South Africa’s R3 billion berry export revenue threatened
South Africa’s berry industry fears an open-ended strike by workers at state ports operator Transnet may threaten 30,000 jobs in the sector and put a dent in its export revenue of R3 billion.
A third of South Africa’s berry producers who are currently unprofitable now hangs in the balance due to the strike.
Industry association BerriesZA has written to ministers Thoko Didiza, Ebrahim Patel and Transnet executives, requesting urgent intervention in the strike. But on Thursday, the ports operator declared force majeure, citing that the strike would profoundly impact economic activities across all sectors.
Part of its plea is that contingency plans are implemented to ensure that berries move through the ports.
“The open-ended strike has occurred during the peak of the berry export season, which means even a single day of ports not operating will have a significant knock-on effect on the entire berry value chain putting 30,000 livelihoods who depend on the industry at risk as well as millions of rand in export revenue,” Justin Mudge chairperson of BerriesZA said in a statement on Friday.
The local harvesting season, dominated by blueberries, usually commences in mid-September, with peak exports occurring from October through November.
In its 2022/2021 season, the berry industry exported more than 15,000 tons of fruit, primarily to the countries in the European Union and the UK. It expects to contribute R3 billion in export revenue to the local economy for the current season.
Workers at Transnet embarked on a strike following failed wage negotiations after the state-owned rail, port and pipeline entity rejected a 12% and 13.5% increase demanded by the United National Transport Union (Untu) and the South African Transport Allied Workers Union (Satawu), respectively.
Although Transnet assured the industry that it has the situation under control, the declaration of force majeure “clearly shows that the ports authority does not have a handle on the situation,” the association said.
The strike comes as blow to the berry industry, which has already been severely impacted by lingering operational issues at the country’s ports, including aging and out-of-service infrastructure, as well as inefficient systems and staff shortages.
It has also had to contend with delayed shipments because of poor port performance, affecting the quality of berries destined for international markets. In some cases, the product has been rejected, with related rates shooting up to R250 million last year.
“Compounding this problem is a surge in input costs faced by farmers including a hike in fertiliser and fuel prices as well as soaring freight rates,” Mudge said.