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EC’s green house of opportunity lures horticulture giants
Posted on: Thursday, 10 March 2005. Article source: Eastern Cape Business News
The Eastern Cape has the potential to become the location of choice for green house horticulture companies, says Eastern Cape Development Corporation investment promotion head Pierre Leppan.
Leppan, who recently returned from Germany, says the Eastern Cape may be the new site for a German company who wishes to relocate its 15 ha operation from elsewhere in Africa. The project is estimated to be worth R50 million and could generate 500 jobs.
Leppan explains that the province offers several advantages to companies involved with cuttings and rooted young plants exports that include the popular Aloe Vera and several other new varieties.
“The province’s position is further enhanced because South African Plant Breeders (SAPB), which is located near Chintsa, breeds new plant varieties for European companies. It also performs the commercial testing on their behalf. Consequently, it has played a strong role in growing the industry in the province,” explains Leppan.
He says that several European companies have indicated a keen interest to ECDC who believes that at least five companies will establish themselves in the Eastern Cape in the next five years.
“The province has a unique opportunity to harness the natural, political and social benefits of the Eastern Cape for cutting and young plant production,” adds Leppan who sketches potential of the sector: East London’s green house industry for tomatoes and peppers has grown from almost zero ha to an estimated 70 ha in only six years.
“The city’s industry generates R100 million per annum and has created over 1 000 jobs. Ornamental plants, as they are known in the industry, can at least double the profits of a tomato operation. One Danish grower who farms 10 ha is estimated to have a turnover of more than the total income of pineapple farmers in our province What’s more, 100 per cent of crops can be exported and have a high value per unit volume.
“Job creation numbers are also impressive. Some horticulture operations use 70 people per ha. Over a 70 ha area, this translates into employment for 5 000 people.”
Leppan says ECDC is targeting those crops that have longer growing periods and high light intensity requirements to produce good quality cuttings. They must also ship safely – they should not dry out, get heat or cold damaged during shipping.
Chlorophytum, Aloe vera and a wild strain of Kalanchoe are some of the crops currently under production in the region surrounding East London.
According to Leppan, the results are impressive: "The cuttings are smaller, more compact, have a thicker leaf and are faster rooting."
Since first launching the initiative to increase interest among young plant producers, a Danish firm Gasa Young Plants, has assisted a local young plant company in getting off the ground in the Eastern Cape. They also sent the region's first exports to Europe and the response has been very good.
Based on a very large existing vegetable green house industry, there are definite opportunities for partnership or contract growing arrangements. Local tomato green house farmers are keen to diversify from vegetable production to the lucrative young plant production. They are, however, carefully considering the pros and cons of this new opportunity.
“The province, and East London and the surrounding areas, in particular, offer a stable and mild climate due to the proximity to the Indian Ocean. Seasons are also the opposite of Europe, which extends the availability of various crops.
“The province also offers attractive staffing and labor options. Management staff from Europe can be kept to a minimum because all levels of management staff with farming backgrounds are readily available in the province,” ends Leppan.
Other advantages include low electricity costs, easy access to international airports in Johannesburg or Cape Town which provide a less than 24-hour turnaround for products ordered from South Africa and shipped to, say, the Netherlands, and low property prices.
One of the province’s keenest African competitors for the global investment in this sector is Ethopia and Kenya which has an established horticultural sector.
Caption: EC plants being tested in Denmark. Linda Noack of SAPB Cefane, ECDC’s Mlamli Nodada and representatives of Fools for Flowers.
Leppan, who recently returned from Germany, says the Eastern Cape may be the new site for a German company who wishes to relocate its 15 ha operation from elsewhere in Africa. The project is estimated to be worth R50 million and could generate 500 jobs.
Leppan explains that the province offers several advantages to companies involved with cuttings and rooted young plants exports that include the popular Aloe Vera and several other new varieties.
“The province’s position is further enhanced because South African Plant Breeders (SAPB), which is located near Chintsa, breeds new plant varieties for European companies. It also performs the commercial testing on their behalf. Consequently, it has played a strong role in growing the industry in the province,” explains Leppan.
He says that several European companies have indicated a keen interest to ECDC who believes that at least five companies will establish themselves in the Eastern Cape in the next five years.
“The province has a unique opportunity to harness the natural, political and social benefits of the Eastern Cape for cutting and young plant production,” adds Leppan who sketches potential of the sector: East London’s green house industry for tomatoes and peppers has grown from almost zero ha to an estimated 70 ha in only six years.
“The city’s industry generates R100 million per annum and has created over 1 000 jobs. Ornamental plants, as they are known in the industry, can at least double the profits of a tomato operation. One Danish grower who farms 10 ha is estimated to have a turnover of more than the total income of pineapple farmers in our province What’s more, 100 per cent of crops can be exported and have a high value per unit volume.
“Job creation numbers are also impressive. Some horticulture operations use 70 people per ha. Over a 70 ha area, this translates into employment for 5 000 people.”
Leppan says ECDC is targeting those crops that have longer growing periods and high light intensity requirements to produce good quality cuttings. They must also ship safely – they should not dry out, get heat or cold damaged during shipping.
Chlorophytum, Aloe vera and a wild strain of Kalanchoe are some of the crops currently under production in the region surrounding East London.
According to Leppan, the results are impressive: "The cuttings are smaller, more compact, have a thicker leaf and are faster rooting."
Since first launching the initiative to increase interest among young plant producers, a Danish firm Gasa Young Plants, has assisted a local young plant company in getting off the ground in the Eastern Cape. They also sent the region's first exports to Europe and the response has been very good.
Based on a very large existing vegetable green house industry, there are definite opportunities for partnership or contract growing arrangements. Local tomato green house farmers are keen to diversify from vegetable production to the lucrative young plant production. They are, however, carefully considering the pros and cons of this new opportunity.
“The province, and East London and the surrounding areas, in particular, offer a stable and mild climate due to the proximity to the Indian Ocean. Seasons are also the opposite of Europe, which extends the availability of various crops.
“The province also offers attractive staffing and labor options. Management staff from Europe can be kept to a minimum because all levels of management staff with farming backgrounds are readily available in the province,” ends Leppan.
Other advantages include low electricity costs, easy access to international airports in Johannesburg or Cape Town which provide a less than 24-hour turnaround for products ordered from South Africa and shipped to, say, the Netherlands, and low property prices.
One of the province’s keenest African competitors for the global investment in this sector is Ethopia and Kenya which has an established horticultural sector.
Caption: EC plants being tested in Denmark. Linda Noack of SAPB Cefane, ECDC’s Mlamli Nodada and representatives of Fools for Flowers.
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