Summary
The Citrus Growers Association has once again introduced voluntary restrictions on citrus exports to the EU in order to avert any threat of formal EU import restrictions. While the South African citrus industry is looking forward to new export opportunities as a result of the Brexit process, these opportunities may well be deferred if a two year transition period is agreed. During this period the UK would need to remain subject to EU rules and regulation. The prospect of such a two year transition period however remains clouded by uncertainty, given the contrasting views of the UK government and EU negotiators on the time it will take to agree a long term EU27-UK trade framework.
On the week of the 16th October 2017 the Citrus Growers Association of Southern Africa decided to ‘voluntarily cease exports to the EU as a proactive measure’, in the face of ‘four interceptions of citrus black spot (CBS or Phyllosticta citricarpa) on South African oranges in September 2017’ and 2 in lemons and 1 in oranges in August. The step was taken at the end of the season (when seasonal EU import duties start to be imposed – see table), so as to avert any mandatory EU restrictions (1). This system of pre-emptive suspension of exports has now been in place since 2013, in response to EU moves towards stricter enforcement of CBS controls (3).
Seasonal import duties on South African Citrus
| Code | Product | Seasonal Tariff |
| 0805 10 22 10 | High quality Navel oranges | 13.10 % (16-10-2017 – 30-11-2017) |
| 0805 10 22 90 | Navel oranges (Other) | 13.10 % (16-10-2017 – 30-11-2017) |
| 0805 10 24 10 | High quality white oranges | 13.10 % (16-10-2017 – 30-11-2017) |
| 0805 10 24 90 | White oranges (other) | 13.10 % (16-10-2017 – 30-11-2017) |
| 0805 10 28 | Other | 13.10 % (16-10-2017 – 30-11-2017) |
| 0805 50 10 10 | Fresh Lemons | Minimum import price (16-08-2017 – 31-10-2017) |
| 0805 50 10 90 | Lemons (other | Minimum import price (16-08-2017 – 31-10-2017) |
Source: EC Market Access Data Base
http://ec.europa.eu/taxation_customs/dds2/taric/measures.jsp?Lang=en&Taric=0805&GoodsText=&Domain=TARIC&MeasText=&Offset=25&Area=ZA&ShowMatchingGoods=&ExpandAll=&LangDescr=&callbackuri=CBU-0&SimDate=20171024
The decision of the CGA is put into effect by the South African Department of Agriculture which, following the recommendation of the CGA, will suspend inspections and stop the issuing of phytosanitary certificates for citrus exports to the EU from the affected areas (2).
The measure was announced since, according to the CGA, ‘the risk of the fungal disease increases during the latter part of the season, particularly on Valencias’. The decision does not affect ‘citrus from the CBS-free regions of the Western and Northern Cape nor soft citrus’ (1).
In recent years considerable progress has been made in reducing the incidence of citrus black spot infections in South Africa’s citrus trade with the EU. In 2013 there were 35 interception, 28 in 2014, 15 in 2015 and only 4 in 2016 (1).
Meanwhile the CGA is rolling out a sensitisation programme for the treatment of False Coddling Moth. Presentations covering why the False Codling Moth Risk Management System (FMS) has been introduced, the ‘alternatives should the FMS not work; what needs to be done in order to be compliant’ and the registration, documentation and other administrative requirements, will take place in all citrus growing areas of South Africa, with all producers being advised to attend these presentations so as to ensure compliance with False Coddling Moth control measures (4).
Compliance with the system of False Coddling Moth controls will be compulsory from 1st January 2018 for all exports to the EU. In South Africa after 1st January 2018 non-compliance with False Coddling Moth requirements will lead to exclusion from EU orientated supply chains (4). This is in line with newly introduced EU SPS requirements for the control of False Coddling Moth infestations in consignments destined for the EU market (see companion article epamonitoring.net article ‘EU Farmers Continue Campaign for Stricter EU Citrus Black Spot Controls’, 15 September 2017).
| Comment and Analysis
South African citrus exporters are counting down the clock until the UK’s formal departure from the EU will allow South African exporters to escape strict EU CBS control requirements and CAP related seasonal import levies on citrus exports. The UK’s departure from the EU could potentially see the removal of both strict CBS controls and seasonal levies on exports to the UK; given the UK has no domestic citrus producers to protect. In terms of seasonal levies this will depend on whether post-Brexit the UK remains part of the EU customs union. At the moment it seems likely the UK will leave the EU customs union, and the UK government will then be free to dismantle CAP related import levies. However the UK’s new willingness to consider the establishment of a two year ‘implementation period’ (or ‘transitional arrangement’), in order to avert a ‘cliff edge’ in UK-EU27 trade relations, could see the UK’s departure from the disciplines of EU rules and regulations, linked to the EU customs union and single market, deferred until March 2021. This possibility is something which South African citrus exporters will need to take into account in their forward planning. There is currently a distinct lack of clarity on this issue of the transitional period. In statements in the House of Commons, following the October 2017 EU Council meeting, Prime Minister May appeared to imply an implementation period could only be agreed if there was a consensus on the future framework for long term UK-EU27 trade relations (5). This needs to be seen in the context of press briefings by the EC’s Chief Negotiator on Brexit, Michel Barnier, to the effect that while ‘agreeing transitional arrangements could be possible before March 2019 … a future trade deal would have to be negotiated over several years’ (5). In terms of SPS controls this will be determined by whether UK SPS control systems remains aligned with all aspects of EU SPS control systems in order to facilitate UK agro-food sector trade into EU27 markets. Alternatively the UK could remove SPS control requirements which are not relevant to agricultural production in the UK (e.g. controls on the citrus black spot fungal infections, which pose no threat to human health and which are specific to citrus fruit which is not produced in the UK). However this would be at the cost of stricter SPS controls on affected products in trade across UK-EU27 borders and restrictions on foodstuffs UK tourists can carry when entering EU27 member states. This issue of whether the UK will remained aligned with EU SPS control systems or UK SPS control systems will gradually diverge (starting in those areas where the UK has no domestic agricultural production which could be affected by the controlled plant diseases) is an issue of relevance to all ACP exporters of products with high SPS risk assessments. The UK’s future policy choices around this issue could carry important cost implications for ACP exporters, with the significance of these implications varying considerably across different products and between different ACP countries. This is an issue which will require careful assessment. The issue of the UK’s future relationship with EU systems of SPS controls has not yet been discussed. This is a result of the slow progress of phase 1 Brexit negotiations and the unwillingness of the EU27 to enter into discussions on future trade relations with the UK, until agreement has been reached in principle on how to deal with phase 1 ‘divorce issues’. The aspirations of South African citrus exporters to escape the confines of EU trade restrictions as a result of the Brexit process thus seem likely to remain clouded in uncertainty until at least March 2021. |
Source
(1) Freshplaza.com, ‘SA citrus suspension to safeguard critical EU market’, 24 October 2017
http://www.freshplaza.com/article/183688/SA-citrus-suspension-to-safeguard-critical-EU-market
(2) Freshfruitportal.com, ‘South Africa suspends EU-bound citrus exports’, 24 October 2017
https://www.freshfruitportal.com/news/2017/10/24/south-africa-suspends-eu-bound-citrus-exports
(3) Agritrade, ‘Targeted restrictions placed on South African citrus exports’, 15 November 2013
http://agritrade.cta.int/en/layout/set/print/Agriculture/Commodities/Horticulture/Targeted-restrictions-placed-on-South-African-citrus-exports
(4) CGA, ‘From the desk of the CEO’, 20 October 2017
http://www.cga.co.za/page.aspx?ID=4571
(5) The Guardian ‘No Brexit transition period without final EU trade deal, Theresa May tells MPs’, 23 October 2017
https://www.theguardian.com/politics/2017/oct/23/brexit-transition-period-final-eu-trade-deal-theresa-may