Africa-Press – Gambia. The garlic industry’s troubles have returned after a brief glimmer of hope during the COVID-19 lockdown period. And, despite a renewal of the import duties against garlic ‘dumping’ from China, the industry continues to see an exodus of producers.
During the previous two years, garlic reached unprecedented prices, peaking at about R120/kg, but this year prices have returned to pre-COVID-19 levels of about R21/kg.Corrie Bezuidenhout, chairperson of the South African Garlic Growers’ Association, said that before the duties were imposed, Chinese garlic was being “dumped” in South Africa at R2/kg. The duties then increased the price by R19,25/kg.
“This offered the industry some relief initially, but it quickly opened up a gap for Spain, as the higher prices made it more feasible [for that country to export garlic].Since South Africa has a free trade agreement with the EU, Spanish garlic lands without any duties. Consequently, this garlic has flooded our market, killing the local industry.”
Approximately 75% of South Africa’s garlic was imported, with the largest exporter being Spain, followed by Argentina and China.Bezuidenhout said while good-quality garlic produced locally achieved good prices, any garlic that did not meet the quality standards of that being imported struggled to find a market. Typically, only a portion of a crop was of export quality, which meant that the rest needed to be sold at a near loss just to “get rid of the produce”.
Jaco Oosthuizen, CEO of RSA Group, said economies of scale and adverse weather conditions also made it difficult for local producers to compete with imports.
“Neither the limited growing seasons nor the fact that garlic production is highly labour-intensive works in our favour. International players planting in regions that offer longer seasons, and therefore [have] stronger investment [potential] and enhanced labour efficiency, are naturally in a better position than South African producers to generate larger volumes at a lower price.”
Bezuidenhout added that the low prices had pushed larger South African producers out of the industry.
“We see many new entrants try their hand at garlic, but they don’t last long, as they can’t compete with the imports,” Oosthuizen added.