 to mind is that all our fruit is for export, and us South Africans get the B or C grade of fruits. So I'm glad that we have quite an expert like yourself, just to maybe teach us about trade and marketing around fruits and get an in-depth understanding of what HortGrow does. So maybe that's just my first question for this evening. If you could just maybe explain HortGrow as an organization, you know, what is it about and what is it, what is its objective? Yeah, HortGrow is the growers association for for deciduous fruit growers. We are funded by growers through a statutory levy that's in place for four years and after every four years we do a vote again and if there's a majority vote amongst the deciduous fruit growers in the levees and state it again for further four years. So so governed by growers funded by growers and basically two main functions that we look after. The one side is HortGrow Science which focuses on research and development and then tech transfer which of course has a lot of legs underneath that and then the other part is the trade in the markets that that I'm responsible for. So looking after market access, market development, product standards, regulations, basically logistics these days as well with the issues we have in the port. So pretty much anything and everything that's got to do with markets. Just to add, so we don't trade ourselves. So our main goal is to try and create an enabling environment for our growers, exporters and packers to flourish. Right, so we'll get more into detail on that just in a sec but for people who just don't understand the difference between an ordinary fruit and a deciduous fruit. Just what are deciduous fruits and I don't know if I'm pronouncing it correctly. Your pronunciation is correct. So deciduous fruit, the technical interpretation of term means fruit that leaves or trees that loses their leaves in winter compared to citrus trees which keeps their leaves throughout the year. So that's the broad term deciduous and within our definition of deciduous it refers to foam fruit which is apples and pears. In the UK they call it top fruit and then the other big group or smaller group but the other grouping is stone fruit which is apricots, peaches, nectarines, plums and then cherries. So the ones with a rock art center or the stone. So you mentioned that HoardGrow came about within four years ago or maybe you were in the organization four years ago but it's a member-based organization. What was the landscape like before HoardGrow? So farmers that are farming apples, pears you know all the crops that you mentioned just now did they have to find their own markets and is that what brought about the formation of HoardGrow? HoardGrow has actually been around since effectively 97-98 so the four-year cycle is basically we tell ourselves we've got a four-year lifespan and if we don't do our job then the growers won't wait again for us and they'll be able to stay in place so that's where the four years come in. But prior to 97 our industry as many others were regulated so there was only one export in the country all growers had to export through that one exporter. Then in 97 the industry deregulated and you could basically pack and export through anybody you want to. So HoardGrow in essence came about just after deregulation and grew a lot in between and evolved as the times and the the conditions evolved to where we are now. All right so just also to understand the structure like you mentioned it's a growing led organization so the farmers pay a certain fee yearly and they employ experts like yourselves you know that would work in the office so to say to to work on behalf of the farmers produce while the farmers at the end of the day are still at their farms etc and then you just you know working for the farmers providing the markets any I think documentation that's required for trade logistics like you said and then yes that is a four-year cycle is that what you say? Yes so yeah the four-year cycle that we vote on or the growers vote on so it's interesting our industry is very integrated so you will find that growers or groups of growers own a pack house like the old cooperative type of setup then this pack house will also do the marketing for them locally as well as abroad so where we come in is at a higher level where these groups of growers issues that they can't resolve themselves and for instance research that will benefit the whole industry we do on behalf of all the growers and government relations talk market access it's a level that a grower or a couple of growers can't do on their own when you want to get access for a new product to a country like China for instance. Okay okay great so let's talk about your specific portfolio you said you're involved in the trade and marketing side what does that entail? Well the one party's market development we don't like to use the word promotions because that's got a negative connotation at grower level and a cheap price but we promote South Africa as a brand and South Africa as a supplier of fruits worldwide so we've got market development campaigns running in the UK in Germany in the Middle East Dubai in China we launched one this year in India as well and also locally and in the overseas campaigns it's about distinguishing South Africa as the preferred supplier basically from the southern hemisphere we supply mainly to the northern hemisphere when it's opposite seasons so our main competition is from Chile, Argentina, Brazil, New Zealand and Australia so internationally it's creating that platform and that brand that preferred preference for South African fruits as the preferred supplier and then on the local market it's just about promoting consumption of our fruits and stone fruits specifically. Yeah and without talking to negative around the growers that you represent is it true that you know with very niche crops like deciduous fruits that you've mentioned stone fruits is it true that you know farmers would put first preference to selling the A grade to international markets and then the local South Africans will consume the B grade? It's not entirely true we produce too much fruit for the local market so we have to export otherwise the local market will be completely oversupplied and to be brutally honest your best prices is achieved on the export market but the fruit that you consume on the local market comes from exactly the same tree it's treated exactly the same as the export fruit and in 99% of the the instances it's about the color of the fruits or the size of the fruit or if it's got a little rub mark where it's rubbed against a branch or another fruit so that's basically what the difference is between export fruit and local fruit in many instances the problems comes in after the fruit has been picked and packed and delivered and now it is treated from the packers to the final consumer. Once fruit is picked it has to be cooled and kept in the cold chain up to basically you and I eat it otherwise from the it just degenerates in terms of quality so our what's correct with bug bay is how fruit is actually treated by the sellers on the local market and thrown around and not kept cool and so forth. Right at what point Jacques does a farmer then decide that it's time to export right because I could be a new fruit farmer maybe I'm farming pears and I've invested in a huge pear farm wherever in South Africa and at what point do I decide that a certain percentage of my production will go to local market and a certain percentage would go to export but I want to focus more on the export so at what point does a farmer decide it's time to export and when do they need to have that decision made so is it two years in advance is it 12 months in advance meaning signing those contracts and agreements with your export market so that you know because I can imagine with with with stone fruits and deciduous fruits it takes quite some time does a farmer need to make that decision to say with this percentage of crops that I'm going to harvest at the farm X percentage is going to go to export market and how does one need to prepare for that. I'm going to distinguish a bit I'm going to leave out the the dried fruits and the the fruit that is meant for for processing and canning because most of those growers they focus on that and that's their that's their focus but if you talk for the fresh market your question is when when you start making those decisions that's probably five years before you even plant orchid I mean it takes you if you decide today I want to plant apple or pear trees you have to put your order in for trees today it will take you probably two years at least to get those trees and then you plant them then it takes another three four years at least until they start bearing any fruit and then probably another three four five years before it's in full production so it's it's a long-term investment it's a huge investment to to farm with fruit it's in excess of 400,000 grand per hectare to establish an apple orchid for instance at this stage just one one hectare so then you have to keep that tree alive you have to feed it you have to irrigate it have to prune it have to train it and then you start getting your small little harvest in year three four maybe so I'm just trying to get to to the extent of your capital as well as your operating capital needed before you start even thinking about breaking even so a tree is in the ground for minimum 25-30 years so it's a long-term planning that you have to do and different markets have different preferences for fruit for instance golden delicious which is one of our biggest apple cultivars we mainly export to Africa it's a green green apple if you want to export to say Taiwan and it's mainly Fuji which is a redder type apple and coming back to the difference between local and export fruit the east if you generalize they want the red fruits and South Africans are happy to have fruit that just tastes good but doesn't have to be glossy red or if you take pink lady which has got a pink blush on the side the markets overseas want that pink blush but exactly the same apple from the same tree which doesn't have the blush doesn't get nearly as close to that price as the pink one wow wow and and with with with the how we with how we compared against the global markets Jacques is I just want to find out maybe one of the top fruits that are in demand specifically from South Africa to the global audience and what makes us so unique when it comes to growing the specific fruits that horde grow looks after maybe let's start with that point it's our unique climate actually our climate for growing fruit in and also South Africa is a water scarce country so our fruits we believe and it has been proven as a better eating quality than many of the other fruits producing in other countries with abundance of water and and so forth but getting back to the different markets it differs substantially between fruit types as well if you take it back one step for instance we export between 45 to 50 percent of our total apple production and apricots we only export 4 percent and plums we export 75 percent and if you start talking markets all over the world 70 well let's say 70 percent of our stone fruit gets exported to the UK and Europe if you take apples almost 30 percent goes to Africa via ship Western Africa Nigeria Eastern Africa Kenya on that side and then the other 30 percent goes to the east whereas we almost send no stone fruit to the east at this stage so each week kind unique in terms of preferences in terms of consumers markets and space yeah you mentioned about the high costs in farming the different fruits rather i mean 400 000 grand minimum per hectare you know and then you obviously need to look at operating costs etc etc before you break even and you also mentioned the various different fruit specs and varieties that different countries would like to buy from South Africa um do you ever have you found yourself as horde grow as an association in a position where there's a shortage of the right type of fruits based on the global markets you know because maybe let's say um you know certain farmers have stopped farming or do you find that you know um an app a pink apple farmer has now converted into a pear orchard um but do you ever find yourself in a case or have you had instances where there's been a shortage of a specific fruits spec or variety simply because there was not enough production um not really um i mean it's applying demand so so the less fruit we have um technically the higher the price should be um but we operate in a global market so if South Africa's got a drought or issues with production then the buyers will go to chile or argentina or brazil or wherever they can get the fruit so it's a it's a very fluid integrated global supply and demand system um some years our fruit are a bit smaller so then you struggle to supply the markets you prefer bigger fruit um other years you've got some sunburn if there's heat waves and then you have issues perfect and you struggle to supply certain markets um but yeah it's a very fluid and integrated system yeah yeah so again with your portfolio it's all about trade uh trade and markets as well um and you know when you talk about export markets everybody talks about exporting in a positive way to say yes export definitely because you get the highest price you know you get your crop to be eaten by someone in london or in china or whatever the case is you know which could bring a very good story for your farm but what are some of the downsides of exporting that people are not really aware of is a long-term payments the documentation i mean we've heard of the african free trade agreement has that really opened up the industry more so maybe just give us some uh some idea in terms of the the cons or the downsides of exporting and and what what people don't usually think of it is a it's a iris business um as i said earlier it's it's where you earn the most money so you want to pack as many fruits for the export market as as possible um the downsides is all the accreditations and all the the minimum specs and use of chemicals and all of that that you have to adhere to it's i mean it's like a a book of rules and regulations that you have to adhere to in order to export and then you have to get the right fruit type and spec and cultivar supply those markets and when you get back to the payments um the growers are always the exposed ones um it's not like an exporter or a retailer in the UK buys the fruit and takes it from you from your farm or your pack house you ship it to them they sell it and if there's any quality issues all those claims come back comes back to you so um and it takes you these days 16 18 days per vessel or with shipping to to get the fruit from Cape Town say to to Europe um and there's a lot of risks involved in that in getting the fruit in the correct quality to those markets if there's anything wrong declined um and then those claims will come back to you so you find instances the growers actually have to pay in money to get the fruits destroyed on that side or sold at a lower lower price than production costs although you've covered the shipping the packing the production all of that yeah and where does horde grow come into this pot because you mentioned that you don't necessarily trade the fruits you know but it's more of legislation documentation lies with government stakeholders etc and in these cases like where does horde grow come in and can you influence the decisions with the global markets by any chance um not at the commercial level that's a discussion between the the customer on that side and the producer and the exporter on on this side um but on our higher level we come come in with a minimum specifications um so there's minimum export specifications for color for size for the pressure of the fruit for the sugar content of the fruits um all of that that's where we we come in but that's that's a minimum you you don't aim for the minimum you aim for for the for the higher so you can earn better money established in 97 how big is your membership base right now um you know and uh we we we we focus a lot on farmers are some nurseries uh and uh yeah are some nurseries and maybe some some marketers part of horde grow because you want to obviously add some diversity into the members that you represent yeah we we are grower focused so um all growers of stone and palm fruit are members of of horde grow um we've got about 630 apple and pear growers and about 860 stone fruit growers um but because we are also integrated um although the the grower is our focus and basically the the guy who funds us um we we look after them but also work closely with the back houses and also work closely with the exporters um because it's a integrated chain that that we operate in so all of that we do um in order for the grower to do the best as possible on on the farm and also just to understand the structure of horde grow uh Jacques is so for example if I had to decide to invest in a pear farm tomorrow do I have to be part of horde grow because you know when I heard you talk uh it's that yes this is a very niche fruit or niche commodity and um as a new farmer do I have to be part of horde grow so that I don't flood the market with with a lot of fruits um so yeah can one just operate on their on their own or is it very beneficial to be part of horde grow so that you guys can keep control of the amount of fruit that is produced in South Africa and just to get stats like this so that we can compare where or yeah where we stand with the global markets and to also ensure that you know new farmers just don't flood the market with the specific fruits and maybe are buying the wrong varieties how does it work yeah so so so we don't control at all um you can plant whatever you want to as many as you want to we don't control the plantings or the volumes at all we we supply information and we try and inform and and and educate people in the right way but because it's a it's a statutory measure that's in place um as I said for the four years if there's a majority yes vote then it's gazetted by the minister of agriculture and on every carton that's exported or sold there's a x amount of cents per kilo that that comes to us so we've got boards on the bone fruit side and on the stone fruit side that's made up of growers so so they govern our functions and what we do with their money in in essence but it's not commercially involved no controls that was that was 97 pre 97 oh okay okay because I thought maybe you know it would be beneficial um to just keep control or um keep informed of what new growers are doing on the ground and also not to just flood the market so that's quite interesting to hear what we try and do is we we do a tree census every year so we know which trees which cultivars were planted in which areas and then we came we've got a model that predicts how much plums will be produced in the next five years or 10 years so we can we can guide the growers and tell them look at the stats that's those are the facts we foresee and hypothetically an oversupply of plums in the next three years so be careful of what you plant think about which market you want to service and just be aware of what's going on yeah yeah and another reason why i was asking this is also maybe just to have control of the different maybe disease outbreaks that could happen because this is a huge investment so i'm sure you wouldn't want any just brand new farmer maybe getting seeds from who knows where uh trees sorry trees from who knows where um or you know unknown nurseries just sitting up shop and then all of a sudden there's an outbreak of some funny virus growing around and you know damaging quite a lot of investments that farmers have put on the ground no 100 correct i mean it's a as i said a 25 year plus investment yes and if you look at the amount of money that you invest over those 25 years um there's no don't take shortcuts when it comes to buying trees buy the proper trees buy the right cultivar that's suited to your area otherwise if you make that mistake in year one and after three four five years you find out i made a mistake we've lost those four years and you have to start over again and you pretty much it's we've done the calculation i think it's it's over a million that you lose if you plant at the incorrect cultivar or the wrong tree quality at the start and you have to to do it over again wow joc this sounds so fascinating and i wish i had like an hour of your time because um you know there's just so much uh technicalities and specific things that go into the trade and marketing of uh the different fruits that horde grow represents but just to sum up our conversations evening which has been so fantastic i just want to find out what are some of the milestones that horde grow has been able to achieve uh maybe since uh uh it's it's establishment or maybe since you've been uh part of the organization so what are some of the things that we could celebrate about you know any information on growers um anything that horde grow maybe has been able to break uh into the market maybe you know um get on new uh what's us create new untapped territories that um you know some countries that never bought from us before and now you know you've been able to unlock those relationships so maybe just tell us some of the success stories or milestones that horde grow is most importantly proud of since maybe it's inception or since you have been part of the organization i think in in in general um getting getting those two industries organized and structured and um well equipped with information and and excellent research for infrastructure and and networks that that's been built up with the various universities locally as well as abroad and and the government of course and the ARC um in terms of market access um one of the big ones but that's already five six years ago was getting access to china for apples but that process took us 12 years um we applied in 2003 for all stone fruit and all palm fruits the process to kick it off to get access so apples was passed in 2015 and i really hope that we can get access for pears before the end of the of the year but if you look look globally um protectionism and it was just exactly exaggerated by by covid um protection globally um countries looking after their own interests after their own growers um so market access retention has has become more difficult um spain wants us out as long as possible with our stone fruit because we compete at the beginning or at the end of their season on their local market and this is a global phenomenon so retention of markets um gaining of new market access and then optimizing the the markets that we do have access to is basically the grow strategy that we are working with that on the market access side right thank you so much joc for your time this evening it was very very engaging and very very informative um and i think i learned a few things you know stone fruit deciduous fruit um the trade thereof um and it's definitely created a lot more anxiety uh to me around exporting you know i'm glad i'm a vegetable farmer because then i don't have to deal with so many years of uncertainty you know even if you've had contracts in place but anything could happen you know um look at what covid has taught us now you're saying that countries have are trying to kick um certain international markets out and focus on their own farmers and i can just imagine when you have to relay that information back to the growers to say maybe we can't go into spain anymore because you know uh they're deciding to subsidize and support their own farmers so what do we do at that time and especially once you've made so much investment and being a farmer in south africa i know that farming doesn't come cheap these days so yeah it's been such a uh an educational and informative conversation and hope we could have you on the podcast once again it's a pleasure you're welcome thank you surround yourself with it with the right people and right advice and then you can get to the export market absolutely i definitely agree to that thank you so much zhark that was zhark Dugriag who's the general manager of trade and markets at horde grow which is an association led by growers deciduous and stone fruit growers um and he told us about you know the structure um how his portfolio works touched on a bit of the export markets the trade the various fruits um that are traded in various countries we spoke about the different specs the varieties and some of the technicalities and challenges around trading and exporting fruits if you missed this conversation this evening you could catch us directly onto our youtube channel private property under the farming podcast playlist and you could hear everything that zhark had to say um if you are a fruit farmer please contact horde grow if you uh if that's if you haven't been a member as yet but if you are a fruit farmer looking to get more information please reach out to zhark contact horde grow and i'm sure they'll be able to give you sufficient information regarding the trees of different varieties what you should plant in your area it sounds like a definite long term investment with huge rewards but thankfully we have organizations like horde grow to assist the grower at the end of the day in a lot of the things that um you know are based outside the farm and has to do a lot on the trading how you position yourself how who to market and how you market etc thank you so much for joining the farming podcast this evening catch me once again on Thursday 8 p.m and i will see you then take care