further push up production. Clingstone crops for canning in excess of 120,000 tons can reasonably be expected 

 within a short time. 



PROCESSING 



Structure 



In 1969, 14 canning companies with 18 plants, registered with the Canning Apricot-Peach Board and 

 processed apricots, peaches, and pears in the Western and Eastern Cape Province. These plants are scattered 

 throughout the region but in or close to the important producing districts. All of the companies except one have 

 only a single canning plant in the producing area. The one exception is the cooperative, which operates five 

 canneries. 



The majority of the companies are classified as "private" firms. The remainder, excluding the cooperative, 

 are "public" companies or subsidiaries of public firms. The primary distinction between a private and public firm is 

 that a private firm restricts the right to transfer its shares, and it is unlawful for the firm to invite the public to 

 subscribe to its shares or debentures. 



Three firms dominate the industry. They are the one cooperative, a subsidiary of a U.S.-based international 

 food processor, and a cannery owned by a public company. Combined, they process roughly 70 percent of the cling 

 peaches delivered to canners and also the bulk of the apricots and pears. Most of the other canneries are quite small. 

 A number of years ago, the cooperative, which is the largest firm in the industry, handled over half of the three 

 fruits. But as production increased, its volume failed to gain accordingly, and its industry share is now less than 40 

 percent. 



The cooperative has a history of relying heavily on borrowed funds to finance its operations. Cooperatives, 

 and also independent growers, in South Africa are eligible to obtain short-, intermediate-, and long-term credit from 

 a Land Bank at interest rates below commercial rates. The interest rate on short-term credit loans has been around 7 

 percent in recent years, about 1 percent below the general interest rate. 



The number of canning plants has been fairly stable during the last decade. The capacity of these plants, 

 which were established when the industry relied almost solely on the Kakamas peach, was designed to accommodate 

 a large volume of fruit during a short span of time. Although the length of the season has been increased through 

 new canning varieties, considerable excess capacity remains during much of the season. This is evidenced by the 

 demand from canners for additional fruit in recent years. It is believed that the volume of fruit processed could be 

 expanded substantially without a large increase in capital outlays. 



Over 95 percent of the fruit and vegetable canners in South Africa are members of the South African Fruit 

 and Vegetable Canners Association. This organization performs such functions as representing canners on the various 

 control boards, negotiating sugar rebates, and collecting statistical information. 



Plant equipment and material 



The canneries are well maintained but generally are not equipped with modern processing machinery to the 

 same extent as are California's plants. Substantially more hand work is used in such operations as sorting, grading, 

 and packing fruit. Canners, however, are continuously adding new equipment and gradually phasing out some hand 

 labor. 



Although automatic pitters and peelers are used extensively, canners also maintain at least one line of 

 hand-fed pitters. Occasionally hand pitting is used, but mainly for utilizing more fully the time of labor pools. Some 

 canners have cup-up, face-down shakers to improve quality control; they also do some color sorting to maintain 

 consistency in the color of peaches in each can. Color coding of cans and sorting by hand to separate grades is 

 evident in the less modem canneries, as is hand carrying of fruit for trimming. Also used to some extent are vat-type 

 cookers into which are dipped cans of fruit in large bins. Automatic palletization is not in widespread use. 



Almost all of the raw materials used by canners are of South African origin. Only one processor 

 manufacturers his own cans. Others obtain cans from one firm specializing in their manufacture. 



Rebates on sugar used by canners in exported products are negotiated annually between the sugar industry 

 and the Canners Association to reduce the sugar prices to a more competitive basis with other producing countries. 



10 



