 7% or 179 tons. Whilst the average price obtained per

ton of onions sold obtained 100% or R3766 per ton more compared to the R3040 per ton obtained

during the same period in the previous year.

Monthly volumes sold increased by 33% m/m or 794 tons compared to the previous month when

2409 tons were sold. This resulted in the average market price to decrease by 23% m/m or R1136

per ton, to an amount of R3793 per ton. Monthly market prices have mostly been on a downward

trend for the most part of the year, regardless of the multiple variations in the monthly quantities

sold on the market ( refer to figure 1.2).

On an annual basis, a similar trend has emerged as market prices has decreased by 20% y/y or

R961 per ton, as a result of a 23% y/y or 590 tons increase in the tomatoes stock available on the

market.

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1.4 Butternut Squash

Figure 4: Butternut sales on the Cape Town Fresh Produce Market

1.5 Carrots

Figure 5: Carrots sales on the Cape Town Fresh Product Market

Carrot quantities sold during August 2016 amounted to 863 tons compared to the previous month in

which 3% or 73 tons more was sold. Average market prices remained on a decreasing trend as from

May 2016, with a further 8% m/m or R276 per ton lesser obtained during August 2016. A possible

attribute could be the seemingly oversupply within the carrot market within the past few months.

On an annual basis, quantities increased by 9% or 73 tons compared to the same period within the

previous year. Whilst the average market price per ton, increased by 78% y/y or R1411 per ton within

the same period.

A total of 1009 tons of butternut squash was sold during August 2016, which is 32% m/m or 243 tons

more than the previous month’s sales. Regardless of the increase in supply, market prices further

increased by 14% m/m or R375 per ton and reached R3137 per ton.

Stock levels during August 2016 increased by 46% y/y or 319 tons, whereas the average monthly

price pitched quite lower by 7% y/y or R243 per ton for the first time since the inception of the 2016

calendar year.

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1.6 Cabbage Figure 6: Cabbage sales on the Cape Town Fresh Produce Market

1.7 Pumpkin

Figure 7: Pumpkin sales on the Cape Town Fresh Produce Market

During August 2016, cabbage volumes sold increased by a further 27% m/m or 135 tons and reach

630 tons in total. The increased supply resulted in continued downward pressure on average

market prices of 12% or R291 per ton during August 2016. Figure 7, depicts the downward trend in

monthly market prices as from May 2016, which is more or less in line with the trend of last year

which peaked during April 2015, where after monthly prices gradually decreased.

On an annual basis, volumes were higher by 25% y/y or125 tons compared to the same period last

year. Regardless of the increased volumes, average prices traded at 32% y/y or R517 per ton more

than the same period in the last year.

Monthly volumes sold on the market increased by 33% m/m or 152 tons to an amount of 617 tons.

The average monthly prices continued to increase by a further 1% m/m to R2206 per ton, regardless

of the increased supply compared to the previous month’s sales.

On an annual basis, volumes increased by 11% y/y or 64 tons, compared to the 553 tons sold during

the same period in the previous year. Average market prices were higher by 32% y/y or R538 per ton

compared to the same period in the previous year.

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1.8 Peppers

Figure 8: Pepper sales on the Cape Town Fresh Produce Market

1.9 Sweet Potatoes

Figure 9: Sweet potatoes sales on the Cape Town Fresh Produce Market

Pepper volumes increased by 49% m/m or 193 tons and reached 592 tons during August 2016. The

increased supply could be a direct consequence of the downward pressure experienced in the month

under review, which amounted to 11% m/m or R1313 per ton.

On an average basis, volumes increased by 12% y/y or 65 tons compared to sales in August 2015.

Whereas, average market prices obtained 50% or R3624 per ton more than average prices which

amounted to R7192 in the same period in the previous year.

A total amount of 337 tons of sweet potatoes was sold during the month of August 2016, depicting

more or less the same volumes in the previous month in which 339 tons were sold. Average market

prices reached R5202 per ton which is 20% or R883 per ton more than the average price obtained in

the previous month.

On an average basis, volumes were lesser by a mere 2%. On the other hand, average market prices

increased by 53% y/y or R1794 per ton, compared to the same period in the previous year (refer to

figure 9).

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1.10 Lettuce

Figure 10: Lettuce sales on the Cape Town Fresh Produce Market

1.11 English Cucumber

Figure 11: English Cucumber sales on the Cape Town Fresh Produce Market

Lettuce volumes sold during August 2016, reached 285 tons. This equates to a 12% m/m or 30 tons

increase in relation to the previous month. Increased supply to the market has resulted in downward

pressure on average monthly prices, and August 2016 was no exception as can be seen by the 12%

m/m or R292 per ton reduction compared to the previous month.

On an annual basis, volumes were 11% or 29 tons higher compared to the same period in the previous

year. On the other hand, average monthly prices were 16% y/y or R695 per ton higher than August 2015.

English cucumber volumes sold during August 2016, reached 226 tons, translating into a 17% m/m or

32 ton increase compared to the previous month. Average monthly prices were further pushed

upward by an additional 59% m/m or R7854 per ton compared to the previous month when it

reached R13306 per ton.

Sale volumes were 45% or 70 tons higher than the same period last year. Whilst the average market

during August 2016 amounted to 13% y/y or R3099 per ton lesser than the R24259 per ton obtained

during the same period in the previous year.

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1.12 Gem Squash

Figure 12: Gem squash sales on the Cape Town Fresh Produce Market

Gem squash volumes have been on a decreasing trend as from June 2016, and have subsequently

decreased by a further 40% m/m or 111 tons to an amount of 166 tons. On the other hand, the

shortage in supply could be a contributing factor to the 75% m/m or R2428 per ton increase during

August 2016, in relation to the previous month when a ton of produce reached to R3222 per ton.

During August 2016, volumes were lesser by 70% y/y or 387 tons compared to the same period in the

previous year. Whereas monthly average prices escalated by more than a 100% more than R1668

obtained per ton during the same period during last year.

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TABLE 1: TREND ANALYSIS OF NICHE VEGETABLES TRADED ON THE CAPE TOWN FRESH PRODUCE

MARKET:

PRODUCE NAME: ( in order of the highest to

lowest volumes sold during

this month)

AVERAGE TONS

TRADED FOR

AUGUST 2016:

(tons)

(A-Z)

CHANGE IN THE

AVERAGE TONS

TRADED FOR

AUGUST 2016:

(m/m)

AVERAGE PRICE

OBTAINED FOR

AUGUST 2016:

(Rand per ton)

CHANGE IN THE

AVERAGE PRICE

MARKETED FOR

AUGUST 2016:

(m/m)

13. Cauliflower 293 >100% R4 169 -32%

14. Green beans 114 -5% R12 992 30%

15. Baby Marrow 131 58% R10 402 -42%

16. Broccoli 95 27% R7 583 -29%

17. Beetroot 93 31% R3 649 -4% 18. Brinjals

/Eggplant 65 7% R7 903 18%

19. Spinach 37 19% R8 636 4%

20. Leeks 33 -10% R3 826 1%

21. Sweetcorn 24 76% R24 038 21%

22. Spring Onion 20 8% R7 315 6%

23. Mushrooms 11.8 32% R45 521 -12%

24. Patty Pans 1.8 >100% R31 845 -9%

25. Radish 1.8 -1% R7 791 14% 26. Hubbard

Squash 1.3 -94% R2 671 5%

27. Marrow 0.01 -100% R12 750 >100%

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NEWS CLIPS: COMMODITY MOVEMENTS BOTH IN THE INTERNATIONAL AND DOMESTIC MARKET

2.1 Manufacturing Competitiveness Enhancement Programme (MCEP) partially opened by DTI, after

temporal suspension late last year

MCEP was initially designed to support enterprises within the production sectors of the economy after the

global economic recession to counter adverse market conditions, to secure higher investment returns,

raise the level of competitiveness and to retain employment. It consisted of the Production Incentive

which is administered by Incentive and Development Division (IDAD) and the Industrial Financing loan

facility administered by the Industrial Development Corporation (IDC) (DTI, 2016).

“The Production Incentive was temporarily suspended in October 2015. MCEP supported 1153 entities to

the value of R7, 2 billion with acquisition of capital equipment and reengineering of business processes to

improve their competitiveness under the Production Incentive, of which R4, 1 billion has already been

disbursed. The programme leveraged approximately R30,8 billion in private sector investment and

retained over 200 000 jobs across all priority sectors. The Industrial financing loan facility which is

administered by IDC, approved working capital loans to the value of R988 million of which 78 % has been

disbursed. A total of 1 553 jobs have been saved and 7 933 jobs have been created through this facility”

(DTI, 2016).

The industrial financing loan facility allows for a re-opening of another window for pre-and post-dispatch

working capital loans, limited to R50 million for each qualifying entity at a fixed rate of 4 % per annum. In

addition, the facility will also provide funding of up to R50 million for plant and equipment to all qualifying

start-up and existing Black Industrialists businesses at the same rate (i.e. 4%) which is payable over a

period of 84 months (DTI, 2016).

More details can be acquired about the MCEP programme information can be accessed online at

http://www.investmentincentives.co.za/mcep or alternatively visit the DTI website at www.dti.gov.za

Source: DTI & Engineering News, 2016

2.2 Responsible use of crop protection products

publication launched by Potatoes SA & Villa Crop

Protection

On 2 August 2016, Potatoes SA & Villa Crop Protection

launched a new best practice publication for

farmers, entitled Responsible use of crop protection

products / Verantwoordelike gebruik van

gewasbeskermingsprodukte. Copies can be obtained

in both English and Afrikaans, by clicking here.

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2.3 Tuta Absoluta (Tomato leafminer)

“Mr Jan-Hendrik Venter of the Department of Agriculture, Forestry and Fisheries’ Directorate: Plant Health

referred to the alarming rate at which the tomato leafminer is spreading southwards in Africa and the

devastating impact it has on tomato production in several African countries. Unconfirmed reports

indicate that the insect has been detected in Mozambique, which means that it basically could be on

South Africa’s doorstep. The tomato leafminer belongs to the same family as the potato tuber moth,

looks almost the same and because it is very small is not easily detected. He added that it is extremely

difficult to control because it quickly develops resistance to chemicals. As far as putting control measures

in place to prevent the insect from causing havoc in South Africa, Mr Venter provided an overview of the

legislation being introduced and actions being taken such as surveillance activities, the registration of

pesticides and limited research. He stressed the importance that all interested role players who have an

Interest in the adverse effect the tomato leaf miner with the emphasis on tomatoes and potatoes, should

have an urgent follow-up meeting in order to establish a steering committee to ensure that the threat

could be addressed pro-actively”. (Potatoes SA CHIPS, July/August 2016).

Also see article: Is the tomato leafminer a threat to the potato industry in South Africa? – CHIPS,

September /October 2015 (Potatoes SA CHIPS, July/August 2016).

2.4 Department of Agriculture, Forestry and Fisheries (DAFF): Agricultural Marketing Information System

(AMIS)

The Agricultural Marketing Information Systems (AMIS) is a web-database interface offered by the

Department of Agriculture, Forestry and Fisheries (DAFF). The main purpose of the Agricultural Marketing

Information System (AMIS) is to provide reliable & updated information to farmers. In order to assist

farmers to plan activities relating to production and marketing in a much informed manner.

Agricultural market information is provided for horticulture, field crops, livestock and industrial products,

and includes the following categories:

• marketing prices,

• grading and standard information,

• annual price trends, and

• marketing news (pertaining to the application procedures for import and export permits).

To access the DAFF AMIS website address go to http: //webapps.daff.gov.za/amis (no subscription fee

payable to access system), or alternatively send a sms to *120*4040# (sms charges apply)

Note: Prices are updated on a daily basis, after 12h00 am.

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2.5 WEATHER UPDATE: DAFF NAC ADVISORY ON THE 2015/16 SUMMER SEASON, AUGUST 2016

The province received below-average rainfall, though some areas indicated above-normal rainfall. As for

monthly mean temperatures, conditions seemed reasonably normal although some areas indicated

above-average conditions. In the Central Karoo drought affected areas remain problematic. Conditions

of winter crops and pastures in the winter cereal production regions of the West Coast, Overberg and

Southern Cape appear to be mixed due to some production areas receiving sufficient rainfall compared

to other areas which received poor rainfall. Thus, some areas indicate that crops are experiencing good

conditions; whereas many other areas reveal crops prevailing under poorer conditions. The average level

of major dams within the Province has decreased to 61% at August 2016 compared to 68% obtained for

the same period in 2015.

Click here to view the most recent update (latest update on 12 September 2016) on the dam levels

within the Western Cape Province or alternatively visit the Elsenburg Website at www.elsenburg.com and

revert to Agri-tools Western Cape dam levels.

In addition, the Agri-outlook report provides a holistic overview of the provincial weather developments

within a specific month. The reports can be viewed on here, or alternatively visit the Elsenburg website at

www.elsenburg.com and revert to the Agri-tools Agri Outlook.

Source: DAFF National Agro-meteorological Committee (NAC) Advisory & Provincial Department of

Agriculture, 2016.

A comprehensive list of strategies can be found in the monthly NAC Advisory report issued by DAFF:

Climate Change and Disaster Management. It can be accessed from the following websites:

www.daff.gov.za and www.agis.agric.za.

Request weather warning notifications from the Western Cape Department of Agriculture: Sustainable

Resource Management, Disaster Risk Management

Forward an email to Mrs. Zaibu Arai to ZaibuA@elsenburg.com or alternatively call (021) 808 5368.

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2.6 MONTHLY FUEL PRICE ADJUSTMENT HAVE BEEN EFFECTIVE AS FROM WEDNESDAY, 07 SEPTEMBER 2016

The following reasons were highlighted for the fuel price adjustments in September 2016:

The average international product prices of Petrol increased, whilst Diesel and Illuminating

Paraffin decreased during the period under review (1 July 2016 till 01 September 2016).

The average ZAR/USD exchange rate amounted to ZAR/USD13.80 for the period 29 July 2016 to 01

September 2016 compared to the previous review period when it reached ZAR/USD14.44.

The strengthening of the Rand against the US Dollar decreased the contribution to the Basic Fuels

Price on petrol, diesel and illuminating paraffin by 23.58 cents per litre, 22.79 cents per litre and

22.86 cents per litre respectively (DoE, Sept 2016).

Product description Numeric

adjustment

applicable to the

Coastal parts in

South Africa

(cents per litre)

Price adjustment description Average price

applicable to the

Coastal parts in South

Africa

(cents per litre)

Petrol 93 ULP 18.00c cents per litre decrease in retail price 1152.00

Petrol 95 ULP & LRP 18.00c cents per litre decrease in retail price 1169.00

Diesel 0.05% Sulphur 48.00c cents per litre decrease in wholesale price 1048.87

Diesel 0.005% Sulphur 49.00c cents per litre decrease in wholesale price 1052.27

Illuminating Paraffin (Wholesale) 47.00c cents per litre decrease in wholesale price 593.03

Illuminating Paraffin (SMNRP) 63.00c cents per litre decrease in the Single Maximum

National Retail price (SMNRP)

828.00

Maximum Retail Price for LPGAS 9.00c cents per kilogram decrease in the maximum

retail price

R6499.96 per metric ton

or 360.75 cents per litre.

( refinery gate)

LPG for residential

customers is derived as

per the control sheet

per kilometre.

Source: Department of Energy, 02 September 2016

Source: DoE, 2016

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ACKNOWLEDGMENTS

The following institutions and organisations are hereby acknowledged:

Department of Agriculture, Forestry and Fisheries: www.daff.gov.za

Department of Energy: www.energy.gov.za

Department of Trade and Industry: www.dti.gov.za

Elsenburg (Western Cape Department of Agriculture): www.elsenburg.com

Engineering News: www.engineeringnews.co.za

Potatoes South Africa (SA): www.potatoes.co.za

Techno Fresh CRM: www.technofresh.co.za

For more information, contact:

The Western Cape Department of Agriculture

Programme: Agricultural Economic Services

Division: Marketing and Agribusiness

Tel: 021 808 5193 or 5189

Fax: 021 808 5210

E-mail: michellesw@elsenburg.com

DISCLAIMER:

This document and its contents have been compiled by the Western Cape Department of

Agriculture. The views expressed in this document are those of the Department of Agriculture with

regard to vegetable market information in the province, unless otherwise stated. Anyone who

uses this information does so at his/her own risk. The Department of Agriculture or the author(s)

therefore accepts no liability for losses incurred resulting from the use of this information.