Fresh produce trader Tasneem Brenner from Delft says many people in her area are struggling, so she can't increase the prices. Instead she'll have to absorb the fuel costs, thus give up profit. (Erin Bates, News24)
Cape Town - Almost all the fresh fruit and vegetables in the Cape Town Market are brought in by truck. After Wednesday’s fuel hike South African farmers face higher freighting costs this month, and consumers could see that hitting their pockets.
Uthmaan Rohe is a commission market agent at the Cape Town Market in Epping. Speaking from the trade floor on Wednesday morning he said the fresh produce industry practically ran on diesel.
“Farmers rely on diesel to plow fields,” said Rohe. “Diesel is also the fuel used to bring the produce to the markets as well as the bigger buyers doing the distributions away from the market.”
He added fuel increases “had a complete impact” on the sector, which is already under pressure due to a drought.
The trade floor in Epping is larger than three rugby fields and each of several cold rooms can store up to 56 000 banana boxes.
The market holds stock including tomatoes, butternuts and peppers from Namibia, bananas from Limpopo, potatoes from Gauteng and citrus from farms in the Western Cape. Its trade manager put annual turnover at R1.45bn and emphasised that figure reflected wholesale prices.
Rohe was of the opinion large retailers overcharged consumers for items like potatoes. “There is a complete disconnenct between the farm gate price the producer receives and the price the consumer pays on certain lines."
Rohe encouraged consumers to support their local grocers who bought at wholesale markets, like the Cape Town Market, or buy in bulk themselves. “If they take a little bit of time to find out who their local green grocer is, they’ll be pleasantly surprised by the price and the quality he has.”
Trade manager for the Cape Town Market, Adrian de Villiers, reported between 70 to 80 salespeople were registered to buy stock. He estimated 60% of them sold fresh goods in the informal sector.
One such trader at the market on Wednesday morning was Tasneem Brenner from Delft, who bought from the market about thrice a week. As helpers loaded tomatoes, peppers, potatoes and other goods onto two bakkies for her, she described the impact of food prices in her neighbourhood.
"Many people are struggling in Delft," said Brenner, "so we can’t increase the prices, because people won’t be happy about it." She said that her profits would likely diminish, as her petrol costs had increased.
The cost of fuel added to those factors affecting food prices, another was the drought. Stiaan Huysamen, also a sales agent, said farmers were struggling to plant crops. He added it would be difficult to maintain current food prices and absorb ballooning transport costs.
De Villiers said most of the buyers were currently absorbing freighting costs but how long farmers, agents and grocers could handle the rising cost of fuel – which increased for a third time in 2016 on Wednesday – remained to be seen.
Truck through and through for SA fruit and veg trade
Although rail was once a popular means of freighting goods from around South Africa to the market, it had fallen out of fashion and now proved too time consuming. “That’s why we do truck, through and through,” said De Villiers.
News24 approached both Shoprite Checkers and Pick n Pay to ask how the petrol hike might impact the cost of their fresh produce, and both retailers declined the invitation for on-camera interviews.
Pick n Pay said in an emailed statement, "a rise in the price of fuel does increase the costs we have to manage in getting products to our stores".
"However, it is only one of several input costs, and we always work very hard to mitigate the effect and keep prices as low as possible for our customers.”
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