CABBAGE VALUE CHAIN PROFILE

1. DESCRIPTION OF THE INDUSTRY

Cabbage belongs to a class of vegetables called Brassica, also known as
cruciferous vegetables because their flowers are cross-shaped. Other crucifers
are broccoli, kale, cauliflower and Brussels sprouts. As with most vegetable
crops, cabbages are mostly produced for and marketed through the national
fresh produce markets, the informal market and chain stores. Cabbage is used
raw in salads, such as coleslaw, as a cooked vegetable, or preserved in pickles or
sauerkraut. Cabbage is 90% water and an excellent source of minerals, Vitamin
A and C and the B vitamins.

Figure 1: Gross Value of Production

160000000
140000000
120000000
100000000
Rand

80000000
60000000
40000000
20000000
0

99 00 01 02 03 04 05 06 07 08
19 20 20 20 20 20 20 20 20 20
Years

Source: Agricultural Statistics

Figure 1 above illustrates the contribution of the cabbage industry to the gross
value of agricultural production over 10 years period. The industry contribution
has increased steadily from 2000 to 2003. There was a sharp decline in gross
value due to high production which occurred while the prices were not favorable
for the producers. From 2005, the gross value increased steadily reaching the
peak in 2007. In 2008, there was 10% decline in contribution due to decline in
producer price in the same year.

1.1 Production areas

Cabbage grows best under cool conditions cabbage .Cabbages are produced in
all provinces of South Africa but the production is concentrated in Western Cape,
Kwazulu Natal, Eastern Cape, Gauteng , Free State and North West provinces.
Globally, China is a leader in production of cabbages, followed by India and
Russian Federation.

1
1.2 Production trends
Figure 2: Cabbage production
250000

200000

150000
Tons

100000

50000

0
99 00 01 02 03 04 05 06 07 08
19 20 20 20 20 20 20 20 20 20
Years

Source: Agricultural Statistics

Figure 2, illustrate the production volumes over the past ten years. Peak
production volumes were recorded in 1999, and then from 2000 to 2003 there was
a steady decline in production volume. In 2004, the production increased slightly
and then from 2005 the production declined significantly with 2007 having
lowest production volumes. In 2008, there was a slight increase in production.
The decline in production can be attributed to increasing high production input
costs and unfavorable climatic conditions.

Figure 3: Production vs Consumption

250000

200000

150000
Tons

100000

50000

0
99 00 01 02 03 04 05 06 07 08
19 20 20 20 20 20 20 20 20 20
Year
Production (Tons) Consumption (Tons)

Source: Agricultural Statistics

Figure 3 above, depicts local consumption of cabbage compared to the

production over the 10 years period. South African average cabbage
consumption is approximately 163 838 tons per annum. The figure illustrates
that the production of cabbage is slightly higher than the consumption. Most of

2
cabbages are produced for domestic consumption. South Africa is self sufficient
in terms of cabbage production and the surplus is also exported.

2. MARKET STRUCTURE

The cabbage industry operates in the deregulated environment where the prices
are determined by the forces of demand and supply. Fresh cabbages are sold
through fresh produce market, processors, restaurants, hawkers, retailers and
chain stores. Cabbages are also exported to other countries through export agents
and marketing companies. South Africa also imports from other countries.

2.1 Domestic market and prices

Table 1: Cabbage sold through different market channels

National fresh
produce markets Exports Processing
Years (tons) (Kg) (tons)
1999 171441 414520 2185
2000 154488 476336 1829
2001 150229 1029939 1568
2002 148129 485362 1647
2003 142367 801855 1970
2004 144172 814325 1339
2005 129261 604853 1069
2006 117433 752969 1452
2007 108300 1004202 2357
2008 115333 1032001 1566
Source: Agricultural Statistics

Table 1 above, illustrates the sales of cabbage through various marketing

channels over ten years period. National Fresh Produce Market remains an
important channel for the sale of fresh cabbage in South Africa. In 2008,
approximately 83% of cabbages were distributed through fresh produce markets.
The remaining 17% represent direct sales from producer to wholesalers, retailers,
processors, informal traders and consumers.

3
 Figure 4: Sales of cabbage at the national fresh produce markets
200000 R 1,400
180000
R 1,200
160000
140000 R 1,000

Rand/ton
120000
Tons

R 800
100000
80000 R 600
60000 R 400
40000
R 200
20000
0 R0

99 00 0 1 02 0 3 0 4 05 0 6 07 08
19 20 20 20 20 20 20 20 20 20
Years
Volume (Tons) Price (Rand/Ton)

Source: Agricultural Statistics

Figure 4 above illustrate the sales of cabbage in the national fresh produce
market over the period of 10 years. In 1999 the cabbages were sold at the lowest
prices due to high volumes of cabbage supplied in the same period. From 2000 to
2003 the prices increased steadily due to a steady decline in volumes in the same
period. In 2004, the price dropped by 26% when compared to a price in the
previous year due to increased cabbage volumes across the markets. From 2005
prices increased steadily and the highest price was recorded in 2007 as the
volumes decreased significantly across the markets. In 2008, the price dropped
by 16% due to slight increase in volumes.

2.2 South Africa Cabbage Exports

South Africa is not a major cabbage exporter, it represent 0.13% of world exports
and its ranked number 36 in the world. Most of cabbage produced is destined
for domestic markets. South African cabbage exports were destined to United
Kingdom, Netherlands, Angola, Mozambique, France, Mauritius, and
Democratic Republic of the Congo. Figure 5 below illustrates South Africa
cabbage export destinations.

4
 Figure 5: South Africa cabbage exports destinations in 2008

Japan
DRC
Mauritius 2% Switzerland
2%
3% 1%
Other
France 3% 2%
Mozambique
5%
United Kingdom
Angola 5%
52%
Ship stores and
bunkers
10% Netherlands 15%

Source: Trade Map

Table 2: South Africa major cabbage exports destinations in 2008

Exported
Exported growth
growth in Exported
Exported Share in in value quantity growth in
value South Export Unit between between value
2008, Africa's ed value, 2004- 2004- between
USD exports, quantit (USD/ 2008, 2008, %, 2007-2008,
Importers thousand % y 2008 unit) %, p.a. p.a. %, p.a.
World 2476 100 2421 1023 15 13 16
United
Kingdom 1298 52.4 851 1525 3 2 91
Netherlands 372 15 351 1060 17 28 -41
Ship stores
and bunkers 253 10.2 353 717 90 77 -12
Angola 124 5 224 554 10 6 -2
Mozambique 115 4.6 354 325 35 19 21
France 82 3.3 76 1079 222 255 14
Mauritius 61 2.5 82 744 50 85 -20
DRC 46 1.9 30 1533 63 52 -19
Japan 44 1.8 37 1189 1367
Switzerland 30 1.2 24 1250 57 -27
Seychelles 19 0.8 8 2375 26 10 138
United Arab
Emirates 9 0.4 2 4500 5 3 80
Congo 7 0.3 8 875 73 72 40
Zambia 5 0.2 12 417 20 64 150
Germany 2 0.1 1 2000 -31 -14 -88
Nigeria 2 0.1 2 1000 -23 -60
Source: Trade Map

5
Table 2 indicates that during 2008, South Africa exported higher quantities of
cabbages to United Kingdom and Netherlands. United Kingdom commanded
52.4% and Netherlands commanded 15% share of South African cabbage exports.
Cabbage exports to United Kingdom have grown by 91% in value between 2007
and 2008 period. South African exports to Germany have decreased by 31% and
14%, in value and quantity respectively between 2004 and 2008. This can be
attributed to the decline in production between 2004 and 2008.

Figure 6: Cabbage exports by South Africa

1200000 7000000
1000000 6000000

800000 5000000
4000000

Rand
Kg

600000
3000000
400000 2000000
200000 1000000
0 0

99 00 01 02 03 04 05 06 07 08
19 20 20 20 20 20 20 20 20 20
Years
Volume (Kg) Value (Rand)

Source: Quantec Research

Figure 6, illustrate cabbage exports from South Africa over the past 10 years. The
export increased significantly in 2001, 2007 and 2008 despite the decline in
production volumes in the same years. It was generally less profitable to export
cabbage in the past between 10 years except for 2005, since lower export value
were recorded for relatively higher volumes exported.

6
 Figure 7: Value of cabbage exports by SA Provinces

16000000
14000000
12000000
Value (Rand)

10000000
8000000
6000000
4000000
2000000
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Years
Western Cape 626024 542027 3685181 1230239 2741744 2817791 4946787 11408841 6190831 14089526
Free State 23727 605559 827074 3102454 2511020 1960066 0 0 0 1843720
Kw azulu-Natal 0 0 30749 63026 108973 7643 838677 310403 2075973 385833
Gauteng 756005 1446832 352621 1272876 1917941 3634650 6408896 3242939 6706356 3923071
Mpumalanga 89738 0 3781 0 0 0 0 156803 0 0

Source: Quantec Research

Figure 7, above illustrate the cabbage exports by the provinces of the past ten
years. The highlights of cabbage exports were that of Western Cape, Gauteng,
Free State and Kwazulu Natal to a lesser extent. The high export values from
Western Cape, Gauteng, and KwaZulu Natal can be attributed to the export exit
points, Cape Town harbour, OR Tambo International Airport and Durban
harbour. The following figures (figure 7-12) show the value of cabbage exports
from the various districts in all Provinces in South Africa.

Figure 8: Value of cabbage exports by Western Cape Province

10000000

8000000
Value (Rand)

6000000

4000000

2000000

0
Years 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

City of Cape Tow n 626024 542027 3685181 1230239 2741269 2417075 4764882 7549337 5226628 5770554
West Coast 0 0 0 0 0 0 0 0 0 22957
Overberg 0 0 0 0 475 0 0 0 0 0
Eden District 0 0 0 0 0 400715 181905 3859504 964203 8296015

Source: Quantec Research

7
Figure 8 above, indicates that cabbage exports from Western Cape Province were
mainly from City of Cape Town and Eden district municipalities. The highest
export value was recorded in 2008 from Eden municipality.

Figure 9: Value of cabbage exports by Kwazulu Natal province

2500000
Value (Rand)

2000000

1500000

1000000

500000

0
Years 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Umzinyathi 0 0 0 0 39424 0 0 0 0 0
Uthungulu 0 0 17103 9373 0 204 11357 10 0 0
Ethekw ini 0 0 13645 53653 69549 7439 827320 310394 2075973 385833

Source: Quantec Research

Figure 9, above indicates that cabbage exports from Kwazulu Natal Province
were mainly from Ethekwini and Uthungulu Municipalities. The significant
export values were in 2005 and 2007 from Ethekwini Municipality.

Figure 10: Value of cabbage exports by Gauteng Province

7000000
Value (Rand)

6000000
5000000
4000000
3000000
2000000
1000000
0
Years 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Sedibeng District 0 0 0 0 0 0 0 375 0 0

West Rand 0 2322 0 56056 0 0 0 0 0 0
Ekurhuleni 0 21896 18086 89 987631 32432 83280 74162 353314 370501
City of Johannesburg 756005 1408166 334534 778350 930311 36022186325616 31667166291481 3544882
City of Tshw ane 0 14449 0 438381 0 0 0 1686 61557 7688

Source: Quantec Research

As can be seen from figure 10 above, cabbage exports from Gauteng Province are
mainly from the City of Johannesburg municipality and Ekurhuleni

8
municipality. City of Tshwane municipality contributed to a lesser extent. The
high exports values were recorded 2005 and 2007 from City of Johannesburg
municipality.

Figure 11: Value of cabbage exports by Free State Province

3000000
2500000
Value (Rand)

2000000
1500000
1000000
500000
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Years
Motheo District 0 0 0 0 0 0 0 0 0 1843720
Lejw eleputsw a 0 475926 310624 2850714 2511020 515966 0 0 0 0
Thabo Mofutsanyane 23727 129632 516450 251741 0 1444100 0 0 0 0

Source: Quantec Research

Figure 11 above, shows that cabbage exports from Free State Province are mainly
from Lejweleputswa and Thabo Mofutsanyane Municipalities. The significant
exports values were recorded in 2002 and 2003 from Lejweleputswa district
municipality.

Figure12 : Value of cabbage by M pumalanga Province

180000
160000
Value (Rand)

140000
120000
100000
80000
60000
40000
20000
Years 0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Gert Sibande 0 0 0 0 0 0 0 0 0 0
Nkangala 0 0 0 0 0 0 0 2774 0 0
Ehlanzeni 89738 0 3781 0 0 0 0 154029 0 0

Source: Quantec Research

9
Figure 12 above, shows that the cabbage exports from Mpumalanga Province are
mainly from Ehlanzeni Municipality. The highest cabbage export value was
recorded in 2006.

2.2.1 Share Analysis

Table 3 illustrates the provincial share towards national cabbage exports.
Western Cape, Gauteng, Free State and KwaZulu-Natal commanded the greatest
share of exports. The high exports share in Western Cape, Kwazulu Natal and
Gauteng can be attributed to registered exporters and exports exit points based
in these provinces. In 2008, Western Cape province commanded 69.60% share of
South Africa cabbage exports.

Table 3: Share of provincial cabbage exports to the RSA cabbage exports (%)
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Province
Western
Cape 41.86 20.89 75.22 21.70 37.66 33.46 40.57 75.46 41.35 69.60
Free State 1.59 23.34 16.88 54.73 34.49 23.28 0 0 0 9.11
Kwazulu-
Natal 0 0 0.63 1.11 1.50 0.09 6.88 2.05 13.86 1.91
Gauteng 50.55 55.77 7.20 22.45 26.35 43.17 52.56 21.45 44.79 19.38
Mpumalanga 6 0 0.08 0 0 0 0 1.04 0 0
South Africa 100 100 100 100 100 100 100 100 100 100
Source: Calculated from Quantec Research

Table 4: Share of district cabbage exports to the total Western Cape Provincial
cabbage exports (%)
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
District
City of Cape
Town 100 100 100 100 99.98 85.78 96.32 66.17 84.43 40.96
West Coast 0 0 0 0 0 0 0 0 0 0.16
Overberg 0 0 0 0 0.02 0 0 0 0 0
Eden District 0 0 0 0 0 14.22 3.68 33.83 15.57 58.88
Western Cape 100 100 100 100 100 100 100 100 100 100

Table 4 above, indicates that City of Cape Town and Eden to a lesser extent
commanded the greatest share of cabbage exports from Western Cape Province.
Cape Town harbour renders exit point of cabbage exports. In 2008 commanded
58.88% share of Western Cape Provincial cabbage export.

10
Table 5: Share of district cabbage exports to the Kwazulu Natal Provincial
cabbage exports (%)
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
District
Umzinyathi 0 0 0 0 36.18 0 0 0 0 0
Uthungulu 0 0 55.62 14.87 0 2.67 1.35 0 0 0
Ethekwini 0 0 44.38 85.13 63.82 97.33 98.65 100 100 100
Kwazulu Natal 0 0 100 100 100 100 100 100 100 100
Source: Calculated from Quantec Research

Table 5 above, indicates that Ethekwini and Uthungula commanded the greatest
share of cabbage exports from Kwazulu Natal Province. The greatest share by
Ethekwini can be attributed to Durban harbour which renders exports exit point.

Table 6: Share of district cabbage exports to the Gauteng Provincial cabbage

exports (%)
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
District
Sedibeng
District 0 0 0 0 0 0 0 0.01 0 0
West Rand 0 0.16 0 4.40 0 0 0 0.0 0 0
Ekurhuleni 0 1.51 5.13 0.01 51.49 0.89 1.30 2.29 5.27 9.44
City of
Johannesburg 100 97.33 94.87 61.15 48.51 99.11 98.70 97.65 93.81 90.36
City of Tshwane 0 1.00 0 34.44 0 0 0 0.05 0.92 0.20
Gauteng 100 100 100 100 100 100 100 100 100 100
Source: Calculated from Quantec Research

Table 6 above, indicates that City of Johannesburg and Ekurhuleni commanded

the greatest share of cabbage exports by Gauteng Province. OR Tambo
International Airport renders exit point of cabbages exports from Gauteng
Province.

Table 7: Share of district cabbage exports to the Free State Provincial cabbage
exports (%)
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
District
Motheo
District 0 0 0 0 0 0 0 0 0 100
Lejweleputswa 0 78.59 37.56 91.89 100 26.32 0 0 0 0
Thabo
Mofutsanyane 100 21.41 62.44 8.11 0 73.68 0 0 0 0
Free State 100 100 100 100 100 100 0 0 0 100
Source: Calculated from Quantec Research

11
Table 7 above, indicate that Lejweleputswa and Thabo Mofutsanyane
commanded the greatest share of cabbage exports from Free State Province.

Table 8: Share of district cabbage exports to the Mpumalanga Provincial

cabbage exports (%)
Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
District
Gert Sibande 0 0 0 0 0 0 0 0 0 0
Nkangala 0 0 0 0 0 0 0 1.77 0 0
Ehlanzeni 100 0 100 0 0 0 0 98.23 0 0
Mpumalanga 100 0 100 0 0 0 0 100 0 0
Source: Calculated from Quantec Research

2.3 South Africa Cabbage Imports

Figure 13 :Cabbage imports by South Africa
35000 45000
30000 40000
35000
25000
30000

Rand
20000 25000
Kg

15000 20000
15000
10000
10000
5000 5000
0 0

99 00 01 02 03 04 05 06 07 08
19 20 20 20 20 20 20 20 20 20
Years
Volume (Kg) Value (Rand)

Source: Agricultural Statistics & Quantec Research

Figure 13 above, shows that cabbage imports were relatively unstable for the past
10 years and the significant imports were in 2004, 2005 and 2006. The increase is
imports in 2005 can be attributed to the slightly decrease in production of
cabbage in the same year and it was also cheap to import since higher volumes
were imported at a lower value. In 1999, 2001, 2002,2006 and 2008 it was
expensive to import cabbage since less volumes were imported at higher values.

2.4 Processing

Fresh cut cabbage is used raw in salads such as coleslaw and as cooked vegetable
(added to soups or stews). Cabbage is also dehydrated (dried, flaked or power)
for use as a flavoring agent in soups and as an ingredient in other dehydrated

12
 foods. Cabbage leaves are used to treat acute inflammation. A paste of raw
cabbage may be placed in a cabbage leaf and wrapped around the affected area
to reduce discomfort. Cabbage can also be canned, prickled, frozen and cabbage
juice can be extracted to make ink. In 1999, 2003 and 2007 there has been a
considerable increase in volumes that were canned. There were juice extraction
activities in 1999 and 2002. In 2003 and 2004 there was no cabbage freezing
activities recorded. In 2008, there was a 33% in cabbage volume that was
processed when compared to 2007 production year.

Table 8: Processed cabbages

Canning Juices Freezing Dehydration Total processing
Years
Volume Value Volume Value Volume Value Volume Value Volume Value
(Tons) ( Rands) (Tons) (Rands) (Rands) ( Rands) ( Tons) ( Rands) ( Tons) ( Rands)
1999 1384.7 R 631,053 82.8 R29,062 155.2 R 74,394 562.5 R 115,283 2185.2 R 849,792
2000 933.4 R 370,335 0 0 342.8 R 115,814 552.9 R 504,116 1829.1 R 990,266
2001 412.5 R 290,757 0 0 678.7 R 256,794 476.5 R 269,197 1567.7 R 816,748
2002 807.2 R 778,573 10 R 5,010 673.5 R 244,610 156.2 R 33,596 1646.9 R 1,061,788
2003 1125 R 1,172,880 0 0 0 R0 845.4 R 211,360 1970.4 R 1,384,240
2004 934.5 R 1,168,618 0 0 0 R0 404.9 R 109,330 1339.4 R 1,277,947
2005 928.1 R 1,284,425 0 0 105.6 R 52,428 35 R 10,158 1068.7 R 1,347,010
2006 993.8 R 1,361,082 0 0 112.5 R 60,420 345.9 R 103,791 1452.2 R 1,525,294
2007 1333 R2,120,016 0 0 186 R117,952 839 R259 928 2357 R2,497,896
2008 1116 R1,503,537 0 0 182 R140,688 269 R85,759 1566 R1,729,984

Source: Agricultural Statistics

13
2.5 Cabbage value chain tree explaining its uses

Freezing Cabbage
Soup Atchaar

Dehydration Fresh cabbage Canning

Flaked
Juice Prickled
cabbage

Cabbage
salads Ink

14
2.6 Market value chain for cabbage

Input suppliers Farmers/Producers

Harvesting

Handling/Cooling

Quality grade standards

and packaging
Imports

Storage and
distribution

Exporters

Fresh produce markets,

Wholesalers,
Supermarkets, Retailers Processors: Dehydration,
and informal markets Freezing and juice
extraction

Consumers

The cabbage value chain can be broken down into the following levels: the
producers of cabbage (farmers); pack house owners (cleans, grade and quality
control); cold storage and transport facilities (store and transport cabbage on
behalf of farmers); traders in cabbage (market and sell cabbages); processors (add
value to cabbage and process cabbage to other usable forms); and end users
(consumers).

15
3. Market intelligence

3.1 Tariffs
Table 9: Tariffs applied by various exports markets for cabbage from South
Africa.
Estimated total
ad valorem
Product Applied equivalent
description Trade regime tariff tariff
Country (H07490) description
United States of Cabbage fresh MFN duties $5.40/ton 0.91%
America (2008) or chilled (Applied)
France White or red Preferential tariff 1.20% 1.20%
( 2009) cabbage fresh or for South Africa
chilled
Mozambique White or red MFN duties 20.00% 20.00%
( 2007) cabbage fresh or (Applied)
chilled
Singapore Cabbage fresh MFN duties 0.00% 0.00%
( 2008) or chilled (Applied)
United(2009) White or red Preferential tariff 1.20% 1.20%
Kingdom cabbage fresh or for South Africa
chilled
Angola (2008) Cabbage fresh MFN duties 15.00% 15.00%
or chilled (Applied)
Germany White or red Preferential tariff 1.20% 1.20%
( 2009) cabbage fresh or for South Africa
chilled
Netherlands White or red Preferential tariff 1.20% 1.20%
( 2009) cabbage fresh or for South Africa
chilled
Malaysia Cabbage fresh MFN duties 0.00% 0.00%
(2007) or chilled (Applied)
Sweden White or red MFN duties $5.21/ton 12.00%
( 2009) cabbage fresh or (Applied)
chilled
Thailand Cabbage fresh MFN duties $108.18/ton 42.34%
(2005) or chilled (Applied)
Switzerland Cabbage fresh MNF duties $26.19/ton 4.62%
(2009) or chilled (Applied)
Mauritius (2009) Cabbage fresh MNF duties 0.00% 0.00%
or chilled (Applied)
Canada (2008) Cabbage fresh MFN duties $18.10 or 6.00%
or chilled ( Applied) 6.00%
Russian (2009) Cabbage fresh General tariff 0.00% 0.00%
Federation or chilled

16
Hong Kong Cabbage fresh MFN duties 0.00% 0.00%
(2009) or chilled (Applied)
Japan (2008) Cabbage fresh MNF duties 3.00% 3.00%
or chilled (Applied)
DRC (2009) Cabbage fresh MNF duties 10.00% 10.00%
or chilled (Applied)
Belgium (2009) White or red Preferential tariff 1.20% 1.20%
cabbage fresh or for South Africa
chilled
Congo (2007) Cabbage fresh MNF duties 30.00% 30.00%
or chilled (Applied)
Source: Market Access Map

The lucrative exports markets for cabbage from South Africa exist in Singapore,
Mauritius, Russian Federation, Malaysia and Hong Kong since these countries
apply zero tariffs to cabbage exports originating from South Africa. In European
markets (France, United Kingdom, Germany, Netherlands and Sweden)
preferential tariff of 1.20% is applied to cabbage exports originating from South
Africa due to EU-SA Free Trade Agreement (FTA). African markets in Angola,
Congo and Mozambique are protected by 15%, 30% and 20% tariffs respectively
in spite of the existence of the SADC-FTA

3.2 Non tariff barriers

3.2.1 The European Union

Non-tariff barriers can be divided into those that are mandatory and laid out in
the EU Commission’s legislature, and those that are as a result of consumers,
retailers, importers and other distributions’ preferences.

3.2.2 Product legislation: quality and marketing

There are a number of pieces of EU legislation that govern the quality of produce
that may be imported, marketed and sold within the EU.

General Food Law covers matters in procedures of food safety and hygiene
(micro-biological and chemical), including provisions on the traceability of food
(for example, Hazard Analysis and Critical Control Points, of HACCP).

EU Marketing Standards, which govern the quality and labeling of vegetables,

are laid out in the CAP framework under regulation EC 2200/96. These
regulations include diameter, weight and class specifications, and any produce
that does not comply with these standards are not allowed to be sold on the EU

17
markets (detailed lists of products and their standards can be found in the
annexes to the directive). The legislation (under EU 1148/2001) also dictates that
a Certificate of Conformity must be obtained by anyone wishing to export and
sell vegetables in the EU, if that particular vegetable falls under the jurisdiction
on the EU marketing standards, Vegetables to be used in further processing
needs a Certificate of Industrial Use, whilst another legislative directive covers
the Maximum Residue Limits (MRL) of various pesticides allowed.

3.2.3 Product legislation: phytosanitary regulations

The international standard for phytosanitary measures was set up by the

International Plant Protection Committee (IPPC) to protect against the spreading
of diseases or insects through the importation of certain agricultural goods. The
EU has its own particular rules formalized under EC 2002/89, which attempts to
prevent contact of EU crops with harmful organisms from elsewhere in the
world.

The crux of the directive is that it authorizes the Plant Protection Services to
inspect a large number of vegetable products upon arrival in the EU. This
inspection consists of a physical examination of a consignment deemed to have a
level of phytosanitary risk, identification of any harmful organisms and
certification of the validity of any phytosanitary certificate covering the
consignment. If the consignment does not comply with the requirements, it may
not enter the EU, although certain organisms can be fumigated at the expense of
the exporter.

3.2.4 Product legislation: packaging

The EU commission lays downs rules for materials that come into contact with
food and which may endanger people’s health or bring about an unacceptable
change in the composition of the foodstuffs. The framework legislation for this
EC 1935/2004. Recycling packaging materials are also emphasized under
94/62/EC, whereby member states are required to recycle between 50% and 65%
of packaging waste. If exporters do not ship produce in packaging which is
reusable, they may be liable for the costs incurred by the importing companies.
Wood packaging is subject to phytosanitary controls (see Directive EC 2002/89)
and may need to undergo heat treatment, fumigation, etc.

3.2.5 Non-legal market requirements: social and environmental accountability

To access a market, importers must not only comply with the legal requirements
set out above, but also with market requirement s and demands. For the most
part, these revolve around quality and the perceptions of European consumers

18
about the environmental, social, health and safety aspects of both the products
and the production techniques. Whilst supplying vegetables that complies with
these issues may not be mandatory in the legal sense, they are becoming
increasingly important in Europe and cannot be ignored by existing or potential
exporters.

(i) Social responsibility is becoming important in the industry, not only amongst
consumers, but also for retail outlets and wholesalers. The Social Accountability
8000 (SA8000) certification is a management system based on International
Labour Organization (ILO) conventions, and deals with issues such as a child
labour, health and safety, and freedom of association, and requires an on-site
audit to be performed annually. The certificate is seen as necessary for accessing
any European market successful. The major retailers in the EU also play an
important role in tackling environmental issues, which means that exporters
have to take these into account when negotiating exporting arrangements.

(ii) Environmental issues are becoming increasingly important with European

consumers. Consumer movements are lobbying against purchasing non-
environmental friendly or non-sustainable produce. To this end, both
governments and private partners have created standards (such as ISO 14001
and EUREPGAP) and labels to ensure produce adhere to particular
specifications. Labels are an absolute must for exporters attempting to enter the
rapidly expanding organic produce market. The EU Commission has recently
adopted and EU label for identifying food produced according to EU organic
standards in the directive EEC 209/91

3.2.6 Consumer health and safety requirements

Increasing consumer conscience about health and safety issues has prompted a
number of safety initiatives in Europe, such as EUREPGAP on good agricultural
practices (GAP) by the main European retailers, the international management
system of HACCP, which is independently certified and required by legislation
for European producers as well as food imported into Europe (EC 852/2004),
and the ISO 9000 management standards system (for procedures and working
methods), which is certified by the International Standards Organization (ISO).

3.3 The United States

The USDA has quality standards for vegetables that provide a basis for domestic
and international trade and promote efficiency in marketing and procurement.
At the same time the USDA issues quality certificates based on these standards
and a comprehensive grading system. Graders are located around the country at
terminal markets. These certification services, which facilitate the ordering and
purchasing of products by large-volume buyers, assure these buyers that the

19
product they purchase will meet the terms of the contract in terms of quality,
processing, size, packaging and delivery.
3.4 Asian Market Access

Japan’s agricultural sector is heavily protected, with calculations from the

Organization for Economic Co-operation and Development (OECD) estimating
that almost 60% of the value of Japan’s farm production comes from trade
barriers or domestic subsidies. Japan uses tariff rate quotas (TRQ) to protect its
most sensitive products, and reserves the right for trading many of these
products (within the quota) for one or two state trading enterprises. However,
these extremely protective measures apply only to some products; others are able
to compete more effectively with outside competition, often on the grounds of
higher quality.

Perhaps the biggest barrier to trade with Japan in vegetable markets is its strict
phytosanitary requirements, which have often been challenged in the WTO as
having little or no scientific justification. Other measures that are being
challenged include Japan’s use of fumigation on agricultural products when
cosmopolitan pests (already found in Japan) are detected. Japan is also increasing
its labeling requirements.

4. GENERAL DISTRIBUTION CHANNELS

There are roughly three distinct sales channels for exporting vegetables. One can
sell directly to an importer with or without the assistance of an agent (usually
larger, more established commercial farms/orchards). One can supply a
vegetable combine, which will then contract out importers/marketers and try to
take advantage of economies of scale and increased bargaining power. At the
same time vegetable combines might also supply large retail chains. One can
also be a member of a private or co-operate export organization (including
marketing boards) which will find agents or importers and market the produce
collectively. Similar to a vegetable combine, an export organization can either
supply wholesale markets or retail chains depending on particular
circumstances. Export organizations and marketing boards will wash, sort and
package the produce.

20
5. LOGISTICAL ISSUES

5.1 Mode of transport

The transportation of vegetables falls within two categories – ocean cargo and air
cargo – with ocean cargo taking much longer to reach the desired location but
costing considerably less. Of course, the choice of transportation method
depends, for the most part, on the fragility of the produce and how long it can
remain relatively fresh. With the advent of technology and container
improvements, the feasibility, cost and attractiveness of sea transportation have
improved considerably. As more developing countries begin to export and
supply major developed countries markets, so the number and regularity of
maritime routes, and the container vessels travelling these routes, increase.

Presently South American countries like Peru benefit from the asparagus trade,
which has lead to some level of economies of scale with other vegetable
products, and this has enabled cheaper transport prices for their other vegetable
varieties. Such economic of scale could benefit SADC countries if more
producers became exporters and took advantage of the various ports which have
special capabilities in handling vegetable produce (for example, the proposed
terminal in Maputo).

5.2 Cold chain management is crucial when handling perishable products, from
the initial packing houses to the refrigerated container trucks that transport the
produce to the shipping terminals, through to the storage facilities at these
terminals (and their pre-cooling capability), onto the actual shipping vessels and
their containers, and finally on to the importers and distributors that must clear
the produce and transport it to the markets/retail outlets, etc. For every 10oC
increase above the recommended temperature, the rate of respiration and
ripening of produce can increase twice or even thrice. Related to this are the
increasingly important traceability standards, which require an efficiently
controlled supply chain and internationally accepted business standards.

5.3 Packaging also plays a vital role in ensuring safe and efficient transport of a
product and conforming to handling requirements, uniformity, recyclable
materials specifications, phytosanitary requirements, proper storage needs and
even attractiveness (for marketing purposes).

21
6. Competitiveness of South African cabbage exports

Figure 17 below, shows that South Africa cabbage exports are growing faster
than the world imports into Mauritius, Democratic Republic of Congo and
France. South Africa’s performance in these countries is regarded as gains in the
dynamic market. South Africa cabbage exports to United Kingdom, United Arab
Emirates, and Angola are growing slower than the world imports to these
countries. South Africa performance in these countries is regarded as loss in the
dynamic markets. . South Africa’s cabbage exports are declining faster than the
world imports into Netherlands. South Africa cabbage exports to Germany are
declining while the world imports are growing.

22
Figure 17

Source: ITC Trade Map

23
Figure 18

Source: ITC Trade Map

24
Figure 18 above shows prospective exports markets for cabbage from South
Africa are mainly in United Kingdom, Hong Kong, Democratic Republic of
Congo, Belgium, Netherlands and Czech Republic. Other markets exist in
Switzerland, France, Angola and United Arab Emirates. However if South Africa
is to diversify its cabbage exports, the most lucrative markets exist in Congo and
Mozambique as they have increased their cabbage imports from the world
between 2004 and 2008 period. Cabbage imports from the world to Japan
have declined from 2004– 2008 and as a result those country has
recorded a negative growth rate.

7. CHALLENGES

Cabbage is a difficult crop to grow because it is susceptible to many insects,

diseases and pest. Ensuring a quality pack can be a problem for hand harvesters.
Cabbage has to be harvested only at optimum maturity to meet potential buyer’s
quality standards. The amount of profit made from cabbage crop depends on
how well it meets market specifications. Cabbage crop quality is frequently
measured using physical and sensory criteria. Rising consumer concerns about
food safety have come to impact the assessment of cabbage crop quality.

25
ACKNOWLEDGEMENTS

The following organizations are to be acknowledged

National Department of Agriculture

Directorate: Agricultural Statistics
Private Bag X246
Pretoria
0001
Tel (012) 930 1134
Fax (012) 319 8031

Trade and Industrial Policy Strategies (TIPS)

P.O. Box 11214
Hatfield
0028
Tel (012) 431 7900
Fax (012) 431 7910

Quantec Research
www. [Link]

Market Access Map

[Link]
[Link]

Disclaimer: this document and its contents have been compiled by the
Directorate Marketing of the Department of Agriculture, Forestry and Fisheries
for the purpose of detailing the cabbage industry. Anyone who uses this
information does so at his/her own risk. The views expresses in this document
are those of the Department of Agriculture, Forestry and Fisheries with regard to
agricultural industry, unless otherwise stated. The Department of Agriculture,
Forestry and Fisheries, accepts no liability that can be incurred resulting from the
use of this information

26