FRUIT AND VEGETABLES
Nothing exemplifies more the globalisation of the commodities
markets than the trade in fruit and vegetables. Supermarkets
in Germany, Canada, UK and most other developed countries
are full of exotic fruit and vegetables, which can only
be grown in tropical countries. Developments in transport
and food production and preservation mean that crops
normally grown in the summer in temperate climates can
be supplied in winter by growers in hotter climates.
Nothing could be more typical of the northern cuisine
than Brussels sprouts - yet these can now be supplied
to Europe from Kenya.
This change has been brought about by the increase in
wealth of people in the industrialised world relative
to those in tropical countries. Expenditure on food
now represents only a small fraction of the disposable
income of many Northern families. Fruit and vegetable
production is highly labour intensive and the comparatively
low incomes of people in developing countries ensure
that these countries can supply competitively.
International transport costs are also fairly cheap.
It costs more per pound to send a lorry full of apples
from Taunton to London (150 miles) than it does to send
apples by sea from Mombassa to London (7000 miles).
In spite of these advantages, tropical farmers still
face formidable obstacles if they wish to export fruit
and vegetables to Northern markets. Most developed countries
impose import duty on products which are also grown
by their own farmers. The EU maintains duty rates of
between 10 and 20 per cent on many of these goods even
for GSP (General System of Preference) countries. Most
products are free of import duty for ACP (Africa, Caribbean
and Pacific) countries, however.
The most difficult barrier for exporters to these countries
is quality. Consumers in developed countries are very
worried about becoming ill by eating impure food. It
is true that most vegetables are cooked and most fruit
is peeled, but this only goes part way to satisfying
Northern customers. All imports have to comply with
strict import regulations. Any substandard product must
be destroyed on entry.
Importers and customers want to see a fresh, clean,
uniform, blemish-free product packed firmly in a good-quality
carton properly printed with its grower's name, mark
and address and its net weight.
Most fruit and vegetables need to be transported in
temperature-controlled containers in order to avoid
deterioration. Different products often need to be transported
at different temperatures. The following examples demonstrate
Aubergines should be transported and stores at 8 to
10 degrees C, asparagus at 2 degrees C, okra at 8 to
10 degrees C and green beans at 4.4 to 7.2 degrees C.
Only well-organised growers can hope to meet all these
specifications, but even if they can, they still cannot
be sure of finding a good buyer or receiving a good
price. Importers in developed countries range in size
from very small to very large. They act as importers
and sales agents for the tropical exporter.
In Europe, the smaller importers are wholesalers selling
to smaller retailers. They can only tell the supplier
the price that can be paid to the supplier after they
have sold. This price changes every day, according to
how many buyers or sellers are trying to do business
on a reasonably accurate idea of what price to expect,
Larger importers supply the big chains of supermarkets
and only buy in substantial quantities. They will often
pay a fixed price, but only after building up a good
working relationship with the supplier.
Both types of importer act as a sales agent working
on an exclusive basis and expect to take about a 7 per
cent commission on the sales they make. In return for
this commission, they would arrange for importation
and customs clearance, arrange internal transport and
warehousing, find a suitable buyer, obtain payment and
pass payment on to the supplier.
Tropical suppliers wishing to sell directly to developed
countries will need to supply the importer with a carton
or two of typical samples together with a schedule of
planned deliveries. The importing company will then
decide whether it is able to act for the supplier.
The names of importers can generally be obtained from
the institute or association representing the industry
in that country. In Britain, these interest are represented
by the Fruit importers Association, Room 408/9, market
Towers, New Covent Garden, London SW8 5NQ. Details of
EU regulations for imports of different fruit and vegetables
can be obtained from the international trade centre,
Palais des Nations, Geneva 10, Switzerland.
>Market information >
Tropical commodities and their
markets > Chapter 1.6