Business Maverick

TRADE DISPUTE

SA citrus farmers feel the squeeze after EU detains more than 1,000 containers of produce

SA citrus farmers feel the squeeze after EU detains more than 1,000 containers of produce
A worker at the Port of Durban sees off a shipment of South African citrus to the Philippines on 8 June 2021 in Durban, South Africa. (Photo: Gallo Images / Darren Stewart)

South Africa’s citrus association says it hopes the European Union will clear hundreds of containers of produce detained at European ports ‘in coming days’.

Update: In a statement released after 11pm on Wednesday, the Department of Agriculture, Land Reform and Rural Development said that it had “managed to negotiate a settlement that will see clearing of citrus containers stuck in ports of entry in the European Union”. It said it had managed to clear 300 containers and was processing clearance of the remaining containers.

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South African citrus growers are hopeful that the impasse with the European Union (EU) over more than 1,000 containers of produce detained at European ports will be resolved in the coming days.

This is after reports that tonnes of citrus were potentially spoiling at European ports while SA and the EU crossed swords in a trade dispute over health certificates. 

The European market is SA’s most significant, generating more than €1-billion (R16.7-billion) for the country’s citrus industry. 

But even if those containers of citrus are cleared for European markets, that does not solve the bigger fight SA has on its hands to convince EU authorities that local efforts to combat the spread of a highly destructive pest — the false codling moth — are sufficient. It’s a politically charged issue because SA has accused Spain — its biggest competitor — of driving the rule changes.

An estimated 3.2 million cartons of citrus, valued at R605-million, are on the line, which EU authorities had threatened to destroy. SA’s Citrus Growers’ Association (CGA) has warned that this will not only cause large gaps in the supply chain and higher prices for European consumers at a time when the region faces food insecurity due to Russia’s war on Ukraine, but will severely threaten the sustainability and profitability of the SA citrus industry. It said about 140,000 jobs in SA were also at risk, due to the “massively unjustified” potential destruction of millions of cartons of fruit.

In May, the global trade publication FreshPlaza reported that Spanish citrus producers’ income had plummeted by 26% this season, which accounts for a loss of €618-million. 

“In addition, the prices paid to citrus growers in the fields have been very low. In fact, many of the late varieties were paid below 10 cents per kilo,” it quoted the Unión de Uniones trade union as stating.

At the time, the Spanish citrus body Intercitrus accused the European Commission of caving in to pressure from SA, after withdrawing earlier plans to require orange imports from sub-Saharan Africa to be subjected to cold treatment for false codling moth.

‘Intense lobbying’

Fruitnet reported that the proposal was due to be voted on by the EU’s Standing Committee on Plants, Animals, Food and Feed, but it had been shelved after “intense lobbying” by the SA citrus sector, which argued the new regulations would have had a devastating impact on the industry.

Intercitrus said: “Despite the support of Mediterranean countries as a whole, despite the good technical and political work of recent months by the Spanish Ministry of Agriculture and the regional government of Valencia along with the sector, and even despite the commitment expressed in writing to the sector by the Commissioner for Health and Food Safety, Stella Kyriakides — who guaranteed that the treatment would be applied before the start of the commercial campaign in the Southern Hemisphere — the measure has not even been considered.” 

A month later, the regulations were finally published on 21 June, which the CGA called “drastic, and arguably misinformed”, warning that once they went into effect on 14 July, they could result in millions of cartons of citrus headed to the EU being destroyed. 

“Despite objections from a number of countries, including European markets that currently import South African oranges, these new regulations make … extensive changes to the current applicable phytosanitary requirements for citrus coming from South Africa.  

“These new requirements differ significantly from South Africa’s existing rigorous FCM [false codling moth] risk management system, which has been highly effective in protecting European production from the threat of pest or disease, including FCM, over several years and is supported by the results of scientific studies published in international peer-reviewed scientific journals.”

The association said the new regulations required cold treatment, contrary to scientific evidence, making it an “arbitrary, unjustified and unnecessarily trade-restrictive measure”, which accordingly contravenes international requirements for such phytosanitary trade regulations. 

The CGA said SA citrus growers exported 800,000 tonnes of high-quality citrus fruit to the EU every year, with consistently low false codling moth interceptions over the past three years (19 in 2019, 14 in 2020 and 15 in 2021). 

“This is in stark contrast to FCM interceptions from other importing countries, which have been much higher. However, no measures have been proposed against these countries.” 

It said organic and “chem-free” oranges were particularly prone to chilling injury and would be most severely affected, even though no false codling moth interceptions had been reported in the EU on these orange types.

The CGA said the regulations appear to be nothing more than a “politically motivated move by Spanish producers to freeze out southern Africa citrus from the European market”.

Intercitrus accused the European Commission of putting the interests of SA and the EU’s citrus importing countries above the defence of plant health on the continent, and of damaging the precautionary principle that has governed the recent reform of EU plant health regulations.

“We need to know the reasons for this lack of transparency and why South Africa has greater influence over executive decisions than the necessary mitigation of the enormous phytosanitary risk to which European agriculture is subject,” said the Intercitrus president, Inmaculada Sanfeliu.

“We need an answer to a simple question: How are European farmers going to meet the environmental objectives of the community strategy ‘from farm to table’, which implies a 50% reduction in phytosanitary products before 2030, if the EU does not protect them from foreign competition?”


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 Formal dispute

SA has now lodged a formal dispute against the EU over the matter at the World Trade Organization — its first-ever case before the world body.

The new EU regulations require that imports of citrus must undergo mandatory cold treatment processes and precooling steps for up to 25 days, before importation. Certificates will only be issued once that produce has been declared:

  • Properly inspected;
  • Free from quarantine pests;
  • Within the requirements for regulated non-quarantine pests; and
  • In line with the plant health requirements of the EU. 

The new rules are intended to stem the potential spread of the highly destructive FCM. Also known as the “orange moth”, the pest is native to sub-Saharan Africa. 

The United States Department of Agriculture’s Animal and Plant Health Inspection Service has labelled the false codling moth as a pest of “economic importance” to many crops including avocado, citrus, maize, cotton, macadamia, peach and plum. It says moth larvae are difficult to detect once they enter fruit. All stages of citrus fruit are vulnerable to attack.

Deon Joubert, the CGA’s special envoy for market access and EU matters, told Business Maverick on Wednesday that they had been engaging with the agriculture department “on a daily basis” to ensure that the detained containers at EU ports were released on an urgent basis. 

“The department has committed to issuing new phytosanitary certificates that should hopefully result in the majority of these containers being released in the next few days. 

“Our initial estimates indicated that 1,350 containers [floating consignments] would be affected by the implementation of the new EU FCM regulations. Our latest reports indicate that of this amount, 820 containers will be issued new phytos. 

“[The agriculture department’s spokesperson, Reggie Ngcobo,] estimates that of these, only 300 containers have received their replacement phytos. This will hopefully provide relief over the short term to local growers.” 

However, Joubert said this does not resolve the massive ongoing threat to the citrus industry, which is the long-term implementation of the “unjustified, impractical and discriminatory EU FCM regulations” on South African oranges, which will be impossible to implement by the local industry.

The association said that the current impasse had cost South African citrus growers more than R200-million in losses. DM/BM

Gallery

Comments - Please in order to comment.

  • Katharine Ambrose says:

    Hardly a win win situation. As for the destruction of food that’s despicable

    • Rod H MacLeod says:

      Yes, it’s despicable to destroy food. But if you’ve ever tried to import food from the EU into SA, particularly cheeses and processed meats, you would agree that this citrus fruit / codling moth issue is a minor frustration. In any event, this situation arose due to SA growers NOT complying with EU regulatory requirements before shipping.

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