Season 09/10

Report on the 2009/10 season for Directors Meeting 24 April 2010

The 2010 season has seen a dramatic shift in the focus at Mooigezicht as this year we have chosen to increase our volumes to Canada, the Far East and Asia. This was due to the worldwide economic recession first manifested during the fourth quarter of 2008 and the first quarter of 2009. This resulted in a sluggish demand and decline in food prices. Asia, on the other hand, didn’t feel the effect of the economy crises while grapes are the key item for the Fresh Division in most Asia countries. Supermarkets are 53% of the consumer markets and there is a 16% growth year on year because of a cultural change as the consumers are more health conscience. China’s import fruit market appears to have done well out of the global financial crises, with demand for fresh fruits healthy and prices for grapes and cherries reaching record heights.
At Mooigezicht the season draw to a close to the end of week 16 with small volumes still to be packed for the domestic market only during week 17.

During November we had a 2 week unseasonal spell of cold, rainy weather the effect of which is slightly uneven berry sizes and that reduced the percentage of fruit that qualified for the XL size. At this time this also delayed the ripening process but warm weather during December and January made up for this and the harvest was 7 days earlier than the previous season.

The harvest was lighter on the early seedless cultivars than last year’s harvest. On the Prime, Flame, Midnight, and Sugraone the fertility level was generally lower than last year and there were fewer bunches per vine and the bunches were smaller and the weight less than last season. During the Autumn Royal bloom period we experienced extremely high temperatures and lost about 40%+ of the crop. The mid and latter part of the season saw better than expected yields with the season closing with satisfying results, an improvement on the previous season.

Good weather conditions resulted in producing good quality fruit with very few problems received form the markets. In preparing the fruit we made sure that the optimum crop load per vine was not exceeded that resulted in fruit with better quality, that was mature earlier up to 18 days , good colour and sugars, preferred taste and excellent shelf life.

This year the ZAR is significantly stronger against all the major currencies and this is having a large effect on our returns. In the quest to provide the market with conveniently pre-packed fruit and to add value , we have significantly increased our punnet packing operations by packing 260,000 punnets that included 63 palettes of tri-colour sand 35,000 bi coloured punnets. This included 6 different types of punnet packaging which included 250g, 500g and 750g punnets.

During a visit to our receivers in markets in the Far East last year, it was recommended that Mooigezicht design its own unique carton and brand for this region. We launched the carton during the season and it was the first deciduous fruit carton from South Africa that has been designed and printed with Chinese and Arabic text. We are indeed proud and excited to be packing in this carton for the first time. The first container that arrived in Guangzhou, China, with Crimson was greeted with great excitement and achieved the highest price of the entire season.
The earthquake in Chile on 27 February this year affected large parts of the country as well as the grape production and shipping facilities. This resulted in harvesting and transport delays of at least a week.There had also been a rescheduling of vessels to the market by two to three weeks. This had led to a temporary shortage of fruit from this origin. Markets in Canada, the Far East an Europe sourced fruit to fill these missing volumes and this resulted in an advantageous situation for Mooigezicht. This resulted in an extremely strong Red Globe market to the latter part of the season.

Other than the Volcano eruption in Iceland, which has halted all air traffic for the first time in aviation history in Northern Europe, the breaking news in the produce industry has been the discovery of Chlormequat ( CCC ) on grapes from India. As a result remaining fruit for exports has been stopped from India. CCC is not a life threatening pesticide. The problem is partially an administrative one. This has boosted the hopes for the South African Industry and strengthened the prices of varieties like Barlinka, late Red Globe and Dauphine. Suddenly Dauphine, a yesterday variety, is so strong in demand by exporters and importers resulting in payments up to 50 to 60% more that the last few seasons.

We can look back at a season that we can honestly declare that Mooigezicht and the Hex River Valley has been blessed once again, although there were more that enough factors that negatively impacted on our Industry, most of which we had no control.

I want to thank all of the management and the personnel that tried there best during sometimes testing times but always stayed positive and had a great passion for teamwork.

Francois Rossouw
Managing Director