Research to drive rooibos exports

FMCG SUPPLIER NEWS

Fin24 - Jul 13th 2012, 08:10

Cape Town - A R1.2m international grant fund on rooibos export competitiveness secured by the South African Rooibos Council is aimed to drive exports of the indigenous herbal tea. 

This is for the second phase of a technical assistance project which the Netherlands government is funding to improve the volume and value of rooibos exports.

The International Trade Centre (ITC), a joint agency of the World Trade Organisation and the United Nations, is managing the project in collaboration with the Netherlands’ Centre for the Promotion of Imports from Developing Countries as part of the Partnership Agreement Netherlands Trust Fund (NTF II).

The initial six-month phase involved an analysis of the German rooibos market and the potential for direct exports of value-added rooibos product in markets where tea is currently re-exported from Germany.

Germany is by some margin the world’s largest rooibos importer as many of the largest European tea merchants are based in Hamburg.

It accounts for some 2 500 tonnes of the approximately 6 000 tonnes of rooibos exported annually. Other major markets are the Netherlands at 1 085 tonnes and the UK at 860 tonnes.

As a result of the first study, the SA Rooibos Council’s marketing campaign in Germany was extended to Austria and Switzerland, both significant herbal tea markets served by the large German distributors.

The latest tranche of funding is being used to conduct an in-depth analysis of the way production data is collected, analysed and disseminated.

This will ensure better production forecasts and supply capacity and help to limit excessive price fluctuations, all of which are concerns for importers.

The Rooibos Council is also finalising an export development plan and has identified Dubai and Taiwan as two potential new markets.

Both are established herbal tea markets and importers have already expressed interest in the South African tea.

Robert Skidmore, head of the ITC’s Sector Competitiveness Section, said the second phase of the project will begin to deliver real benefits for the industry.

“We first needed to understand the export markets and what the opportunities were. Now we can help the industry to better meet market requirements and develop new markets.”

Donneé MacDougall, the South African Rooibos Council’s marketing director, said that capitalising on export potential will be an important next step for the industry.

“We’ve seen good domestic growth and if we can increase exports, particularly of value-added products rather than just bulk tea, it could provide a significant boost which would benefit the entire sector, from farmers to manufacturers.”