COVID-19 Market Report - South and East Africa

Border Restrictions

From March 16, South Africa has closed up to 35 of its 53 land borders, as well as two seaports. Furthermore, from March 18, foreign nationals from high-risk countries (China, Iran, Italy, Germany, South Korea, United Kingdom, and the United States) will not be allowed to enter the country. All commercial borders (road and rail networks) are still operational with some limits in transporting as the country undergoes a 21-day lockdown.

Kenya has suspended all international flights from March 25 except cargo flights.

Uganda has suspended all passenger flights and closed its land borders and seaports. Exceptions are made to cargo flights and cargo cars with less than three people.

Ghana has banned anyone, with exceptions to nationals and residents, from entering the country if they have been in a country with +200 cases of the coronavirus within the past 14 days. Since March 22, all borders have been closed and quarantine has been issued. Cargo will still be allowed to enter in and out of the country.

Logistics

South Africa has prohibited crew changes in all of its ports. Container availability is short in South Africa, which could potentially decrease fruit exports. Due to the shortage, freight costs are likely to increase as well.South Africa will also give higher priority for transportation of certain goods in ports such as citrus products, compared to goods which have longer shelf-life such as nuts and dried fruit. In addition, pre-clearance inspection from the Ministry of Agriculture, Forestry and Fisheries (MAFF) for exports to Japan will not be required. Exports to the US are also undergoing a similar route, where inspectors are only checking certain inspection points.

Kenya’s ports have set restrictions for ships coming from Asia. Kenya has also been seeing a poor performance at the port of Mombasa due to fewer arrivals of ships as well as cancellations from importing countries.

Uganda largely relies on air freight and many of its fruits and vegetables are destined for the Middle East. But due to the pandemic, cargo flights have been minimized from four per week to three. Additionally, Uganda has also been relying a lot on passenger planes for exports. This has been made even worse as most of the airlines have been reducing their flights out of the country.

Regulations

In South Africa, while new hygienic measures have been issued at harvesting and packing facilities, the agricultural sector is still set to continue operations. The agricultural sector will also be exempt from the protocol that limits gatherings of 100 people or more. In addition, the South African government decided to extend the fishing season for the West Coast Rock Lobster as well as other fish due to the heavy losses in the fishing industry.

In Kenya, tea auctions have been postponed as the government has banned large gatherings. Kenya, as well as Tanzania, has created strict measures for sellers not to raise prices of commodities and will be heavily taxed if caught doing so.

Influences on Exports & Imports

Avocados in Kenya are seeing low demand for exports due to restrictions in importing countries such as China, Spain, and Germany. This will cause huge decreases in demand for commercial varieties such as Hass and Fuerte, and these will be hard to sell in the domestic market.

South African citrus producers are looking for a new market as the outbreak has left China, its biggest export market, inaccessible.

Cashew prices in Ghana have decreased from USD 123.14 to USD 61.65-USD 70.36. This is as demand for cashews in Ghana, Côte d'Ivoire, Nigeria, and Benin have plummeted as their main export destination is Vietnam, for which the products are then imported to China. And since the pandemic, China has ceased exports of cashews from Vietnam.

The tea market in Kenya has been negatively impacted as buyers in major importing countries such as China, Pakistan, and Iran have halted trade after the outbreak.

West Coast Rock Lobster is seeing a reduction in global demand, causing a decline in the export price. This drop in demand is attributed to trade limitations for China, a top importer of crayfish.

Uganda’s coffee and cocoa bean industry are also seeing low demand from Europe as consumption has declined.

Domestic Supply & Demand

South Africa is set to see a reduction in domestic supplies of rice, palm oil, and wheat, as it imports large quantities of these products from China and Italy. However, there will be an excess of supplies for fruits and vegetables due to limitations in exporting to key markets such as China, thus causing the prices to decrease.

Similarly, Kenya’s domestic demand for tea and sugar has increased as consumers are stockpiling essential goods. Manufacturers in Kenya are supplying more tea to the domestic market as well.

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