- J Sevenoaks
- Marketing Assignments, PO Box 86299, City Deep 2049
- 1988
The production of litchis is on the increase and with the attractive overseas markets, there is an expectation that more orchards are going to be established. Marketing of agricultural commodities is the cornerstone of a successful agricultural enterprise. This overview of the local market situation may assist the industry to move towards new marketing strategies.
Summary:
Litchi production in South Africa is increasing, with expectations of more orchards established due to attractive overseas markets.
Marketing is critical for a successful agricultural enterprise; this overview focuses on the local market situation to aid new marketing strategies.
Horticultural products had a gross value of R2.4 billion in 1986/7, making it the smallest agricultural subsector compared to field crops and animal products.
The value of horticultural products steadily increased from 1975/6 to 1986/7, outpacing inflation.
Subtropical fruits constitute 8% of all horticultural products by value, ranking as the sixth largest horticultural product both in value and volume.
The market share of subtropical fruits, including litchis, has increased in recent years.
Litchi production remained near 5,000 tons per annum, except for a low yield in the 1984/85 season.
Litchi production growth generally outpaced the consumer price index, though there was a concerning dip in the last two years covered.
In the 1984/85 season, a larger percentage of litchis were sold on fresh produce markets due to a volume drop.
For the 1985/86 and 1986/87 seasons, only 46% of litchis were sold on fresh produce markets, likely due to increased exports, direct sales, or processing.
The price per ton on fresh produce markets grew slower than inflation, a worrying trend.
Four principal fresh produce markets accounted for 88% of litchi volume in 1987/88.
Major markets saw volume growth (Cape Town, Pretoria, Durban, Springs, Port Elizabeth), while Pietermaritzburg declined, and Johannesburg remained constant with a large share.
The overall horticultural sector and subtropical fruit segment are growing, but increased competition calls for new market development.
Litchi growers need to formulate marketing strategies to handle growing volumes and ensure revenue growth.
Alternative distribution channels may help stabilize prices and expand market reach.
The article concludes that growing market share for subtropical fruits is positive but a challenge, requiring thoughtful marketing plans for continued success.