A PROFILE OF THE SOUTH AFRICAN DAIRY MARKET VALUE CHAIN 2012
Directorate Marketing Private Bag X 15 Arcadia 0007 Tel: 012 319 8455/6 Fax: 012 319 8131 Email:
[email protected] www.daff.gov.za
1
TABLE OF CONTENTS 1.
DESCRIPTION OF THE INDUSTRY
1
1.1.
Milk production areas
1
1.2.
Production trends
2
1.3.
Employment
3
2.
MARKET STRUCTURE
3
2.1.
DOMESTIC MARKET AND PRICES
4
2.2.
EXPORT AND IMPORT OF DAIRY PRODUCTS
5
2.2.
EXPORTS
6
2.2.1. Export values of milk and dairy products 2.3. SHARE ANALYSIS
8 13
2.3.1. Share analysis of milk and dairy products exports
13
2.4. IMPORTS
16
2.5. MARKETING CHANNELS IN THE DAIRY INDUSTRY
19
3.
EMPOWERMENT PLANS BY THE INDUSTRY
21
4.
BARRIERS TO THE LEVEL OF PARTICIPATION BY
21
THE EMERGING SECTOR
21
5.
OPPORTUNITIES AND WEAKNESSES
22
6.
MARKET INTELLIGENCE
22
6.1. Export Tariffs
22
6.2. Import tariffs
29
7.
34
COMPETITIVENESS OF THE DAIRY INDUSTRY
7.1. Exports
34
7.1.1. Milk and cream (neither concentrated nor sweetened)
34
7.1.2. Milk and cream, concentrated or sweetened
40
7.1.3. Buttermilk and yoghurt
46
7.1.4. Whey and other natural milk products
52
7.1.5. Butter and other fats and oils derived from milk
58
7.1.6. Cheese and Curd
64
7.2.
Imports
70
7.2.1. Milk and cream (neither concentrated nor sweetened)
70
7.2.2. Milk and cream, concentrated or sweetened
76
2
7.2.3. Buttermilk and yoghurt
82
7.2.4. Whey and other natural milk products
88
7.2.5. Butter and other fats and oils derived from milk
94
14.2.6. Cheese and Curd 8.
100
ACKNOWLEDGEMENTS
105
3
1.
DESCRIPTION OF THE INDUSTRY
The contribution of milk production in South Africa makes approximately 0.5% to the world milk production. There are four major dairy breeds in South Africa namely, Holstein, Jersey, Guernsey and Ayrshire. The industry comprises of number of different economic activities and significant differences exist between farming methods and processing of dairy products. These activities involve the production and marketing of raw milk, pasteurized milk and cream, fermented milk, long-life milk and cream, yoghurt, cheese and its by-product whey, milk powder, sweetened and unsweetened concentrated milk, butter and butter oil (ghee).
Million Rands
Figure 1: Gross value of fresh milk production 10 000 9 000 8 000 7 000 6 000 5 000 4 000 3 000 2 000 1 000 0 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11
Years Source: Statistics and Economic Analysis, DAFF
The gross value of production for milk is dependent on the quantity produced and prices received by producers. Figure 1 indicates that the gross value of fresh milk has been moving at an increasing rate and reached its peak of R 9.5 million during 2009/10 and decreased by 4.3% in 2010/11. The average gross value of milk produced amounted to R 6.8 million for the past ten years. Although Figure 1 shows a slight decrease in 2010/11 there is still a drastic increase of 114% relative 2001/02. 1.1.
Milk production areas
The coastal areas are more suitable areas for milk production because of mild temperatures as well as good rainfall ensuring good quality natural and artificial pastures. The inland production areas are generally climatically less favourable for milk production. Dairy farming in these areas necessitate intensive and high cost feedlot production systems. Figure 2 shows percentage contribution of provinces to milk production in South Africa in 2011.
1
Figure 2: Milk production per province in 2011 Mpumalanga Others 3% Nort West 4% 5% Western Cape 27%
Free State 13%
KwaZulu Natal 24%
Eastern Cape 24%
Source: MPO
Western Cape contributed 27% of the total milk produced in South Africa followed by Eastern Cape and KwaZulu–Natal which took up 24% each; Free State contributed 13%; North–West 5%; Mpumalanga 4%, Gauteng, Northern Cape and Limpopo shared the 3% 1.2.
Production trends
Over the past ten years the number of milk production and dairy cows has been fluctuating but there is a slight increase of 7% and 14% respectively. This may be due to the uncertainty of the milk industry.
2 700 2 650 2 600 2 550 2 500 2 450 2 400 2 350 2 300 2 250 2 200
1 200 000 1 000 000 800 000 600 000 400 000 200 000 0
Years Production
Dairy cows
Source: Statistics and Economic Analysis, DAFF
2
Number of cows
Million liters
Figure 3: Total milk production and number of dairy cows
1.3.
Employment
The South African dairy industry is important to the job market with over 4 000 milk producers employing 60 000 farm workers and providing 40 000 people with indirect jobs within the value chain like milk processing and milling industry. 2.
MARKET STRUCTURE
The South African dairy market is divided into 60% liquid and 40% concentrated products. Pasteurized liquid milk and UHT milk are the major liquid products, while hard and semi cheese is the major concentrated product. Different types in each category are shown in Figure 4 and 5. Figure 4: Liquid milk products Flavoured Milk 2%
Maas & Buttermilk 5% Yoghurt 13%
Pasteurised Milk 52% UHT 28%
Source: MPO
Figure 4 shows that pasteurized milk has the highest percentages of 52 followed by UHT (long life) by 28; yoghurt by 13; mass & buttermilk by 5 percent. Flavoured milk commanded the lowest market share of liquid milk with 2% share.
3
Figure 5: Condensed milk products
Butter 11%
Milk Powder 19%
Whey Powder 8% Buttermilk Powder 1%
Other Cheese 16%
Condensed Milk 7%
Hard and Semi Cheese 38%
Source: MPO
Condensed milk products consist of 38% of hard and semi cheese followed by milk powder with a percentage share of 19, then other cheese by 16%. Condensed milk and buttermilk powder commanded the lowest shares of condensed milk products with the shares of 7% and 1% respectively. 2.1.
DOMESTIC MARKET AND PRICES
Local milk consumption and prices is illustrated in Figure 6.
2 700 2 650 2 600 2 550 2 500 2 450 2 400 2 350 2 300 2 250 2 200
3.50 3.00 2.50 2.00 1.50 1.00 0.50 0.00
Years Consumption
Source: Statistics and Economic Analysis, DAFF
4
Price
Rands/Litres
Million Litres
Figure 6: Milk consumption and fresh milk price
Figure 6 indicates that milk price increased from 2001/02 to 2003/04 and declined from 2004/05 to 2006/07 before a sharp increase from 2007/8 to 2009/10. The period 2004/05 – 2005/06 experienced the decline in prices as processors were positioning themselves for an expected increase in production but this led to a no growth in production that force processors to review their pricing. Consumption of milk has been fluctuating throughout the period under review and reached the peak of 2.7 million litres in 2004/05. Thereafter the consumption dropped drastically and improved in 2010/11. This was mainly due to under performance of the industry as farmers were withdrawing from the industry which was stricken by economic crisis.
2.2.
EXPORT AND IMPORT OF DAIRY PRODUCTS
Internationally the main milk producing regions are as follows: European Union 31%, New Zealand 30%, Australia 12%, USA 5% and the balance 22% are the cumulative total of the other regions in the world. Milk production in South Africa makes a very small contribution to the world production but in terms of the values of agricultural production in South Africa, it is the fifth largest agricultural industry in the world. Milk is produced much more cheaply in New Zealand and certain parts of the world than in South Africa. Imported milk from the EU and US is cheaper than in South Africa because of subsidies in these countries. Dairy companies in those countries are paid a guaranteed floor price for designated quantities of dairy products. Dairy companies in both countries are given a subsidy to bridge the gap between the supported domestic price and world market price. In the EU dairy farmers are paid subsidies for the use of certain inputs. The annual imports and exports of dairy products (in litres) from 2002 to 2011 are shown in Figure 8.
Figure 8: Exports and imports of milk and dairy products 70
Million Litres
60 50 40 30 20 10 0 2002
2003
2004
2005
2006
2007
2008
Years Exports
Imports
Source: Quantec EasyData
5
2009
2010
2011
Figure 8 showed that South Africa became a net exporter of milk and dairy products during the periods 2002 to 2004 and 2008 to and became a net importer during 2005 and 2007. The increase in exports in 2008 to 2011 was due to the attractive international price of milk. 2.2.
EXPORTS
The dairy industry is also an important earner of foreign exchange. In 2011, exports of dairy products amounted to 44 million kilograms valued at over R 38 million. There was an increase of 24% in quantity and 53% in value of milk and dairy products exported to the world in 2011 compared to 2002. Figure 9 below shows the exports of dairy products from 2002 to 2011.
900
60
800
700
50
600
40
500
30
400 300
20
200
10
Million Rands
Million Kilograms
Figure 9: Exports of milk and dairy products 70
100
0
0
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Years Quantity
Value
Source: Quantec EasyData
From Figure 9, exports of milk and dairy products experienced the lowest exports during the periods 2003 to 2007 before increasing substantially in 2008 and fluctuated during the following years. The decrease experienced in 2010 was due to the low production in the local market. Both quantity and value followed the same trend throughout the period under analysis.
6
Figure 10: Exports destinations for South African milk and dairy products
Angola 10% Zimbabwe 38%
DRC GhanaJapan Republic of 1% 1% 1% Korea Comoros 1% 1% Mauritius 1% Malawi 2%
Mozambique 32% Zambia 5%
United Republic of Tanzania 6%
Saint Helena 1%
Nigeria 0%
Source: Quantec EasyData
Figure 10 shows that during 2011 Zimbabwe commanded a bigger market share of South African milk and dairy products exports accounting for 38% followed closely by Mozambique with 32% and Angola with 10%. The smallest shares of 1% each were commanded by Democratic Republic of Congo (DRC), Ghana, Comoros, Republic of Korea and Mauritius.
25 000
Figure 11: Quantity of milk and dairy products exported by South Africa
Thousand Liters
20 000 15 000 10 000 5 000 0 2002
2003
2004
2005
2006
2007
2008
2009
2010
Years Milk and cream, not concentrated nor sweetened Buttermilk
Source: Quantec EasyData
7
Milk and Cream,Concentrated or Sweetened Whey
2011
Figure 11 shows that milk and cream (concentrated or sweetened) dominated the exports of milk and dairy products and commanded the highest shares from 2002 to 2005, and again from 2007 to 2010. Buttermilk commanded the greatest shares during 2006 and 2011. Butter and other fats commanded the lowest quantities exported during the past years. 2.2.1. Export values of milk and dairy products
Thousand Rands
Figures 12 – 20 shows the export of milk and dairy products from provinces and district municipalities.
450 000 400 000 350 000 300 000 250 000 200 000 150 000 100 000 50 000 0
Figure 12: Value of milk and dairy products exported by provinces
2003
2004
2005
2006
2007
2008
2009
2010
2011
Western Cape 132 152
64 382
39 153
38 059
54 299
68 701
117 280
154 568
117 199
83 627
Eastern Cape
2 467
1 609
3 714
3 768
8 339
16 433
19 619
10 612
18 172
Free State Kwazulu-Natal North West Gauteng
2002 2 064 21
0
0
0
0
0
0
1 665
1 655
2 574
9 652
6 877
6 338
12 556
7 974
7 581
14 527
12 539
9 121
18 868
0
0
0
6
3
298
391
6 841
1 117
3 517
292 358
203 760
189 500
89 300
111 873
130 960
254 610
357 458
281 903
382 278
Mpumalanga
859
1 493
1 146
6 189
25 136
14 042
11 118
3 299
19 448
33 044
Limpopo
62
37
1 270
160
367
1 875
4 525
1 177
28 019
41 539
Source: Quantec EasyData
Figure 13 illustrates that Gauteng province played a major role in the exports of milk and dairy products from 2002 to 2011 with the new peak value of R 382 million in 2011. This may be due to the fact that Gauteng is the main exit point to the SADC region as most of these exports were destined to SADC region. Western Cape Province commanded the second level of milk and dairy products exports followed by Mpumalanga and KwaZulu–Natal provinces while irregular exports were recorded in North West and Free State provinces.
8
Thousand Rands
Figure 13: Value of milk and dairy products exported by Western Cape Province
140 000 120 000 100 000 80 000 60 000 40 000 20 000 0
2002
City of Cape Town 132 059
2003
2004
2005
2006
2007
2008
2009
2010
2011
44 007
30 991
32 767
39 883
48 585
79 168
98 415
112 710
80 818
West Coast
0
0
0
105
500
457
464
1 017
0
310
Cape Winelands
93
20 352
8 158
5 184
13 515
19 659
37 511
54 267
1 530
1 324
Overberg
0
0
1
3
1
0
0
0
0
0
Eden
0
22
4
1
400
0
137
869
2 959
1 175
Source: Quantec EasyData
In Western Cape Province, City of Cape Town metropolitan municipality played an important role in the export of milk and dairy products throughout the period under analysis with the highest export value of R 132 million recorded in 2002. Regular exports of milk and dairy products were also recorded in Cape Winelands district municipality. Fractional exports were recorded from West Coast, Overberg and Eden district municipalities.
Thousand Rands
Figure 14: Value of milk and dairy products exported bu Eastern Cape Province 20 000 15 000
10 000 5 000 0
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Cacadu
2 063
2 460
849
3 687
3 761
5 653
7 468
14 984
9 552
17 514
Amatole
2
0
219
15
1
333
0
0
5
0
Nelson Mandela
0
7
541
12
6
2 354
8 964
4 635
1 055
657
Source: Quantec EasyData
In Eastern Cape Province, high milk and dairy products exports values have been recorded from Cacadu district municipality which commanded the highest values except in 2008 followed by Nelson Mandela metropolitan municipality which reached its peak of R 9 million in 2008. Irregular exports of milk and dairy products were recorded in the Amatole district municipality.
9
Figure 15: Value of milk and dairy products exported by Free State Province
3 000 000 2 500 000
Rands
2 000 000 1 500 000 1 000 000 500 000 0
2002
2003
2004
2005
2006
2007
2008
2009
0
0
0
0
0
0
0
0
Motheo Lejweleputswa
2010
2011
1 281 1082 573 633
20 601
0
0
0
0
0
0
0
0
0
Thabo Mofutsanyane
38
0
0
0
0
29
0
0
146
0
Northern Free State
0
0
0
0
0
0
0
1 664 998 373 935
0
Source: Quantec EasyData
Intermittent values were recorded from Free State Province from four district municipalities (Motheo, Lejweleputswa, Thabo Mofutsanyane and Northern Free State). Northern Free State district municipality recorded a high value of R 1.7 million in 2009 and Motheo recorded the highest values in 2010 and 2011.
Figure 16: Value of milk and dairy products exported by KwaZulu-Natal Province Thousand Rands
1 400
1 200 1 000 800 600 400 200 0
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Ugu
0
0
2
0
14
0
0
63
0
0
Umgungundlovu
29
0
749
1 199
15
5
0
10
1
236
Uthukela
0
21
0
0
0
0
0
8
19
10
Amajuba
0
26
0
0
0
0
0
0
0
0
Uthungulu
1
0
0
1
45
0
0
0
7
0
iLembe
0
15
0
0
0
0
994
786
1 113
0
Source: Quantec Easy data
In KwaZulu–Natal Province, high milk and dairy products export values have been recorded at Umgugundlovu and iLembe district municipalities. Umgugundlovu district municipality commanded the greatest shares from 2002 to 2005 and again in 2011while iLembe district municipality
10
recorded the highest shares during 2008 to 2010. All municipalities (Ugu, Umgugundlovu, Uthukela, Amajuba, Uthungulu and iLembe) recorded intermittent exports of milk and dairy products during the past decade.
Rands
Figure 17: Value of milk and dairy products exported by North West Province 8 000 000 7 000 000 6 000 000 5 000 000 4 000 000 3 000 000 2 000 000 1 000 000 0
2002
2003
2004
2005
2006
Bojanala
2007
2008
2009
2010
2011
0
0
0
5 659
Central
0
0
0
0
0
0
0
0
128 044
0
0
297 525
0
0
0
Southern
0
0
0
0
0
2 517
170
391 436 6 840 50 988 569 3 517 45
Source: Quantec EasyData
Intermittent values were recorded in North West Province from three district municipalities (Bojanala, Central and Southern). Southern district municipality recorded a sharp increase of R 6.8 million in 2009.
Figure 18: value of milk and milk products exported by Gauteng Province Thousand Rands
350 000 300 000 250 000 200 000 150 000 100 000 50 000 0 Sedibeng Metsweding
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2 793
632
69
0
141
1
15
27
14
517
45
0
2
0
0
0
429
67
0
0
West Rand
127
96
1 735
79
79
655
1 050
6 121
1 445
3 153
Ekurhuleni
4 158
8 814
6 486
6 344
8 876
15 401
25 690
39 080
38 399
67 124
City of Johannesburg 282 558 193 269 178 128 82 022 101 756 112 811 223 385 290 881 228 964 284 821 City of Tshwane
2 678
949
3 080
854
1 021
2 092
4 041
21 282
13 081
26 663
Source: Quantec EasyData
In Gauteng province, high milk and dairy products export values have been recorded for the past ten years at the City of Johannesburg metropolitan municipality with the highest values R 285
11
million in 2011. West Rand district, Ekurhuleni district and City of Tshwane metropolitan municipalities also recorded milk and dairy products exports on a regular basis. Irregular exports of milk and dairy products were recorded in Sedibeng and Metsweding district municipalities.
Figure 19: Value of milk and dairy products exported by Mpumalanga Province Thousand Rands
35 000 30 000 25 000
20 000 15 000 10 000 5 000 0
2002
2003
2004
2005
2006
2007
2008
2009
2010
Gert Sibande
99
0
305
534
0
120
0
536
1
2011 0
Nkangala
0
7
0
0
0
0
0
1
84
68
Ehlanzeni
759
1 486
841
5 655
25 136
13 922
11 118
2 762
19 364
32 975
Source: Quantec EasyData
In Mpumalanga Province, Ehlanzeni played a major role in the export of milk and dairy products from 2002 to 2011 and reached its peak new of R 33 million in 2011. Irregular exports of milk and dairy products were recorded from Gert Sibande and Nkangala district municipalities.
Figure 20: Value of milk and milk products exported by Limpopo Province Thousand Rands
30 000 25 000
20 000 15 000 10 000 5 000 0
2002
2003
2004
2005
2006
2007
2008
2009
2010
Mopani
0
0
9
0
0
0
3
0
0
2011 7
Vhembe
62
9
1 076
0
332
1 766
4 522
1 122
7 981
11 028
Capricorn
0
28
184
160
34
109
0
55
3 447
2 409
Waterberg
0
0
0
0
0
0
0
0
16 591
28 095
Source: Quantec EasyData
Limpopo Province recorded minimal exports of milk and dairy products during 2002 to 2011 from Mopani, Vhembe, Capricorn and Waterberg district municipalities. Vhembe district municipality recorded exports regularly and experienced the highest exports during 2002, 2004 and 2006 to
12
2009. Fractional exports were recorded from Mopani, Capricorn and Waterberg district municipalities, Waterberg commanded the greatest shares during 2010 to 2011. 2.3. SHARE ANALYSIS 2.3.1. Share analysis of milk and dairy products exports Table 1 presents the contributions of the various provinces to total exports value for milk and dairy products of South Africa during the past ten years. Table 1: Share of provincial milk and dairy products to the total RSA milk and dairy products exports (%). Years
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Provinces Western Cape Eastern Cape Free State KwaZulu-Natal North West Gauteng Mpumalanga Limpopo Total
30.23 0.47 0 2.21 0 66.88 0.20 0.01 100
23.07 0.88 0 2.46 0 73.03 0.54 0.01 100
16.38 0.67 0 2.65 0 79.28 0.48 0.53 100
25.38 2.48 0 8.37 0 59.54 4.13 0.11 100
26.69 1.85 0 3.92 0 55.00 12.36 0.18 100
29.64 3.60 0 3.27 0.13 56.50 6.06 0.81 100
28.00 3.92 0 3.47 0.09 60.78 2.65 1.08 100
27.74 3.52 0.30 2.25 1.23 64.16 0.59 0.21 100
24.99 2.26 0.35 1.94 0.24 60.10 4.15 5.97 100
14.33 3.11 0.44 3.23 0.60 65.50 5.66 7.12 100
Source: Quantec EasyData
Table 1 show that Gauteng province commands the greatest share of South African milk and dairy products’ exports followed by Western Cape province. This is in spite of the fact that Western Cape and Eastern Cape provinces are the major milk producing provinces. This may be due to the fact that Gauteng and Western Cape provinces are the exit points for milk and dairy products to the SADC regions. Eastern Cape, KwaZulu–Natal, Mpumalanga and Limpopo provinces reported regular exports of milk and dairy products. North West and Free State Provinces recorded intermittent export shares of milk and dairy products while there were no milk and dairy exports from Northern Cape Province. Table 2: Share of district milk and dairy products to the total Western Cape provincial milk and dairy products exports (%). Years Districts City of Cape Town West Coast Cape Winelands Overberg Eden Total
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
99.93 0 0.07 0 0 100
68.35 0 31.61 0 0.03 100
86.09 0.27 13.62 0.01 0.00 100
73.45 0.92 24.89 0.00 0.74 100
70.72 0.66 28.62 0.00 0.00 100
70.72 0.66 28.62 0 0 100
67.50 0.40 31.98 0 0.12 100
63.67 0.66 35.11 0 0.56 100
96.17 0 1.31 0 2.52 100
96.64 0.37 1.58 0 1.41 100
Source: Quantec EasyData
The City of Cape Town metropolitan municipality has commanded the greatest share of milk and dairy products’ exports in the Western Cape Province from 2002 to 2011 followed by Cape 13
Winelands. Fractional exports of milk and dairy products occurred in the West Coast, Overberg and Eden district municipalities. Table 3: Share of district milk and dairy products to the total Eastern Cape provincial milk and dairy products exports (%). Years Districts Cacadu Amatole Nelson Mandela Total
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
99.93 0.07
99.70 0
52.75 13.63
99.27 0.41
99.81 0.03
67.78 3.99
45.45 0
76.38 0
90.02 0.04
96.38 0
0.00 100
0.30 100
33.61 100
0.32 100
0.16 100
28.22 100
54.55 100
23.62 100
9.94 100
3.62 100
Source: Quantec EasyData
Cacadu district municipality has commanded the greatest share of milk and dairy products exports in the Eastern Cape Province. Fractional exports of milk and dairy products occurred in Amatole district and Nelson Mandela metropolitan municipalities. Table 4: Share of district milk and dairy products to the total Free State provincial milk and dairy products exports (%). Years Districts Motheo Lejweleputswa Thabo Mofutsanyane Northern Free State Total
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
0 99.82
0 0
0 0
0 0
0 0
0 0
0 0
77.40 0
100.0 0
0.18
0
0
0
0
0 0 100.0 0
0
0
0.01
0
0 100
0 0
0 0
0 0
0 0
0 100
0 0
100.0 100
22.59 100
0 100
Source: Quantec EasyData
Free State Province experienced fractional exports of milk and dairy products from Motheo, Lejweleputswa, Thabo Mofutsanyane, Northern Free State district municipalities. Motheo district municipality commanded the highest share of milk and dairy products during 2010 and 2011, Lejweleputswa district municipality was the greatest during 2002, Thabo Mofutsanyane district municipality in 2007 and Northern Free State in 2009. Table 5: Share of district milk and dairy products to the total KwaZulu–Natal provincial milk and dairy products exports (%). Years Districts Ugu Umgungundlovu Uthukela Amajuba Uthungulu iLembe eThekwini Total
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
0 0.30 0 0 0.01 0 99.70 100
0 0 0.30 0.38 0 0.21 99.10 100
0.03 11.81 0 0 0 0 88.16 100
0 9.55 0 0 0.01 0 90.45 100
0.17 0.19 0 0 0.57 0 99.07 100
0 0.06 0 0 0 0 99.94 100
0 0 0 0 0 6.85 93.15 100
0.50 0.08 0.06 0 0 6.27 93.09 100
0 0.01 0.21 0 0.07 12.20 87.51 100
0 1.25 0.05 0 0 0 98.69 100
Source: Quantec EasyData
14
eThekwini district municipality has commanded the greatest shares of milk and dairy products’ exports in the KwaZulu–Natal Province from 2002 to 2011. Fractional exports of milk and dairy products occurred in Uthukulu, iLembe, Amajuba, Uthukela, Umgungundlovu and Ugu district municipalities. Table 6: Share of district milk and dairy products to the total North West provincial milk and dairy products exports (%). Years Districts Bojanala Central Southern Total
2002
2003
0 0 0 0
2004
0 0 0 0
2005
0 0 0 0
2006
100 0 0 100
0 0 100 100
2007 0 99.94 0.06 100
2008 0 0 100 100
2009 0 0 100 100
2010 11.47 0 88.53 100
2011 0 0 100 100
Source: Quantec EasyData
Intermittent milk and dairy exports in North West Province were recorded from Bojanala, Central and Southern district Municipalities from 2005 to 2011. Bojanala district municipality commanded 100% shares during 2005 and Southern district municipality has commanded 100% shares of milk and dairy products exports during 2006, 2008 to 2009 and 2011. Table 7: Share of district milk and dairy products to the total Gauteng provincial milk and dairy products exports (%). Years Districts Sedibeng Metsweding West Rand Ekurhuleni City of Johannesburg City of Tshwane Total
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
0.96 0.02 0.04 1.42
0.31 0 0.05 4.33
0.04 0 0.92 3.42
0 0 0.09 7.10
0.13 0 0.07 7.93
0 0 0.50 11.76
0.01 0.17 0.41 10.09
0.01 0.02 1.71 10.93
0 0 0.51 13.62
0.14 0 0.82 17.56
96.65 0.92 100
94.85 0.47 100
94.00 1.63 100
91.85 0.96 100
90.96 0.91 100
86.14 1.60 100
87.74 1.59 100
81.37 5.95 100
81.22 4.64 100
74.51 6.97 100
Source: Quantec EasyData
The City of Johannesburg municipality has commanded the greatest share of milk and dairy products exports in Gauteng province from 2002 to 2011 followed at a distant by Ekurhuleni district municipality. City of Tshwane metropolitan and West Rand district municipalities reported regular exports throughout the period under analysis. Fractional exports of milk and dairy products occurred in the Sedibeng and Metsweding district municipalities. Table 8: dairy products (neither concentrated nor sweetened) to the total Mpumalanga provincial milk and dairy products exports (%). Years Districts Gert Sibande Nkangala Ehlanzeni Total
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
11.56 0 88.44 100
0 0.49 99.51 100
26.59 0 73.41 100
8.63 0 91.37 100
0 0 100 100
0.85 0 99.15 100
0 0 100 100
16.25 0.04 83.71 100
0 0.43 99.56 100
0 0.21 99.79 100
Source: Quantec EasyData
15
Ehlanzeni district municipality has commanded the greatest shares of milk and dairy products’ exports in Mpumalanga Province from 2002 to 2011. Irregular exports of milk and dairy products occurred in the Gert Sibande district and Nkangala district. Table 9: Share of district milk and dairy products to the total Limpopo provincial milk and dairy products exports (%). Years Districts Mopani Vhembe Capricorn Waterberg Total
2002
2003
2004
0 24.96 75.04 0 100
0.75 84.74 14.52 0 100
0 100 0 0 100
2005 0 0 100 0 100
2006
2007
2008
2009
2010
2011
0 90.65 9.35 0 100
0.01 94.18 5.80 0 100
0.07 99.93 0 0 100
0 95.31 4.69 0 100
0 28.48 12.30 59.21 100
0.02 26.55 5.80 67.64 100
Source: Quantec EasyData
Intermittent exports of milk and dairy products were recorded in Limpopo Province. Vhembe district municipality commanded the greatest shares of milk and dairy products exports during 2002, 2004 and 2006 to 2009. Intermittent exports of milk and dairy products were experienced from Mopani, Capricorn and Waterberg district municipalities. 2.4. IMPORTS South Africa is an importer of dairy products. The average import value over the past ten years amounted to over R 561 million and the average quantity amounted to over 31 million kilograms per annum over the past 10 years. Figure 21 present the imports of milk and dairy products from 2002 to 2011.
50 45 40 35 30 25 20 15 10 5 0
1 000 900 800 700 600 500 400 300 200 100 0 2002
2003
2004
2005
2006
2007
2008
2009
Years Quantity
Value
Source: Quantec Easydata
16
2010
2011
Million Rands
Million Kilograms
Figure 21: Imports of milk and dairy products
Figure 21 shows that imports of milk and dairy products fluctuated in both quantity and value throughout the period under analysis. The imports quantity of milk and dairy products reached the peak of over 44 million kilograms during 2007 and the value of milk and dairy products imported reached a new peak of over R 890 million in 2011. This might be due to the weaker South African Rand. Figure 22 below shows the different types of milk and dairy products imported from 2002 to 2011 in terms of quantity.
Million Kilograms
Figure 22: Quantities of milk and dairy products imported by South Africa 16 14 12 10 8 6 4 2 0 2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Years Milk and cream, not concentrated nor sweetened
Milk and cream, concentrated or sweetened
Buttermilk, cream and yogurt
Whey
Butter and other fats
Cheese and curd
Source: Quantec EasyData
Figure 22 shows that milk and cream (concentrated or sweetened), whey and milk & cream (not concentrated nor sweetened) were among the most imported quantities of milk and dairy products in South Africa during the period under analysis. Milk and cream (concentrated or sweetened) commanded the greatest quantities of the imports market in 2002 to 2003 and 2005 to 2007. Milk & Cream (not concentrated nor sweetened) dominated the imports market from 2008 to 2010 and Whey recorded the highest quantities imported during 2004 and 2011. Figure 23 below shows the different types of milk and dairy products imported from 2002 to 2011 in terms of value.
17
Million Rands
Figure 23: Values of milk and dairy products imported by South Africa 400 350 300 250 200 150 100 50 0 2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Years Milk and cream, not concentrated nor sweetened
Milk and cream, concentrated or sweetened
Buttermilk, cream and yogurt
Whey
Butter and other fats
Cheese and curd
Source: Quantec Easydata
Figure 23 above indicate that milk and cream (concentrated and sweetened) and cheese and curd commanded the greatest share of milk and dairy products imported by South Africa during 2002 to 2011. On average Cheese and Curd commanded a share of R 171 million followed by Milk and Cream (concentrated and sweetened)by R 161 million then Whey by R 114 million during the period under review. Figure 24 shows the origin of milk and dairy products imported to South Africa in 2011.
Figure 24: Origin of milk and dairy products' imports during 2011
United States 3%
Australia 5%
Argentina 11%
Uruguay 17%
Germany 7% Denmark 4%
New Zealand 19% France 23%
Ireland 11%
Source: Quantec EasyData
18
Figure 24 above shows that the main supplier of milk and dairy products to South Africa in 2011 was France which had an import market share of 23% followed by New Zealand which exported 19% of milk and dairy products to South Africa then Uruguay by 17%. Argentina and Ireland had an equal share of 11% of milk and dairy products exported to South Africa. 2.5. MARKETING CHANNELS IN THE DAIRY INDUSTRY Milk production in South Africa is mainly by two sectors; Commercial Producers, and Small and Medium size Producers (see Figure 25). Commercial Producers sell milk to Dairy Processors. Small and medium size producers sell most of their milk directly to consumers and some to processors. Dairy Processors buys milk from farmers and import milk concentrates and produces dairy products for primary distribution to retailers, exports and for further processing.
19
Figure 25: Marketing Channels. Commercial Dairy farms
Bulk collection
Dairy Processors
Dairy Products (Cheese, Butter, etc)
Small and Medium Dairy Farms Imports Secondary dairy products
20
Exports
Primary Distribution
Retailers Small and informal trade Institutions
Consumers
3.
EMPOWERMENT PLANS BY THE INDUSTRY
The following is a list of ventures/projects/programmes. Media releases were arranged for the dairy industry. The MPO, in conjunction with the provincial departments and municipalities and other relevant stakeholders were responsible for these empowerment plans. 3.1.
Successful ventures: Commercially viable.
Fort Hare Dairy Trust outside Alice in Eastern Cape started in 2004 and the first cow was milked in October 2007. The trust started between a partnership between 70 white farmers from the Tsitsikamma and the Underberg area – through their company Amandlelo Agri and University of Fort Hare. The University donated land and the cost of the project was R 22 million (R 2 million donated by University, R 5 million by Amandlelo and 15 million by Land Bank of which 7.5 million is loan). The farmers signed on an empowerment company Vuwa Investments which was given 35% stake in the company. The farmers kept 49 % and the rest was shared among 600 workers from the 70 dairy farms. Today Fort Hare Dairy Trust is a state-of-the-art commercial dairy farm. It has 800 cow rotary parlor that produces approximately 10 000 litres of milk a day much of which is supplied to Clover milk company. The farm that requires 600 tons of maize is sourced from farmers in the Alice area. Every year Amandlelo takes between 10 and 15 black interns. Some of them are sent to Fort Hare Dairy Trust. Farmers are rewarded with cattle as they pass through different stages. This will enable them to start their own full time dairy farming (Pretoria News, 17 June 2009). 3.2.
Training Programmes:
3.3.
Agri SETA accredited farm worker training. Agri SETA accredited emerging farmer training. Workers training funded by MILK SA. Training of Extension officers of Department of Agriculture in North West Province and Free State. Magazines:
Ubisi Mail and Dairy Mail are distributed free of charge to emerging farmers. 4.
BARRIERS TO THE LEVEL OF PARTICIPATION BY THE EMERGING SECTOR The low profitability of milk production is the major barrier to entry for the emerging farmers. Access to credit facilities and financial package specially structured to their needs also plays a role. The volatility of the market and the effect of imports in depressing producer prices make it difficult for the emerging farmers to enter the industry. The dynamics of pricing in the dairy industry as well as the shelf life of the products is such that the farmers are squeezed to accept whatever price that the producers/processors offer them to dispose of their products. The market is dominated by 4 major processors in the milk industry making it extremely difficult for the emerging farmers to make inroads in the dairy processing industry.
21
5.
They lack the necessary capital to invest in dairy equipment. The volume of milk produced may not be sufficient to invest in capital equipment. To form a cooperative would assist in increasing the volume through the collection of milk from several small farms. However the infrastructure and the underdeveloped roads and the great distances between farms could be inhibiting factors to go this route. Smaller processors tend to pay higher raw milk prices than the larger processors during periods of seasonal milk shortages because they lack the bargaining power that the larger processors have. During periods of surpluses the large producers dump their products in the retail sector at very low prices making it difficult for the small processors to compete. The big players in the market have facilities to convert raw milk into milk powder, butter, cheese or long-life milk which can be stored for longer periods of time. This facility is capital intensive and for the volumes of raw milk produced by the emerging farmers it is not really worth it in the long term. The farmers/producers lack the expertise, equipment to pasteurize milk. Transport and the quantity are major deterrents for small farmers to get their products to the big processors. The big processors/buyers find it not worth the effort to access these farmers due to the road infrastructure and small inconsistent and small volumes of milk produced. OPPORTUNITIES AND WEAKNESSES
Success in the dairy market depends on two factors namely: quality products and the support of processors. Successful advertising, exports and the development of new products are also important. Some consumers like to buy fresh milk direct from producers because the origin of the milk is known. A strong relationship can be built between producer/s and consumers. Producers can sell direct to small cafes and street vendors shortening the value chain cutting out some transaction costs resulting in an increase in profits. This channel will require higher capital and involves more risks. A sound relationship needs to be in place between the sellers and the buyers. Since deregulation the number of smaller milk producers has increased dramatically and processors are willing to receive milk from the smaller producers. However this supply channel will require a high level control measures on hygiene and the producer has to comply with the required standards. High demand of value added products such as sour milk, yoghurt and cheese can be a market to be explored. However to go this route would require high investment, market knowledge and the necessary training. Packaging to promote brand identification can open an opportunity but this would require market research and knowledge, training and investment. 6.
MARKET INTELLIGENCE
6.1. Export Tariffs
22
Tariffs that different importing countries applied to milk and dairy products originating from South Africa in 2010 and 2011 are shown in table 10 to 15. Table 10: Milk and cream (neither concentrated nor sweetened) Country
DRC
Malawi Mauritius
Product Code
040111000; 04012000 04013000 040111000; 04012000 & 04013000 040111000; 04012000 & 04013000 04011000 & 04012090
Trade Regime Description
&
MFN duties
2010 2011 Applied Tariffs Total Ad Applied valorem Tariffs Equivalent Tariff (estimated) 5.00%
Preferential tariff for SA
Total Ad valorem Equivalent Tariff (estimated) 5.00%
10.00%
10.00%
MFN duties
0.00%
0.00%
0.00%
0.00%
Preferential tariff for SA
15.00%
15.00%
15.00%
15.00%
MFN duties
0.00% 60.00%
0.00% 60.00%
0.00% 60.00%
0.00% 60.00%
MFN duties
40.00%
40.00%
40.00%
40.00%
Mozambique
United Republic Tanzania Zimbabwe
04012010 & 04013000 040111000; of 04012000 & 04013000 040111000; 04012000 & 04013000
Source: Market Access Map
Mauritius allowed the importation of milk and cream (not concentrated or sweetened) from South Africa duty free during 2010 and 2011. The most protected market exists in United Republic of Tanzania which applied the MFN duties of 60% in 2010 and 2011 followed by Democratic Republic of Congo (DRC) by 50% and Zimbabwe by 40% MFN duties applied. Mozambique continued with preferential tariff of 15%. Table 11: Milk and cream (concentrated or sweetened) Country
Angola
Product code
04021000; 04022100; 04029100 & 04029900
Trade Regime 2010 Description Applied Tariffs
MFN duties
2.00%
23
Total valorem Equivalent Tariff (estimated) 2.00%
2011 Ad Applied Tariffs
2.00%
Total Ad valorem Equivalent Tariff (estimated) 2.00%
Country
Malawi
Mozambique
United Republic Tanzania
Zimbabwe
Product code
04021000; 04022100 & 04022900
MFN Duties
10.00%
2011 Total Ad Applied valorem Tariffs Equivalent Tariff (estimated) 10.00% 10.00%
04029900
Preferential tariff for SA
10.00%
10.00%
10.00%
10.00%
04021010
MFN Duties
10.00%
10.00%
0.00%
0.00%
04021090
Preferential tariff for SA
10.00%
10.00%
10.00%
10.00%
04022110
MFN Duties
0.00%
0.00%
0.00%
0.00%
04022120
Preferential tariff for SA
0.00%
0.00%
0.00%
0.00%
04022900; 04029100; 04029910 & 04029990
Preferential tariff for SA
15.00%
15.00%
15.00%
15.00%
04021000; of 04022110; 04022190; 04022910; 04029110; 04029190; 04029910 & 04029990 04021010; 04022110; 04029110 & 04029190
MFN duties
60.00%
60.00%
04021090; 04022190; 04022990;
Trade Regime 2010 Description Applied Tariffs
Total Ad valorem Equivalent Tariff (estimated) 10.00%
MFN duties
20.00%
20.00%
20.00%
20.00%
MFN duties
40.00%
40.00%
40.00%
40.00%
24
Country
Product code
Trade Regime 2010 Description Applied Tariffs
2011 Total Ad Applied valorem Tariffs Equivalent Tariff (estimated)
Total Ad valorem Equivalent Tariff (estimated)
MFN duties
25.00%
25.00%
04029190 & 04029990 04022910
25.00%
25.00%
Source: Market Access Map
Malawi and Mozambique has a preferential tariff for exports of milk and cream (concentrated or sweetened) during 2010 and 2011 varying from 0% to 15% depending on the product. Zimbabwe’s market of Milk and Cream (Concentrated & sweetened) is the highest protected market with the MFN duties ranging from 20% to 40% during the period under review. Table 12: Buttermilk, cream, yoghurt, etc Country
Angola Malawi
Product Code
04031000 & 04039000 04031000 & 04039000 04031000
Mozambique
Trade Regime Description
2010 Applied Tariffs
MFN duties
10.00%
Total Ad valorem Equivalent Tariff (estimated) 10.00%
MFN duties
10.00%
Preferential tariff for South Africa
04039000 Zambia
04031000 & 04039000
Zimbabwe
04031000; 04039000; 04039010 & 04039090
Preferential tariff for South Africa MFN duties
2011 Applied Tariffs
10.00%
Total Ad valorem Equivalent Tariff (estimated) 10.00%
10.00%
10.00%
10.00%
15.00%
15.00%
15.00%
15.00%
0.00% 0.00%
0.00% 0.00%
0.00% 0.00%
0.00% 0.00%
40.00%
40.00%
40.00%
40.00%
Source: Market Access Map
Mozambique and Zambia has a preferential tariff for imports of buttermilk, curdled milk, cream and yoghurt ranging from 15% and 0% (free) r in 2010 and 2011. Angola and Malawi continued applying MFN duties of 10% to buttermilk, curdled milk, cream and yoghurt originating from South Africa from 2010 to 2011.
25
Zimbabwe applies MFN duties of 40% respectively to buttermilk, curdled milk, cream and yoghurt originating from South Africa in 2010 and 2011. Table 13: Whey and natural milk products Country
Japan
Republic of
Product code
Trade Regime Description
2010 Applied Tariffs
040410111; 040410151
MFN duties
29.80% + 4043.43 $/Ton
040410119
Total Ad valorem Equivalent Tariff (estimated)
2011 Applied Tariffs
35.00%
Total Ad valorem Equivalent Tariff (estimated ) 35.00%
MFN duties
25.00%
25.00%
040410129; 040410129; 040410139 & 040410149
MFN duties
29.80% + 4043.43 $/Ton
489.82%
040410169; 040410179 & 040410189 040410200 040490112
MFN duties
29.80% + 6536.09 $/Ton
773.40%
MFN duties MFN duties
21.30% 208.05%
040490118
MFN duties
040490122
MFN duties
040490127 0404901218
MFN duties MFN duties
040490132 & 040490138 040490200
MFN duties
21.30% 29.80% + 3805.58 $/Ton 29.80% + 3805.58 $/Ton 29.80% + 6459.98 $/Ton 25.00% 29.80% + 6459.98 $/Ton 29.80% + 9732.78 $/Ton 21.30%
0404102110
MFN duties
49.50%
49.50%
35.00%
MFN duties 49.50%
26
49.50%
157.19% 246.04% 25.00% 235.62% 355.59% 21.30%
Country
Korea
Product code
Trade Regime Description
; 0404102120 ; 0404102130 ; 0404102190 & 0404102900
Mozambique & Zambia Singapore
Zimbabwe
0404900000 04041000 & 04049000 04041011; 04041019; 04041091; 04041099 & 04049000 04041000 04049000
Preferential tariff for SA MFN duties
2010 Applied Tariffs
Total Ad valorem Equivalent Tariff (estimated)
2011 Applied Tariffs
Total Ad valorem Equivalent Tariff (estimated )
36.00%
36.00%
36.00%
36.00%
0.00%
0.00%
00%
0.00%
0.00%
0.00%
5.00%
5.00%
10.00%
10.00%
MFN duties
Source: Market Access Map
Mozambique and Zambia allowed importation of whey from South Africa at a preferential rate of 0% in 2010 and 2011. Singapore applied the MFN tariff of 0% in 2011. Republic of Korea was highly protected market applying 49.50% MFN duties. Japan’s import market was the most protected market of whey origination from South Africa with applied MFN tariff ranging from 21.30% to 773.40% during 2011. Table 14: Butter and other fats and oils derived from milk Country
Product code
040510129; 040520090;
Trade Regime Description MFN duties
040510229 Japan
040510229 040590190 040590229
Republic of Korea
0405200000
MFN duties MFN duties MFN duties MFN duties
27
2011 Applied Tariffs Total Ad valorem Equivalent Tariff (estimated) 29.80% + 9371.25 311.76% $/Ton 29.80% + 9371.25 547.34% $/Ton 29.80% + 9371.25 361.57% $/Ton 29.80% + 9371.25 299.96% $/Ton 29.80% + 9371.25 347.68% $/Ton 8.00% 8.00%
Country
Mozambique Singapore Zambia Zimbabwe
Product code
Trade Regime Description
04051000; 04052000; 04059010 & 04059090 04051000; 04052000 & 04059010; 04059020; 04059030; 04059090 04051000; 04052000 & 04059000 04051000; 04052000 & 04059000
Applied Tariffs
2011 Total Ad valorem Equivalent Tariff (estimated) 0.00%
Preferential tariff for SA MFN duties
0.00% 0.00%
0.00%
Preferential tariff for SA MFN duties
0.00%
0.00%
40.00%
40.00%
Source: Market Access Map
Mozambique and Zambia allow importation of whey from South Africa duty free in 2011. Singapore and Zimbabwe applied MFN duties of 40% to butter and other fats and oils derived from milk originating from South Africa during 2011. The most protected market exists in Japan with the total ad valorem equivalent tariff estimated at 299.96% to 361.57%. Table 15: Cheese and curd Country
Angola
DRC
Malawi
Mozambique
Zambia
Product code
04061000; 04062000; 04063000; 04064000 & 04069000 04061000; 04062000; 04063000; 04064000 & 04069000 04061000; 04062000; 04063000; 04064000 & 04069000 04061000; 04062000; 04063000; 04064000 & 04069000 04061000; 04062000; 04063000;
Trade Regime Description
2010 Applied Tariffs
MFN duties
10.00%
Total Ad valorem Equivalent Tariff (estimated) 10.00%
MFN duties
2011 Applied Tariffs
10.00%
Total Ad valorem Equivalent Tariff (estimated) 10.00%
20.00%
20.00%
MFN duties
25.00%
25.00%
25.00%
25.00%
Preferential tariff for SA
15.00%
15.00%
15.00%
15.00%
Preferential tariff for SA
0.00%
0.00%
0.00%
0.00%
28
Country
Product code
04064000 & 04069000 04061000; 04062000; 04063000; 04064000 & 04069000
Zimbabwe
Trade Regime Description
2010 Applied Tariffs
MFN duties
40.00%
Total Ad valorem Equivalent Tariff (estimated) 40.00%
2011 Applied Tariffs
40.00%
Total Ad valorem Equivalent Tariff (estimated) 40.00%
Source: Market Access Map
Angola, Mozambique and Malawi applied the MFN duties of 10%, 15% and 25% to cheese and curd originating from South Africa during 2010 and 2011. Zimbabwe has the highly protected import market at an applied tariff of 40%. Mozambique and Zambia has a preferential tariff for exports of cheese and curd of 15% and 0% respectively during 2010 and 2011. 6.2. Import tariffs Tariffs that South Africa applied to imports of milk and dairy products originating from all possible countries in 2010 and 2011 are shown in Table 16 to 21. Table 16: Milk and cream, neither concentrated nor sweetened Country
Argentina; Germany; Brazil United Kingdom Uruguay
Product code
04011007; 04011009; 04011090; 04012007; 04012009; 04012090; 04014007; 04014009; 04014090; 04015007; 04015009 & 04015090
Trade Regime Description Applied Tariffs
MFN duties
0.00%
2010 Total Ad Applied valorem Tariffs Equivalent Tariff (estimated) 0.00% 0.00%
2011 Total Ad valorem Equivalent Tariff (estimated) 0.00%
Source: Market Access Map
South Africa applies no tariff on all the imports of milk and cream (neither concentrated nor sweetened).
29
Table 17: Milk and cream, concentrated or sweetened Country
Product code
Trade Regim e Descri ption
04021010 & 04021090
MFN duties
04022110 & 04022190
96.00% or 661.73$/To n whichever is the lower
26.47%
96.00% or 661.73$/To n whichever is the lower
27.47%
96.00% or 661.73$/To n whichever is the lower
40.32%
96.00% or 661.73$/To n whichever is the lower
13.50%
96.00% or 589.54$/To n whichever is the lower
24.98%
04022110 & 04022190
96.00% or 589.54$/To n whichever is the lower
26.47%
04022900
96.00% or 589.54$/To n whichever is the lower
27.47%
96.00% or 589.54$/To n whichever is the lower
40.32%
04022900 Belgium; United States of America & Uruguay
2010 Total Ad valorem Equivalent Tariff (estimated) 96.00% or 24.98% 661.73 $/Ton whichever is the lower Applied Tariffs
04029100
04029900
04021010 & 04021090
France & New Zealand
04029100
MFN duties
Country
Product code
Australia; Belgium; France; Germany ; Ireland; New Zealand
0402101 0& 0402101 0 0402211 0& 0402219 0 0402290 0
0402910 0
2011 Applied Tariffs Total Ad valorem Equivalent Tariff (estimated) 96.00% or 540.00 16.89% $/Ton whichever is the lower 96.00% or 540.00$/Ton whichever is the lower 96.00% or 540.00$/Ton whichever is the lower
17.27% 10.94%
96.00% or 540.00$/Ton whichever is the lower
9.26%
96.00% or 540.00$/Ton whichever is the lower
10.79%
96.00% or 661.73 $/Ton whichever is the lower
N/AN/AN/A N/A N/A
0402990 0 France & New Zealand
96.00% or 661.73$/Ton whichever is the lower 96.00% or 661.73$/Ton whichever is the lower 96.00% or 661.73$/Ton whichever is the lower
30
Country
Product code
Trade Regim e Descri ption
04029900
Applied Tariffs
2010 Total Ad valorem Equivalent Tariff (estimated)
96.00% or 589.54$/To n whichever is the lower
Country
Product code
13.50%
2011 Applied Tariffs Total Ad valorem Equivalent Tariff (estimated) 96.00% or 661.73$/Ton whichever is the lower
Source: Market Access Map
Table 17 indicates that South Africa applied a total ad valorem equivalent tariff for milk and cream (concentrated or sweetened) of 24.98%, 26.47% 27.47% 40.32% and 13.50% depending on the product code to Belgium, USA, Uruguay, France and New Zealand in 2010 and in 2011 it applied 16.89%, 17.27%, 10.94%, 9.26% and 10.79% to Belgium, USA and Uruguay. Table 18: Buttermilk, cream, yoghurt, etc Country
Belgium; France; Ireland; Netherlands; New Zealand & Spain
Product code
Trade Regime Description
04031000
MFN duties
04039010; 04039020& 04039090
Applied Tariffs
0.00% 96.00% or 661.73 $/Ton whichever is the lower 96.00% or 661.73 $/Ton whichever is the lower
2010 Total Ad valorem Equivalent Tariff (estimated) 0.00% 31.21%
Applied Tariffs
0.00% 96.00% or 540.00 $/Ton whichever is the lower
2011 Total Ad valorem Equivalent Tariff (estimated) 0.00% 19.21% 21.13% 17.55%
96.00% or 661.73 $/Ton whichever is the lower
Source: Market Access Map
Table 18 indicates that South Africa decreased its applied the total ad valorem equivalent tariff of 31.21% to 19.21%, 21.13% and 17.55% depending on the product code to imports from Belgium, France, Ireland, Netherlands, New Zealand and Spain during 2010 and 2011.
31
Table 19: Whey and other natural milk products Country
Product code
Trade Regime Description
04041000
MFN duties
Argentina; France; Germany; Ireland; New Zealand & United States of America 04049010 & 04049090
2010 2011 Total Ad Applied Total Ad valorem Tariffs valorem Equivalent Equivalent Tariff Tariff (estimated) (estimated) 96.00% or 34.61% 96.00% or 18.24% 661.73 540.00 $/Ton $/Ton whichever is whichever the lower is the lower Applied Tariffs
96.00% or 661.73 $/Ton 22.82% whichever is the lower
Source: Market Access Map
96.00% or 540.00 $/Ton 16.62% whichever is the lower
Table 19 indicates that South Africa decreased its applied and ad valorem equivalent tariff to Argentina, France, Germany, Ireland, New Zealand and USA for whey from 96% or $ 661.73/ton, whichever is lower and 34.61% respectively in 2010 to 96% or $ 540/ton, whichever is lower and 18.24% respectively in 2011. Table 20: Butter and other fats and oils derived from milk Country
Produc t code
Trade Regime Descripti on
040510 00
MFN duties
Australia; Belgium; Denmark Ireland & New 040520 Zealand 00 040590 00
2010 Total Ad Country valorem Equivalent Tariff (estimated) 79.00% or 35.67% Belgium; 735.26 Denmar &/Ton k; whichever France; is lower Ireland; New Zealand; 19.78% United States of America 27.48% Applied Tariffs
Product code
04051000
04052000 04059000
20111 Applied Tariffs
79.00% or 600.00 &/Ton whichever is lower
Total Ad valorem Equivalent Tariff (estimated) 17.32%
20.17% 21.57%
Source: Market Access Map
Table 20 indicates that South Africa decreased its applied and ad valorem tariff for butter and other fats and oils derived from milk from 79% or $ 735.26/ton, whichever is lower and 35.67% respectively during 2010 to 79% or 600 $/Ton whichever is the lower or 17.32%, 20.17% and 21.57% depending on the product code in 2011. The main exporting countries of butter and other fats and oils to South Africa was Australia, Belgium, Denmark, Ireland and New Zealand. 32
Table 21: Cheese and curd Country
France; Ireland; Italy; New Zealand &United States of America
Product code
Trade Regime Descripti on
0406100 0
MFN duties
Applied Tariffs
2010 Total Ad valorem Equivalent Tariff (estimated)
95.00% 14.74% or 735.26 $/Ton whicheve r is the lower
0406200 0
10.96%
0406300 0
14.24%
0406400 0
12.23%
0406901 1; 0406901 2; 0406902 1; 0406902 2; 0406909 1 & 0406909 9
16.13%
Country
Product code
Australia; 0406100 Denmark 0 ; France; Germany ; Ireland; Italy & New Zealand 0406200 0 0406300 0 0406400 0 0406901 1 0406901 2 0406902 1 0406902 2 0406909 1 0406909 9
2011 Applied Tariffs
Total Ad valorem Equivalent Tariff (estimated ) 95.00% or 7.16% 600.00 $/Ton whichever is the lower
7.63% 9.71% 8.20% 12.52% 17.45% 12.52% 14.97% 12.52% 7.41%
Source: Market Access Map
Table 21 indicates that South Africa applied different tariffs depending on different product codes for cheese and curd from France, Ireland, New Zealand, Italy and USA. The total ad valorem equivalent tariff of 14.74%, 10.96%, 14.24%, 12.23% and 16.13% and the applied tariff was at 95% or 735.26 $ /Ton or whichever is the lower applied in 2010 has decreased to 7.16%, 7.63%, 9.71%, 8.20%, 12.52%, 17.45%, 14.97% and 7.41% on total ad valorem and 95% or 600$/Ton on the applied tariff during 2011.
33
7.
COMPETITIVENESS OF THE DAIRY INDUSTRY
7.1. Exports 7.1.1. Milk and cream (neither concentrated nor sweetened) Table 22: List of importing markets for the product exported by South Africa in 2011 South Africa’s exports represent 0.26% of world exports for Milk and cream, (not concentrated or sweetened), its ranking in world’s exports is 34. Trade Indicators
Importers
Exported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's exports (%)
Exported quantity 2011
Quantity unit
Unit value (USD/unit)
Exported growth in value between 2007-2011 (%, p.a.)
Exported growth in quantity between 2007-2011 (%, p.a.)
Exported growth in value between 2010-2011 (%, p.a.)
World
21785
15309
100
20795
Tons
1048
44
22
23
Zimbabwe
12122
12122
55.6
12419
Tons
976
228
264
41
5075
5075
23.3
4063
Tons
1249
25
-6
2171
2171
10
2468
Tons
880
23
457
457
2.1
222
Tons
2059
Mauritius
393
393
1.8
330
Tons
Malawi
359
359
1.6
259
Comoros
317
317
1.5
Zambia
229
229
Angola
224
224
Ghana
146
144
Mozambique United Republic of Tanzania Democratic Republic of the Congo
Ranking of partner countries in world imports
Share of partner countries in world imports (%)
Total import growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) faced by South Africa (%)
100
5
54
0.2
242
40
2
75
0.1
19
8.5
9
50
72
0.1
40
60
34
10
180
90
0
52
5
1191
-1
-13
-19
83
0.1
-2
0
Tons
1386
41
27
10
132
0
16
10
333
Tons
952
10
6
-21
133
0
38
0
1.1
128
Tons
1789
19
-5
0
176
0
-15
5
1
191
Tons
1173
-28
-35
49
45
0.2
24
2
0.7
131
Tons
1115
12
9
40
100
0
13
20
Source: ITC calculations based on COMTRADE statistics.
34
Table 22 shows that during 2011, South Africa exported a total of 15 309 tons of milk and cream (not concentrated or sweetened) at an average value of US$ 1 048/unit. South Africa exported greater quantities of milk and cream (not concentrated or sweetened) to Zimbabwe, Mozambique and United Republic of Tanzania. The greatest share of South African milk and cream (not concentrated or sweetened) exports were destined to Zimbabwe which commanded 55.6% share during the year 2011 followed by Mozambique (23.3 %) then United Republic of Tanzania by 10%. South Africa’s milk and cream (not concentrated or sweetened) exports increased by 44% in value and 22% in quantity between the periods 2007 and 2011. During the same period, exports of milk and cream (not concentrated or sweetened) to Zimbabwe increased by 223% in value while quantity increased by 264%; and Mozambique increased by 25% in value and decreased by 6% in quantity. Between the periods 2010 and 2011 South Africa’s exports of milk and cream (not concentrated or sweetened) increased by 23% in value. During the same period, Zimbabwe and Mozambique increased by 41% and 2% respectively in value.
35
Figure 26: Growth in demand for milk and cream exports by South Africa in 2011
Source: ITC Trademap
36
Figure 26 illustrates that South Africa’s exports of milk and cream (not concentrated or sweetened) represent 0.26% of world exports. Between 2007 and 2011 South Africa’s milk and cream, not concentrated or sweetened to Kenya, Democratic republic of Congo, United Republic of Tanzania, Ghana, Nigeria, Angola, Comoros and Zimbabwe were growing at a rate that is less than their import growth from the world. This means that South Africa is losing the market in the mentioned countries. During the same period, South Africa’s milk and cream (not concentrated or sweetened) exports to Uganda, Mauritius, Zambia, Mozambique, Malawi and Saint Helena were growing at a rate that is greater than their imports from the rest of the world. Therefore South Africa is gaining the market share in those countries. Mauritius and Zambia represent loses in the declining market and other countries represent gains the dynamic market. Uganda had the most growing demand for the South African milk and cream not concentrated nor sweetened during the periods 2007 to 2011. Annual growth of exports to Uganda was 74% followed at a distant by Malawi by 31%.
37
Figure 27: Prospects for market diversification for milk and cream exported by South Africa in 2011
Source: ITC Trademap
38
South Africa is currently exporting large quantities of milk and cream, not concentrated nor sweetened to Zimbabwe, and it has a market share on 55.64% of South Africa’s exports (see Figure 27). Zimbabwe’s imports from the world is greater than its imports from South Africa, therefore South Africa can still penetrate Zimbabwe’s import market because its annual growth is also attractive (242%). If South Africa wishes to diversify its exports of milk and cream (not concentrated or sweetened), Kenya is the smallest market but attractive for market development because its annual imports growth is growing at a rate of 88% respectively.
39
7.1.2. Milk and cream, concentrated or sweetened Table 23: List of importing markets for the product exported by South Africa in 2011 South Africa's exports represent 0.14% of world exports for milk and cream (concentrated or sweetened), its ranking in world exports is 43. Trade Indicators
Importers
Exported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's exports (%)
Exported quantity 2011
Quantity unit
Unit value (USD/unit)
Exported growth in value between 2007-2011 (%, p.a.)
Exported growth in quantity between 2007-2011 (%, p.a.)
Exported growth in value between 2010-2011 (%, p.a.)
World
24249
-5214
100
8176
Tons
2966
9
4
26
Mozambique
12437
12437
51.3
4631
Tons
2686
17
19
84
Zimbabwe
5964
5964
24.6
1363
Tons
4376
55
47
Zambia
3194
3194
13.2
548
Tons
5828
-7
Malawi
721
721
3
146
Tons
4938
Angola Democratic Republic of the Congo
623
623
2.6
674
Tons
399
399
1.6
246
Ghana United Republic of Tanzania
317
317
1.3
144
144
Kenya
Ranking of partner countries in world imports
Share of partner countries in world imports (%)
Total import growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) faced by South Africa (%)
100
4
93
0.1
29
7.3
27
127
0
81
30.1
-29
-40
106
0.1
13
0
-31
-36
74
133
0
5
10
924
3
9
62
34
0.6
9
2
Tons
1622
-2
3
6
59
0.3
7
5
151
Tons
2099
81
100
77
53
0.4
2
20
0.6
157
Tons
917
-16
30
-32
171
0
5
60
-5
106
105
0.4
28
Tons
3786
Madagascar
89
89
0.4
25
Tons
3560
Congo
55
55
0.2
71
Tons
775
Source: ITC calculations based on COMTRADE statistics.
40
47
-8
715
104
0.1
41
60
202
35
121
0
-2
3.7
55
-54
78
0.2
12
5
Table 23 shows that during 2011 South Africa exported a total of 8 176 tons of milk and cream (concentrated or sweetened) at an average value of US$ 2 966/unit. South Africa exported greater quantities of milk and cream (concentrated or sweetened) to Mozambique, Zimbabwe and Zambia. The greatest share of South African milk and cream (concentrated or sweetened) exports were destined to Mozambique which commanded 15.3% share during the year 2011 followed by Zimbabwe (24.6 %) then Zambia by 13.2%. South Africa’s milk and cream (concentrated or sweetened) exports increased by 9% in value and 4% in quantity between the periods 2007 and 2011. During the same period, exports of milk and cream (concentrated or sweetened) to Mozambique increased by 17% in value and 19% in quantity and Zimbabwe recorded the highest growth of 55% in quantity and 47% in value during the period 2007 to 2011. Between the periods 2010 and 2011, South Africa’s exports of milk and cream (concentrated or sweetened) decreased by 26% in value. During the same period, Mozambique and Zimbabwe increased by 84% and 27% respectively.
41
Figure 28: Growth in demand for sweetened milk and cream exported by South Africa in 2011
Source: ITC Trademap
42
Figure 28 illustrates that South Africa’s exports of milk and cream (concentrated or sweetened) represent 0.14% of world exports. Between 2007 and 2011 South Africa’s milk and cream (concentrated or sweetened) was losing the market share in Zimbabwe, Zambia, Kenya, Malawi, Angola, Democratic Republic of Congo, Nigeria, Gabon, United Republic of Tanzania, Mozambique and Mauritius because imports from South African were growing at a rate that is less than their imports growth from the world. During the same periods, South Africa was gaining the market shares of milk and cream (concentrated or sweetened) exports to Uganda, Saint Helena, Cyprus, Congo and Ghana because imports from South African were growing at a rate that is greater than their imports from the rest of the world. Countries which has the most growing in demand of South African Milk and Cream (Concentrated and sweetened) are Ghana and Uganda with the annual exports growth of 81% and 79% respectively to the mentioned countries.
43
Figure 29: Prospects for market diversification for sweetened milk and cream exported by South Africa in 2011
Source: ITC Trademap
44
Most of South African milk and cream (concentrated and sweetened) destined in Mozambique and Zimbabwe, but these countries’ imported more from the rest of the world than from South Africa (see Figure 29). Therefore South Africa can either penetrated their import market or diversify to United Arab Emirates because it is the biggest market of milk and cream (concentrated or sweetened) in the world.
45
7.1.3. Buttermilk and yoghurt Table 24: List of importing markets for Buttermilk and yoghurt exported by South Africa in 2011 South Africa’s exports represent 0.44% of world exports for Buttermilk and yoghurt, its ranking in world exports is 39. Trade Indicators
Importers
Exported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's exports (%)
Exported quantity 2011
Quantity unit
Unit value (USD/unit)
Exported growth in value between 2007-2011 (%, p.a.)
Exported growth in quantity between 2007-2011 (%, p.a.)
Exported growth in value between 2010-2011 (%, p.a.)
World
17856
11177
100
9216
Tons
1938
24
16
80
Angola
8378
8374
46.9
3577
Tons
2342
23
26
267
Mozambique
5400
5400
30.2
3339
Tons
1617
29
8
Zimbabwe
2180
2180
12.2
1288
Tons
1693
54
Zambia
504
504
2.8
329
Tons
1532
Malawi Democratic Republic of the Congo
426
426
2.4
309
Tons
197
197
1.1
104
Nigeria
121
121
0.7
Seychelles
Ranking of partner countries in world imports
Share of partner countries in world imports (%)
Total import growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) faced by South Africa (%)
100
1
22
0.9
18
10
17
62
0.1
32
10.2
81
111
98
0.1
55
40
61
56
17
135
0
59
0
1379
29
36
-17
136
0
38
10
Tons
1894
32
49
99
123
0
1
10
50
Tons
2420
-18
-29
-44
37
0.5
-1
14.4
-3
-3
2080
115
0
49
50
23
42
0.3
5
5
109
109
0.6
42
Tons
2595
Saudi Arabia
69
52
0.4
16
Tons
4313
Mauritius
68
68
0.4
19
Tons
3579
5
-42
13
158
0
26
0
Ghana
67
67
0.4
23
Tons
2913
40
16
-55
74
0.1
-5
20
Source: ITC calculations based on COMTRADE statistics.
46
Table 24 shows that during 2011 South Africa exported a total of 9 216 tons of buttermilk and yoghurt at an average value of US$ 1 938/unit. South Africa exported greater quantities of buttermilk and yoghurt to Angola, Mozambique and Zimbabwe. The greatest share of South African buttermilk and yoghurt exports were destined to Angola which commanded 46.9% share during the year 2011 followed by Mozambique with 30.2% then Zimbabwe by12.2%). South Africa’s buttermilk and yoghurt exports have increased by 24% in value and 16% in quantity between the periods 2007 and 2011. During the same period, exports of buttermilk and yoghurt to Angola increased by 23% in value and 26% in quantity; Mozambique increased by 29% each in value and 8% in quantity. Zimbabwe experience highest increases of 54% in value and 81% in quantity. Between the periods 2010 and 2011, South Africa’s exports of buttermilk and yoghurt decreased by 80% in value. During the same period, Angola, Mozambique and Zimbabwe increased by 267%, 17% and 111% respectively in value.
47
Figure 30: Growth in demand for buttermilk and yogurt exported by South Africa in 2011
Source: ITC Trademap
48
Figure 30 illustrates that South Africa’s exports of buttermilk and yoghurt represent 0.44% of the world exports. Between 2007 and 2011 South Africa was losing the market share of buttermilk and yoghurt in Malawi, Seychelles, Zimbabwe, Nigeria, Maldives, Mozambique and Mauritius because its exports were growing at a rate that is less than their import growth from the rest of the world. During the same periods, South Africa’s buttermilk and yoghurt exports to Uganda, Democratic Republic of Congo, Ghana, Saint Helena, Zambia and Angola were growing at a rate that is greater than their imports from the rest of the world. Therefore South Africa is gaining the market share in these countries. The fastest growing market of South African buttermilk and Yogurt exist in Zambia with the annual South African exports of 61% and its annual import growth is at 59%.
49
Figure 31: Prospects for market diversification for buttermilk and yogurt exported by South Africa in 2011
Source: ITC Trademap
50
South Africa’s exports of buttermilk and yoghurt are dominant in Angola but if South Africa wishes to diversify its exports the most attractive market will be Togo (see Figure 31). Even though its world market share is at 0.1%, its annual growth of 135% makes it very attractive. The smallest possible market is at Zambia. South Africa is currently exporting 2.82% of buttermilk and yogurt to Zambia and its annual import growth is at 59%. South Africa might therefore penetrate the Zambian import marker of buttermilk and yogurt.
51
7.1.4. Whey and other natural milk products Table 25: List of importing markets for whey and natural milk exported by South Africa in 2011 South Africa's exports represent 0.04% of world exports for whey and natural milk, its ranking in world exports is 43. Trade Indicators
Importers
Exported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's exports (%)
Exported quantity 2011
Quantity unit
Unit value (USD/unit)
Exported growth in value between 2007-2011 (%, p.a.)
Exported growth in quantity between 2007-2011 (%, p.a.)
Exported growth in value between 2010-2011 (%, p.a.)
World
1804
-24798
100
1273
Tons
1417
8
2
-44
Japan
507
507
28.1
454
Tons
1117
6
6
-68
Zambia Republic of Korea
475
475
26.3
307
Tons
1547
131
134
240
240
13.3
202
Tons
1188
-8
Zimbabwe
151
151
8.4
68
Tons
2221
Singapore
100
100
5.5
17
Tons
Mozambique
94
94
5.2
50
Malaysia
90
90
5
Viet Nam Democratic Republic of the Congo
64
64
25
India Mauritius Malawi
Ranking of partner countries in world imports
Share of partner countries in world imports (%)
Total import growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) faced by South Africa (%)
100
1
11
3
0
322.4
164
110
0
96
0
-15
-55
10
3
-1
42.8
40
39
82
125
0
69
5.3
5882
-14
-12
12
2.3
8
0
Tons
1880
-7
-10
83
0
-6
0
76
Tons
1184
13
2.3
4
0
3.5
75
Tons
853
25
1.4
16
Tons
1563
14
14
0.8
3
Tons
4667
13
13
0.7
0
Tons
8
8
0.4
0
Tons
Source: ITC calculations based on COMTRADE statistics.
52
-16
7
-62
22
1.1
10
0
-5
39
133
0
10
5
38
0.4
51
30
-1
122
0
-7
0
18
171
0
0
10
-11
Table 25 shows that during 2011 South Africa exported a total of 1 273 tons of whey and natural milk products at an average value of US$1 417/unit. South Africa exported greater quantities of whey and natural milk products to Japan, Zambia and Republic of Korea. The greatest share of South African whey and natural milk products exports were destined to Japan which commanded 28.1% share during the year 2011 followed by Zambia taking 26.3% and Republic of Korea by 13.3%. South Africa’s whey and natural milk products exports increased by 8% in value and 2% in quantity between the periods 2007 and 2011. During the same periods, exports of whey and natural milk products to Japan increased by 6% in value and in quantity and Zambia experienced the highest increased by 131% in quantity and 134% in value; while Republic of Korea decreased by 8% in value and 15% in quantity. Between the periods 2010 and 2011, South Africa’s exports of whey and natural milk products decreased by 44% in value. During the same period, Japan decreased by 68%; Zambia increased by 164% and Republic of Korea decreased by 55% respectively in value.
53
Figure 32: Growth in demand for whey exported by South Africa in 2011
Source: ITC Trademap
54
Figure 32 illustrates that that South Africa’s exports of whey and natural milk products represent 0.04% of the world exports. Between 2007 and 2011 South Africa’s whey and natural milk products exported to New Zealand, Democratic Republic of Congo, Zambia and Zimbabwe were growing at a rate that is less than their import growth from the rest of the world. Therefore, South Africa is losing the market share in the mentioned countries. During the same period, South Africa is gaining the market shares of whey and natural milk products exports in Kenya, Japan, Malawi, Zambia and Mauritius because their imports from South Africa were growing at a rate that is greater than their imports from the rest of the world. Zambia’s annual demand growth of South African whey and natural milk products is the highest at 131% rate.
55
Figure 33: Prospects for market diversification for whey exported by South Africa in 2011
Source: ITC Trademap
56
The chart illustrates that Japan is the biggest importer of South African whey and natural milk products with a world market share of 3% (see Figure 33). The biggest market exists in China with the world import share of 12.5%. South Africa might look on developing a new market in China especially that its annual import growth is at 13%. The fastest growing markets although small exist in Seychelles and Zimbabwe. Seychelles’s annual import growth is at 79% followed by Zimbabwe by 69%. Therefore these two markets might be the most attractive markets for South Africa to diversify to
57
7.1.5. Butter and other fats and oils derived from milk Table 26: List of importing markets for butter and other fats and oils derived from milk exported by South Africa in 2011 South Africa’s export represent 0.06% of world export for butter and other fats and oils derived from milk, its ranking in world exports is 42. Trade Indicators
Importers
Exported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's exports (%)
Exported quantity 2011
Quantity unit
Unit value (USD/unit)
Exported growth in value between 2007-2011 (%, p.a.)
Exported growth in quantity between 2007-2011 (%, p.a.)
Exported growth in value between 2010-2011 (%, p.a.)
Ranking of partner countries in world imports
World
4246
-9644
100
987
Tons
4302
15
2
-12
Mozambique
1521
1521
35.8
363
Tons
4190
14
-5
22
113
Zimbabwe
902
902
21.2
218
Tons
4138
52
33
-32
Mauritius
865
865
20.4
174
Tons
4971
17
2
0
Zambia
451
451
10.6
103
Tons
4379
33
13
Malawi Democratic Republic of the Congo United Arab Emirates
159
159
3.7
46
Tons
3457
-3
76
76
1.8
17
Tons
4471
17
48
48
1.1
10
Tons
4800
45
45
1.1
12
Tons
3750
15
34
34
0.8
6
Tons
5667
1
Saint Helena United Republic of Tanzania
Sources: ITC calculations based on COMTRADE statistics.
58
Share of partner countries in world imports (%)
Total import growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) faced by South Africa (%)
100
7
0
16
0
128
0
60
40
67
0.1
8
0
-16
152
0
11
0
-10
-33
176
0
-4
25
5
-50
87
0.1
21
20
336
33
0.7
3
5
10
80
195
0
9
4
-13
158
0
-5
25
Table 26 shows that during 2011 South Africa exported a total of 987tons of butter and other fats derived from milk at an average value of US$ 4 302/unit. South Africa exported greater quantities of butter and other fats derived from milk to Mozambique, Zimbabwe and Mauritius. The greatest share of South African butter and other fats derived from milk exports were destined to Mozambique which commanded 35.8% share during the year 2011 followed by Zimbabwe (21.2%) then Mauritius received a share of 20.4%. South Africa’s butter and other fats derived from milk exports increased by 15% in value and 2% in quantity between the periods 2007 and 2011. During the same periods, exports of butter and other fats derived from milk to Mozambique increased by 14% in value and decreased by 5% in quantity; and Zimbabwe increased by 52% in value and decreased by 33% quantity. Between the periods 2010 and 2011, South Africa’s exports of butter and other fats derived from milk decreased by 12% in value. During the same periods, Mozambique increased by 22% and Zimbabwe decreased by 32% in value.
59
Figure 34: Growth in demand for butter exported by South Africa in 2011
Source: ITC Trademap
60
Figure 34 illustrates that that South Africa’s exports of butter and other fats and oils represent 0.06% of the world exports. Between 2007 and 2011 South Africa’s butter and other fats exported to Zimbabwe, Kenya, Nigeria, Australia, Uganda, Ghana, Democratic Republic of Congo (DRC), Malawi and Angola were growing at a rate that is less than their export growth to the rest of the world. During the same period, South Africa’s butter and other fats exports to Saint Helena, Zambia, Mauritius, United Republic of Tanzania and Mozambique were growing at a rate that is greater than their exports to the rest of the world. United republic of Tanzania represent losses in the declining market while Mauritius, Zambia, Saint Helena and Mozambique represent gains in the dynamic market. The most growing demand of butter and other fats and oils exist in Zimbabwe with South African exports growing at 52% per annum during the periods 2007 to 2011.
61
Figure 35: Prospects for market diversification for butter exported by South Africa in 2011
Source: ITC Trademap
62
Figure 35 illustrates that South Africa is currently exporting butter and other fats to Mozambique, Mauritius and Zimbabwe but if South Africa has to diversify its export market, the most growing market exist in China with an annual imports growth of 44%. South Africa can develop into China’s import market since is not exporting butter and other fats to this market. The biggest market exist in Germany with a world share of 9.6% buts its annual imports growth has decreased by 3%, therefore it will be difficult for South Africa to penetrate this market.
63
7.1.6. Cheese and Curd Table 27: List of importing markets for the product exported by South Africa in 2011 South Africa’s exports represent 0.04% of world exports of cheese and curd, its ranking in world exports is 50. Trade Indicators
Importers
World
Exported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's exports (%)
Exported quantity 2011
Quantity unit
Unit value (USD/unit)
Exported growth in value between 2007-2011 (%, p.a.)
Exported growth in quantity between 2007-2011 (%, p.a.)
Exported growth in value between 2010-2011 (%, p.a.)
11249
-29093
100
2304
Tons
4882
28
23
7
Mozambique
3457
3457
30.7
790
Tons
4376
18
14
-15
Zimbabwe
3049
3049
27.1
503
Tons
6062
153
135
Zambia
2312
2312
20.6
495
Tons
4671
43
Angola
650
650
5.8
150
Tons
4333
Malawi Democratic Republic of the Congo
419
419
3.7
104
Tons
345
345
3.1
60
Nigeria
229
229
2
Saudi Arabia United Republic of Tanzania
203
203
178
Mauritius
120
Ghana
115
Ranking of partner countries in world imports
Share of partner countries in world imports (%)
Total import growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) faced by South Africa (%)
100
4
120
0
19
12.2
66
133
0
105
40
31
39
135
0
35
0
11
16
9
80
0.1
6
10
4029
16
18
-29
176
0
18
25
Tons
5750
12
11
-24
142
0
19
20
50
Tons
4580
28
23
68
131
0
14
20
1.8
50
Tons
4060
14
1.7
8
5
178
1.6
16
Tons
11125
1
-7
-14
179
0
-1
25
120
1.1
24
Tons
5000
20
23
161
72
0.1
11
0
115
1
25
Tons
4600
56
38
-23
132
0
27
20
Sources: ITC calculations based on COMTRADE statistics.
64
Table 27 shows that during 2011 South Africa exported a total of 2 304 tons of cheese and curd at an average value of US$ 4 882/unit. South Africa exported greater quantities of cheese and curd to Mozambique, Zimbabwe and Zambia. The greatest share of South African cheese and curd exports were destined to Mozambique which commanded 30.7% share during the year 2011 followed by Zimbabwe with 27.1% then Zambia by 20.6%. South Africa’s cheese and curd exports increased by 28% in value and 23% in quantity between the periods 2007 and 2011. During the same period, exports of cheese and curd to Mozambique increased by 18% in value and 14% in quantity; and Zimbabwe increased in value and quantity by 153% and 135% respectively. Between the periods 2010 and 2011, South Africa’s exports of cheese and curd increased by 7% in value. During the same period, Mozambique decreased by 15% and Zimbabwe increased by 66%.
65
Figure 36: Growth in demand for cheese and curd from South Africa in 2011
Source: ITC Trademap
66
Figure 36 illustrates that that South Africa’s exports of cheese and curd represent 0.04% of the world exports. Between 2007 and 2011 South Africa s losing the market share of cheese and curd exports to Kenya, Democratic Republic of Congo (DRC), Seychelles, Uganda, Saint Helena and Malawi because its exports were growing at a rate that is less than their import growth from the rest of the world. During the same period, South Africa is gaining the market share of cheese and curd exports to Ghana, Zambia, Nigeria, Mauritius, Mozambique, Angola, Chad, Zimbabwe, and United Republic of Tanzania were growing at a rate that is greater than their imports from the rest of the world. This means South Africa is gaining the market shares in the dynamic market (Ghana, Zambia, Nigeria, Mauritius, Mozambique, Angola, Chad and Zimbabwe) and losing in the declining market (United Republic of Tanzania).
67
Figure 37: Prospects for market diversification for cheese and curd exported by South Africa in 2011
Source: ITC Trademap
68
Figure 37 shows that Saudi Arabia is the world’s greatest importer of cheese and curd, but is not the main importer of South African cheese and curd. Its share in South African market is 1.8% and its annual import growth is 8%. This makes it impossible for South Africa to develop a market in Greece. Zimbabwe although is a small market of cheese and curd but it is the most attractive market for South Africa due to its annual growth of 102%. Currently South Africa exports 27.1% of cheese and curd to Zimbabwe therefore SA can penetrated the Zimbabwean import market.
69
7.2.
Imports
7.2.1. Milk and cream (neither concentrated nor sweetened) Table 28: List of supplying markets for the product imported by South Africa in 2011 South Africa’s imports represent 0.08% of world imports for milk and cream (not concentrated nor sweetened), its ranking in world imports is 74. Trade Indicators
Exporters
Imported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's imports (%)
Imported quantity 2011
Quantity unit
Unit value (USD/unit)
Imported growth in value between 2007-2011 (%, p.a.)
Imported growth in quantity between 2007-2011 (%, p.a.)
Imported growth in value between 2010-2011 (%, p.a.)
-11
-15
Ranking of partner countries in world exports
Share of partner countries in world exports (%)
Tariff (estimated) applied by South Africa (%)
World
6476
15309
100
8306
Tons
780
-5
Uruguay
3776
-3776
58.3
5285
Tons
714
16
2
96
33
0.3
3
0
Argentina
2321
-2321
35.8
2642
Tons
879
-9
-13
-57
48
0.1
-1
0
Germany United Kingdom
226
-226
3.5
280
Tons
807
-35
15
11200
1
21
1
0
133
-133
2.1
74
Tons
1797
-23
-33
29
5
5.7
6
0
11
-11
0.2
14
Tons
786
34
0.3
44
Ghana
2
144
0
2
Tons
1000
105
0
0
Nigeria
2
53
0
2
Tons
1000
102
0
0
Thailand
2
-2
0
1
Tons
2000
30
0.3
-4
0
Cameroon
1
-1
0
3
Tons
333
116
0
-40
0
Italy
1
-1
0
1
Tons
1000
29
0.4
-1
0
Kenya
1
3
0
0
Tons
51
0.1
24
0
Netherlands
1
-1
0
1
Tons
4
8.4
11
0
South Africa
1000
Source: ITC calculations based on COMTRADE statistics.
70
19 -50
-42
-53
100
Total export growth in value of partner countries between 2007-2011 (%, p.a.) 5
Table 28 shows that during 2011 South Africa imported a total of 8 306 tons of milk and cream (not concentrated nor sweetened), at an average value of US$ 780/unit. South Africa imported greater quantities of milk and cream, (not concentrated or sweetened) from Uruguay, Argentina and Germany. The greatest share of South African milk and cream (not concentrated or sweetened) imports originated from Uruguay which commanded 58.3% share during the year 2011 followed by Argentina with 35.8% then follow Germany by 3.5%. South Africa’s milk and cream (not concentrated or sweetened) imports decreased by 5% in value and 11% in quantity between the periods 2007 and 2011. During the same period, imports of milk and cream (not concentrated or sweetened) from Uruguay increased by 16% in value and 2% in quantity; and Argentina decreased in value and quantity by 9% and 13% respectively. Between the periods 2010 and 2011, South Africa’s imports of milk and cream (not concentrated or sweetened) decreased by 15% in value. During the same period imports of milk and cream (not concentrated or sweetened) from Uruguay to South Africa increased by 96% and Argentina’s imports decreased by 57% in value.
71
Figure 38: Competitiveness of suppliers to South Africa for unsweetened milk and cream in 2011
Source: ITC Trademap
72
Figure 38 illustrates that South Africa’s imports between 2007 and 2011 represent 0.08% of the world’s imports of milk and cream, not concentrated or sweetened. Imports from Germany, Netherlands, Argentina and United Kingdom (UK) were growing at a rate that is less than their export growth to the rest of the world. This means that South Africa is losing the market share in the mentioned countries. During the same period, South Africa is gaining the market share of milk and cream, not concentrated or sweetened imports from Uruguay because South Africa’s import growth were growing at a rate that is greater than Uruguay’s exports to the rest of the world. The most competitive market is Netherlands because its annual export growth was at 14% during the periods 2007 to 2011, but the biggest market exists in Germany with the world share of 20.6%.
73
Figure 39: Prospects for diversification of suppliers for unsweetened milk and cream imported by South Africa in 2011
Source: ITC Trademap
74
Figure 39 illustrates that Germany is not a big supplier of South Africa’s market for milk and cream (not concentrated or sweetened) but it is the world’s greatest exporter of milk and cream (not concentrated or sweetened) over the period 2007 to 2011. Even though Germany is the main supplier (20.6% share of world’s exports), its annual growth of 2% shows that it not easy for South Africa to penetrate its market. South Africa can diversify to Kenya which has the lowest world’s exports share of 0.1% but its annual growth is at 24%. South Africa can therefore penetrate this market if it wishes to diversify.
75
7.2.2. Milk and cream, concentrated or sweetened Table 29: List of supplying markets for the product imported by South Africa in 2011 South Africa’s imports represent 0.16% of world imports for milk and cream (concentrated or sweetened), its ranking in world imports is 76. Trade Indicators
Exporters
Imported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's imports (%)
Imported quantity 2011
Quantity unit
Unit value (USD/unit)
Imported growth in value between 2007-2011 (%, p.a.)
Imported growth in quantity between 2007-2011 (%, p.a.)
Imported growth in value between 2010-2011 (%, p.a.)
World
29463
-5214
100
8095
Tons
3640
-11
-10
29
France
5108
-5108
17.3
1453
Tons
3515
312
383
193
New Zealand
3625
-3625
12.3
907
Tons
3997
13
9
-15
Australia
3569
-3569
12.1
876
Tons
4074
-21
-18
Germany
2879
-2879
9.8
824
Tons
3494
1
Ireland
2479
-2479
8.4
700
Tons
3541
Belgium
2396
-2396
8.1
654
Tons
Lithuania
2186
-2186
7.4
668
Italy
1476
-1476
5
Argentina
1440
-1440
Netherlands
1107
Canada United Kingdom United States of America
1087
Ranking of partner countries in world exports
Share of partner countries in world exports (%)
Total export growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) applied by South Africa (%)
100
3
5
6.8
8
0
1
21.6
7
0
258
7
5.7
0
0
11
276
3
9.3
2
0
-20
-15
94
11
2.7
-2
0
3664
28
37
1
6
6
5
0
Tons
3272
19
36
25
0.5
1
0
279
Tons
5290
216
210
51
41
0.2
0
0
4.9
303
Tons
4752
-26
-31
25
8
3.6
21
0
-1107
3.8
290
Tons
3817
43
54
242
2
9.4
4
0
-1087
3.7
448
Tons
2426
-33
-24
-15
35
0.2
-15
0
1022
-1021
3.5
350
Tons
2920
25
39
-27
14
1.7
-3
0
517
-514
1.8
176
Tons
2938
-12
0
-74
4
8.8
8
0
Source: ITC calculations based on COMTRADE statistics.
76
Table 29 shows that during 2011 South Africa imported a total of 8 095 tons of milk and cream (concentrated or sweetened), at an average value of US$ 3 640/unit. South Africa imported greater quantities of milk and cream, (concentrated or sweetened) from France, New Zealand and Australia. The greatest share of South African milk and cream (concentrated or sweetened) imports originated from France which commanded 17.3% share during the year 2011 followed by New Zealand by12.3% and Australia by 12.1%. South Africa’s milk and cream (not concentrated or sweetened) imports decreased by 11% in value and 10% in quantity between the periods 2007 and 2011. During the same period, imports of milk and cream (concentrated or sweetened) from France also decreased by 312% in value and 383% in quantity; and New Zealand increased in value and quantity by 13% and 9% respectively. Between the periods 2010 and 2011, South Africa’s imports of milk and cream (concentrated or sweetened) increased by 29% in value. During the same period, France’s milk and cream (concentrated or sweetened) exports to South Africa increase 193% in value and New Zealand decreased by 15% in value during the same periods.
77
Figure 40: Competitiveness of suppliers to South Africa for sweetened milk and cream in 2011
Source: ITC Trademap
78
Figure 40 illustrates that between 2007 and 2011 South Africa’s milk and cream (concentrated or sweetened) imported from New Zealand, Argentina, Australia, United States of America, Canada, Germany, Nigeria, Nigeria, Switzerland, Ireland and Brazil were growing at a rate that is less than their export growth to the rest of the world. New Zealand is the most competitive market because its world share is 27.7% and its annual export growth is 15%. During the same period, South Africa’s milk and cream, concentrated or sweetened imports from Belgium, Netherlands, Lithuania, France, Italy, China and United Kingdom were growing at a rate that is greater than their exports to the rest of the world. Netherlands is the second competitive market with a world market share of 8.8% and an annual growth of 6%.
79
Figure 41: Prospects for diversification of suppliers for sweetened milk and cream imported by South Africa in 2011
Source: ITC Trademap
80
Figure 41 illustrates that New Zealand is not a big supplier of South Africa’s market for milk and cream (concentrated or sweetened) but it is the main world exporter and its market was growing (15%) over the period 2007 to 2011. New Zealand is therefore the biggest prospective supplier for South Africa’s milk and cream (concentrated or sweetened). The chart also shows that Nigeria has experienced highest annual exports growth rate of 116% during 2007 to 2011. It represents a small possible supplier for South Africa’s milk and cream (concentrated or sweetened).
81
7.2.3. Buttermilk and yoghurt Table 30: List of supplying markets for the product imported by South Africa in 2011 South Africa’s imports represent 0.17% of world imports for Buttermilk and yoghurt, its ranking in world’s imports is 60. Trade Indicators
Exporters
Imported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's imports (%)
Imported quantity 2011
Quantity unit
Unit value (USD/unit)
Imported growth in value between 2007-2011 (%, p.a.)
Imported growth in quantity between 2007-2011 (%, p.a.)
Imported growth in value between 2010-2011 (%, p.a.)
World
6679
11177
100
2130
Tons
3136
8
14
72
New Zealand
2996
-2956
44.9
841
Tons
3562
19
17
177
France
1105
-1105
16.5
344
Tons
3212
31
Ireland
675
-675
10.1
204
Tons
3309
132
Netherlands
514
-514
7.7
160
Tons
3213
Belgium
481
-481
7.2
152
Tons
3164
Spain United Kingdom United States of America
416
-416
6.2
270
Tons
1541
342
-340
5.1
108
Tons
3167
53
82
-82
1.2
37
Tons
2216
Germany
38
-38
0.6
7
Tons
5429
Saudi Arabia
17
52
0.3
4
Tons
South Africa
5
-5
0.1
3
Tons
Angola
4
8374
0.1
0
Tons
Ranking of partner countries in world exports
Share of partner countries in world exports (%)
Total export growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) applied by South Africa (%)
100
1
10
2.1
-13
0
31
2
19
3
0
42
171
14
1.5
-2
0
-12
-4
15
7
3
22
0
-23
-17
-14
3
9.3
-3
0
362
5
4.6
-8
0
57
-3
12
1.9
-1
0
-7
6
215
8
2.8
17
0
-10
-1
-72
1
22.3
-1
0
4250
21
0.8
1
0
1667
31
0.4
24
110
0
Source: ITC calculations based on COMTRADE statistics.
82
0
Table 30 shows that during 2011 South Africa imported a total of 2 130 tons of buttermilk and yoghurt, at an average value of US$ 3 136/unit. South Africa imported greater quantities of milk and cream, (concentrated or sweetened) from New Zealand, France and Ireland. The greatest share of South African buttermilk and yoghurt imports originated from New Zealand which commanded 44.9% share during the year 2011 followed by France by 16.5% and Irelands by 10.1%. South Africa’s buttermilk and yoghurt imports increased by 8% in value and declined by 14% in quantity between the periods 2007 and 2011. During the same period, imports of buttermilk and yoghurt from New Zealand also increased by 19% in value and 17% in quantity; and imports from France increased by 31% in quantity during the same periods. Between the periods 2010 and 2011, South Africa’s imports of buttermilk and yoghurt increased by 72% in value. During the same period, New Zealand, France and Ireland’s buttermilk and yoghurt exports to South Africa increased by 31%, 171 and 15% respectively.
83
Figure 42: Competitiveness of suppliers to South Africa for buttermilk and yogurt in 2011
Source: ITC Trademap
84
Figure 42 illustrates that between 2007 and 2011 South Africa’s buttermilk and yoghurt imported from Belgium, Germany, United States of America (USA) and Netherlands were growing at a rate that is less than their export growth to the world. During the same period, South Africa’s buttermilk and yoghurt imports from Ireland, New Zealand and United Kingdom were growing at a rate that is greater than their exports to the rest of the world. Germany is the most competitive market during the periods 2007 and 2011 due to its world share market of 21.7% followed at a distance by Belgium with the world market share of 9%.
85
Figure 43: Prospects for diversification of suppliers for buttermilk and yogurt imported by South Africa in 2011
Source: ITC Trademap
86
Germany is the biggest supplier of for buttermilk and yoghurt and has a share of 3.49% of South African’s imports (see Figure 43). Germany has an annual export growth of 0% which is a limiting factor for South Africa to penetrate the market. South Africa can diversify to the fastest growing markets of buttermilk and yoghurt which are Belarus and Ghana. They both experienced an annual export growth of 21% each. .
87
7.2.4. Whey and other natural milk products Table 31: List of supplying markets for the product imported by South Africa in 2011 South Africa’s imports represent 0.85% of world’s imports for whey and natural milk products; its ranking in world imports is 28. Trade Indicators
Exporters
Imported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's imports (%)
Imported quantity 2011
Quantity unit
Unit value (USD/unit)
Imported growth in value between 2007-2011 (%, p.a.)
Imported growth in quantity between 2007-2011 (%, p.a.)
Imported growth in value between 2010-2011 (%, p.a.)
World
26602
-24798
100
9446
Tons
2816
10
10
17
France
13337
-13337
50.1
4839
Tons
2756
8
12
55
New Zealand
3134
-3129
11.8
621
Tons
5047
47
38
Germany
3092
-3092
11.6
785
Tons
3939
49
Argentina
1728
-1728
6.5
605
Tons
2856
Ireland United States of America
1567
-1567
5.9
792
Tons
1566
-1566
5.9
312
Australia
764
-764
2.9
Denmark
630
-630
Poland
382
Lithuania Netherlands United Kingdom Belgium
Ranking of partner countries in world exports
Share of partner countries in world exports (%)
Total export growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) applied by South Africa (%)
100
1
3
13.5
-2
0
-15
5
8.8
-4
0
50
230
2
15.2
-3
0
-5
-11
282
9
2.3
11
0
1979
2
1
4
7
3.2
0
0
Tons
5019
86
49
-46
1
15.8
3
0
198
Tons
3859
-16
-20
-82
16
1.6
-9
0
2.4
620
Tons
1016
10
63
678
11
2.1
3
0
-382
1.4
366
Tons
1044
13
-5
1719
6
4
6
0
210
-210
0.8
182
Tons
1154
740
20
0.9
3
0
102
-102
0.4
51
Tons
2000
-31
-16
-38
4
9.5
0
0
77
-77
0.3
72
Tons
1069
-23
3
353
17
1.6
-6
0
10
-10
0
1
Tons
10000
-47
-67
10
2.2
10
0
Source: ITC calculations based on COMTRADE statistics.
88
Table 31 shows that during 2011 South Africa imported a total of 9 446 tons of whey and natural milk products, at an average value of US$ 2 816/unit. South Africa imported greater quantities of whey and natural milk products from France, New Zealand and Germany. The greatest share of South African whey and natural milk products’ imports originated from France which commanded 50.1% share during the year 2011 followed by New Zealand and Germany with 11.8 and 11.6% respectively. South Africa’s whey and natural milk products imports increased by 10% each in value and quantity between the periods 2007 and 2011. During the same period, imports of whey and natural milk products from France increased by 8% in value and 12% in quantity; and imports from New Zealand increased by 48% in value and 38%% in quantity. Germany experienced an increase of 49% in value and 50% in quantity during 2007 to 2011. Between the periods 2010 and 2011, South Africa’s imports of whey and natural milk products experienced an increase of 17% in value. During the same period, France’ whey and natural milk products exports to South Africa increased by 55% in value while imports from New Zealand decreased by 15% in value.
89
Figure 44: Competitiveness of suppliers to South Africa for whey in 2011
Source: ITC Trademap
90
Figure 44 illustrates that between 2007 and 2011 South Africa’s whey and natural milk products imported from Netherlands, Belgium, Argentina, United Kingdom and Australia were growing at a rate that is less than their export growth to the rest of the world. During the same period, South Africa’s whey and natural milk products imported from United States of America (USA), New Zealand, Germany, Denmark, Poland France and Ireland were growing at a rate that is greater than their exports to the rest of the world. The most competitive supplier of whey and natural milk products is USA which has a world‘s exports share of 15.2% followed by Germany by 14.6% and France by 12.9%. South Africa’s import growth from these countries were greater than their export growth to the world.
91
Figure 45: Prospects for diversification of suppliers for whey imported by South Africa in 2011
Source: ITC Trademap
92
South Africa is already importing from the biggest exporters of whey and natural milk products which are USA and Germany. USA has a world market share of 15.2% while Germany has a world market share of 14.6% during 2011. They have a share of South Africa’s imports of 5.89% and 11.62% respectively. South Africa can look on penetrating the market of these biggest markets or diversify to Republic of Korea which has an annual export growth rate of 29%. This is one of the smallest markets of whey and natural milk products with a world share of 0.2% but it is the fastest growing market. South Africa can therefore develop a new market in the Republic of Korea because currently it is not importing to South Africa.
93
7.2.5. Butter and other fats and oils derived from milk Table 32: List of supplying markets for the product imported by South Africa in 2011 South Africa’s imports represent 0.19% of world imports for butter and other fats and oils derived from milk, its ranking in world imports is 55. Trade Indicators
Exporters
World
Imported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's imports (%)
Imported quantity 2011
Quantity unit
Unit value (USD/unit)
Imported growth in value between 2007-2011 (%, p.a.)
Imported growth in quantity between 2007-2011 (%, p.a.)
Imported growth in value between 2010-2011 (%, p.a.)
13890
-9644
100
3153
Tons
4405
6
-3
46
New Zealand
9395
-9395
67.6
2416
Tons
3889
57
45
164
Ireland United States of America
2434
-2434
17.5
343
Tons
7096
-18
-33
-29
803
-801
5.8
200
Tons
4015
42
276
Denmark
777
-777
5.6
132
Tons
5886
14
3
Belgium
420
-420
3
53
Tons
7925
-4
-13
France United Kingdom
51
-51
0.4
7
Tons
7286
219
7
-7
0.1
1
Tons
7000
107
Argentina
1
-1
0
0
Tons
South Africa
1
-1
0
1
Tons
1000
Source: ITC calculations based on COMTRADE statistics.
94
Ranking of partner countries in world exports
Share of partner countries in world exports (%)
Total export growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) applied by South Africa (%)
100
8
1
19.1
12
0
3
11.1
8
0
9
3.6
14
0
-5
7
4.4
2
0
91
4
9.4
3
0
21
6
6.4
11
0
-76
11
2.9
12
0
15
1.1
10
0
42
0.1
15
Table 32 shows that during 2011 South Africa imported a total of 3 153 tons of butter and other fats, at an average value of US$ 4 405/unit. South Africa imported greater quantities of butter and other fats from New Zealand, Ireland and United States of America (USA). The greatest share of South African butter and other fats imports originated from New Zealand which commanded 67.6% share during the year 2011 followed by Ireland by 17.5% then USA by 5.8%. South Africa’s butter and other fats imports increased by 6% in value and declined by 3% in quantity between the periods 2007 and 2011. During the same period, imports of butter and other fats from New Zealand increased by 57% in Value and 45% in quantity while Ireland decreased in value and quantity by 33% and 29% respectively. USA experienced high increases of 42% in value and 276% in quantity. Between the periods 2010 and 2011, South Africa’s imports of butter and other fats increased by 45% in value. During the same period, New Zealand’s butter and other fats exports to South Africa increased by 164% in value while imports from Ireland decreased by 29%.
95
Figure 46: Competitiveness of suppliers to South Africa for butter in 2011
Source: ITC Trademap
96
Figure 46 illustrates that between 2007 and 2011 South Africa’s butter and other fats imported from Belgium and Ireland were growing at a rate that is less than their export growth to the rest of the world. During the same period, South Africa’s butter and other fats imports from France, United States of America (USA), Denmark, New Zealand and United Kingdom (UK) were growing at a rate that is greater than their exports to the rest of the world. New Zealand is the most competitive supplier of butter and other fats because its world market share is 24.3% and its annual exports growth increased by 20% and it imported 57% of butter and other fats to South Africa,.
97
Figure 47: Prospects for diversification of suppliers for butter imported by South Africa in 2011
Source: ITC Trademap
98
Figure 47 illustrates that New Zealand is the main supplier of world’s butter and other fats. If South Africa wishes to diversify from Mauritius and Kenya will be the prospective supplier due to its exports annual growth of 113% and 56% respectively. They are both small markets with the world share of less than a percent each but very attractive in export annual growths.
99
14.2.6. Cheese and Curd Table 33: List of supplying markets for the product imported by South Africa in 2011 South Africa’s imports represent 0.15% of world imports for Cheese and curd, its ranking in world imports is 61. Trade Indicators
Exporters
Imported value 2011 (USD thousand)
Trade balance 2011 (USD thousand)
Share in South Africa's imports (%)
Imported quantity 2011
Quantity unit
Unit value (USD/unit)
Imported growth in value between 2007-2011 (%, p.a.)
Imported growth in quantity between 2007-2011 (%, p.a.)
Imported growth in value between 2010-2011 (%, p.a.)
World
40342
-29093
100
6749
Tons
5977
11
9
21
Ireland
6650
-6650
16.5
1399
Tons
4753
56
63
73
New Zealand
5981
-5981
14.8
1317
Tons
4541
-1
-6
France
5712
-5712
14.2
609
Tons
9379
14
Italy
5517
-5517
13.7
485
Tons
11375
Denmark
2959
-2959
7.3
618
Tons
Australia
2452
-2452
6.1
478
Germany
2416
-2416
6
Netherlands
2015
-2015
5
Morocco United Kingdom United States of America
1882
-1882
1268 1017
Ranking of partner countries in world exports
Share of partner countries in world exports (%)
Total export growth in value of partner countries between 2007-2011 (%, p.a.)
Tariff (estimated) applied by South Africa (%)
100
4
8
3
3
0
8
9
2.8
-5
0
9
35
2
13.9
3
0
7
2
46
4
9.4
8
0
4788
7
9
8
5
5.2
1
0
Tons
5130
9
-1
5
10
2.8
0
0
427
Tons
5658
8
10
10
1
16.8
4
0
328
Tons
6143
14
21
45
3
12.1
-1
0
4.7
272
Tons
6919
2
-5
22
43
0.1
-6
0
-1267
3.1
162
Tons
7827
26
36
31
12
2.3
6
0
-1017
2.5
301
Tons
3379
18
17
-63
6
3.4
22
0
Source: ITC calculations based on COMTRADE statistics.
100
Table 33 shows that during 2011, South Africa imported a total of 6 749 tons of cheese and curd, at an average value of US$ 5 977/unit. South Africa imported greater quantities of cheese and curd from Ireland, New Zealand, France, and Italy. The greatest share of South African cheese and curd imports originated from Ireland which commanded 16.5% share during the year 2011 followed by New Zealand by 14.8%, France (14.2%) and Italy (by 13.7%. South Africa’s cheese and curd imports increased by 11% in value and 9% in quantity between the periods 2007 and 2011. During the same period, imports of cheese and curd from Ireland increased by 56% in value and 63% in quantity; imports from New Zealand decreased by 1% in value and 6% in quantity; and imports from France increased by 14% in value and by 9% in quantity. Between the periods 2010 and 2011, South Africa’s imports of cheese and curd increased by 21% in value. During the same period, Ireland’s cheese and curd exports to South Africa increased by 37% in value and imports from New Zealand increased by 8% in value while those from France also increased by 35%.
101
Figure 48: Competitiveness of suppliers to South Africa for cheese and curd in 2011
Source: ITC Trademap
102
Figure 48 illustrates that between 2007 and 2011 South Africa’s cheese and curd imported from Switzerland, Italy, United States of America (USA) , Egypt and Belgium were growing at a rate that is less than their export growth to the rest of the world. During the same period, South Africa’s cheese and curd imports from Australia, Austria, Portugal, Canada, Morocco, Netherlands, Germany, Argentina, Spain, Denmark, France, Lithuania, Ireland and United Kingdom were growing at a rate that is greater than their exports to the rest of the world. The most competitive suppliers of cheese and curd are Germany, Netherlands and France with the world export market share of 16.3%, 13.7% and 13.4% respectively during the period 2007 to 2011.
103
Figure 49: Prospects for diversification of suppliers for cheese and curd imported by South Africa in 2011
Source: ITC Trademap
104
South Africa’s imports of Cheese and Curd are from the biggest and fastest growing markets in the world. If there is a need for South Africa to diversify, United States of America will be the most attractive market due its highest annual export growth of 22% and has a world market share of 3.3%.
8.
ACKNOWLEDGEMENTS
1. Statistics and Economic Analysis. www.daff.gov.za.
8. Milk Producers Organization (MPO). Dr Koos Coetzee 012-8435600 www.mpo.co.za
2. Clover Roodepoort South Africa 1715 Tel: +27 (11) 471 1400 Fax: +27 (11) 471 1504 www.clover.co.za 3. Competition Commission Tel: 012 394 3300 Fax: 012 394 0169 www.comptrib.co.za.
9. National Agricultural Marketing Council (NAMC). Tel: (012) 3411115 Fax: (012) 3411911 www.namc.co.za 10.
Nestle P O Box 50661, Randburg, 2125 Fax: (011) 889 6559 086 009 6116 (General) 086 009 6789 (Nutrition) 0800 001 691 (Pet Care) www.nestle.co.za
11.
Parmalat SA(PTY)LTD Stellenbosch 7600 Tel: +27 21 809 1400 Fax: +27 21 809 1518 www.parmalat.co.za
6. LactoData www.dairyconnect.co.za.
12.
7. MacMap www.macmap.org
Quantec. www.Quantec.co.za.
13.
Trade & Industrial Policy Strategies (TIPS) www.tips.org.za.
4. Dairy Belle (PTY) LTD Private Bag 208 Bryanston 2021 Tel: 011 840 4000 Fax: 011 514 0084 www.dairybelle.co.za 5. International Trade Center www.trademap.org
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Disclaimer: This document and its contents have been compiled by the Department of Agriculture, Forestry and Fisheries for the purpose of detailing the dairy industry. The views expressed in this document are those of the Department of Agriculture, forestry and fisheries with regard to agricultural industry, unless otherwise stated and, therefore the Department of Agriculture, forestry and fisheries does not accept responsibility for any errors in such information and anyone acting on such information does so entirely at his or her own risk.
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