There has been a revolution in the Kenyan avocado export market, characterized by enormous growth over the past three years. After remaining a relatively small exporter of avocado for a prolonged period, Kenya has now overtaken South Africa to be the leading exporter of avocado in the continent and the seventh largest in the world.
To be clear though, this is not because South Africa is faltering, but Kenya is finally doing what it should have been doing for a long period. Although Kenya has consistently been the continent’s leading producer of avocados, accounting for a nearly 30% share, which is twice the volume produced by South Africa, its export activity was generally marginal. It was only in 2016, when they started to catch up with the likes of South Africa, by generating export revenues of US$64 million from only US$8 million in 2001, according to data from Trade Map.
In the week of 26 April 2019, Kenya took its avocado export drive to new heights by signing a Memorandum of Understanding on sanitary and phytosanitary measures to enable the export of the product to China. This is a big deal because China is an important and growing market in the global avocado sphere ranked as the ninth largest importer in 2018.
China’s avocado imports grew from 4 tonnes in 2008 to 43 859 tonnes in 2018, according to data from the Trade Map. If growth continues over the coming years, Kenya stands to benefit from it. The countries that currently supply a large share of avocados to China are Peru, Mexico, Chile and New Zealand.
Now, China will join the list of Kenya’s avocado export destinations, which include the United Arab Emirates, the Netherlands, France, Saudi Arabia, and the United Kingdom, amongst others.
This brings me to the point of South Africa, which has largely been exporting its avocados to the same countries. Given the new developments in Kenya, perhaps, South Africa should follow the same path and explore the possibility of opening a door for its avocados to China. After all, the growth of South Africa’s avocado market is generally export-led.
Between the 1994/95 and 2016/17 production seasons, South Africa’s avocado output grew by 72% to 77 508 tonnes, according to data from the Department of Agriculture, Forestry and Fisheries. This was underpinned by growing demand from the domestic and global markets. In the period between 1994/95 and 2016/17, South Africa exported, on average, about two-thirds of its avocado output.
South Africa’s leading markets are somewhat an expanded list of Kenya’s avocado destinations. These are the Netherlands, the United Kingdom, Spain, Russia, the United Arab Emirates, Portugal, Russia, Namibia, Turkey, Saudi Arabia and France, which collectively accounted for 97% of South Africa’s avocado exports in 2017 and 2018.
While these markets have served South Africa well over the past couple of years, it would be useful for South Africa to also explore the Chinese market given its enormous growth potential. Moreover, as plantings continue to increase across South Africa, with industry players suggesting that about 1 500 hectares will be added to the current hectarage of 17 500 hectares each year over the next five years, new markets will be needed for the added supply. As a result, market discovery should be allotted the requisite urgency and attention; and it should dovetail with South Africa’s government policy ambition of achieving export-led growth in agriculture.
*Written for and first published on Business Day on 30 April 2019.
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