Trade Focus

Allan Majuru

AS 2021 kicks off with anticipation for increased exports, particularly in line with the African Continental Free Trade Area (AfCFTA) whose implementation commenced on January 1, the success of local businesses is going to depend on the ability to tap into low hanging fruits.

One of Zimbabwe’s sectors with a comparative advantage to unlock lucrative opportunities for exporters is agriculture, particularly horticulture.

In most societies in Zimbabwe, discussions on commercial crops are often limited to commodities such as maize, pearl millet, soyabean, wheat, tobacco as well as animal husbandry.

However, there are other crops whose potential is still to be fully harnessed.

One of these crops is paprika, which belongs to the Capsicum annuum species and has a variety of uses, including in food processing, flavouring and the pharmaceutical industry. Paprika is used as a condiment that is exported in its dried or ground form.

It is made from Capsicum annuum varietals, which include chilli peppers, but the peppers used for paprika tend to be milder and have thinner flesh.

The crop is mostly used in food colouring, meat canning, sauces, confectionery and as a base in seasoning applications.

There has been considerable growth in the use of paprika in cosmetics, perfumery, beverages, and pharmaceuticals.

As products that are deemed to have healthy benefits are growing in demand across the world, paprika is touted as having anti-inflammatory, anti-depression, and antioxidant properties. These diversified applications of paprika reveal promising opportunities and markets across several sectors.

Currently, global demand for natural food colourants is growing, especially in wealthier countries, thus positioning paprika as a lucrative crop for farmers to grow in Zimbabwe.

The most popular paprika varieties grown by most farmers in Zimbabwe are Papriqueen or Papriking, a standard commercial seed variety for sweet paprika that is not only highly productive, but also developed for the drying and processing market.

Paprika can be grown in most parts of the country but the crop performs better in warmer areas with well drained soils.

Industry insight and market potential

According to Trade Map, the international market for paprika and related products has been on an upward trend as indicated by world imports, which have been growing by an average seven percent from 2015 to 2019.

Total world trade of paprika and related products in 2019 were around US$743 million, up from US$703 million in 2018 and US$560 million in 2015.

This is indicative of the growth in global trade of the product and the vast potential production of paprika offers.

For Zimbabwe, the country has been recording insignificant exports of paprika over the past few years, notwithstanding the potential in regional and international markets. Zimbabwe paprika farmers in 2019 were not able to produce enough volumes to meet regional and international demand, according to a paper published by TradeComm in 2019.

To help improve production in the sector, ZimTrade — the national trade development and promotion organisation — has been working with the Nyanga Paprika Exporters Association to resuscitate production in the Nyamaropa and surrounding areas. There are plans to roll-out capacity development programmes to cover current and potential paprika farmers across all provinces.

Going forward, local farmers need to increase production of quality paprika and target already performing and emerging markets.

North America is the one of the biggest consumers of global paprika exports with a market size of US$221 million as at 2019, followed by Europe (excluding UK) with an approximate market size of US$196 million.

Asia is an attractive market whose size is approximately US$179 million.

If local exporters ride on the AfCFTA — which commenced trading this year — the current market size is around US$39 million, with South Africa ranking as the top African importer of paprika.

Already, South Africa is Zimbabwe’s biggest trading partner, which will make it easy for local farmers to tap into this market.

The coming into action in of the continental-wide trade agreement raises an opportunity for Zimbabwean producers to target new markets such as Libya and Algeria, which are ranked second and third respectively in importing paprika in Africa.

Egypt and Tunisia are the other potentially lucrative markets for paprika in Africa.

As local farmers target these markets, they need to come up with measures to address some barriers to entry as there is high competition in markets.

According to a report by Grand View Research, forecasting the paprika market size for the period 2019-2025, the global international market has several industry analysis issues to consider such as high entry barriers where huge global corporates are likely to offer intense competition by continuously improving and innovating on paprika products.

To mitigate this and as an entry strategy, Zimbabwean producers can seek partnerships and collaborations with key existing global players in this industry to tap into the growing market for paprika products.

In addition, value-addition will also ensure local exporters earn more in export markets.

Some of the high value-added products include paprika powder and paprika extracts.

For those that will be exporting value-added paprika powder and other commodities that can be sold directly to the consumer, critical control is required to ensure the bacterial loads are eliminated.

Key considerations for paprika farmers and exporters

1. Sanitary and

Phytosanitary issues

The possible sanitary and phytosanitary risks associated with paprika production emanate from poor post-harvest and storage procedures including factors such as improper drying of agricultural products that allow the formation of toxins — aflatoxins, moulds, and yeasts in paprika.

The other risks emanate from use of post-harvest treatments that are not recommended by the importing country, for example in the case of paprika, irradiation can be an issue.

The excessive use of pesticides above maximum residue levels in paprika will make it difficult to land the product in markets like Europe, Asia and Middle East.

It is not acceptable to use unauthorised pesticides, additives, and substances in the production of the crop.

Farmers are encouraged not to use any purple or red label chemicals in the production of the crop as this will leave behind high chemical residues. High levels of filth are also unacceptable in the export of paprika.

This high level of filth usually emanates as a result of batch samples containing insect parts, dirt and animal and bird droppings, as a direct result of no or poor product quality assurance, grading and sorting. As such, one or all these filth levels can be a problem in dried paprika.

Product adulteration

The alteration of chemical composition of the product is not accepted in most export markets.

In many cases, adulteration is deliberate and in the case of paprika; adulteration for profit has been the case in paprika powder to increase the colour brightness and intensity using artificial dyes such as Sudan red.

Documentation, labelling
and packaging

Farmers are encouraged to use proper documentation as stipulated by the World Trade Organisation.

Improper documentation involves among other things, false health and or phytosanitary certificates, which when detected might lead to blacklisting of the exporter or the entire industry in countries that have strict protocols. When labelling, the correct labels should be visible to allow the identification of ingredients used in production.

The labels should state the expired or sell by dates, undeclared presence of genetically modified organisms and/or irradiated products. On labelling in most countries, allergens must be highlighted in the list of ingredients, especially for value-added garlic products.

Exporters must take note of the language preferred by the importing country, such as Portuguese for Mozambique and Angola and French for Francophone countries.

Regarding packaging, that material used should protect the taste, flavour, colour and other characteristics of the product. The packaging should protect the product form bacteriological and other contamination and not pass out any odour, taste, colour and other foreign characteristics.

Inappropriate packing, particularly the sacking used in baling the dried pods could harbour food safety hazards and phytosanitary risks. There is need for farmers to use packaging material that is free from contaminants to avoid product rejection upon reaching the market destination.

Exporters looking for convenient packaging and local suppliers can make use of the ZimPackaging Portal (zimpackaging.co.zw ) developed last year to strengthen synergies between manufacturers of packaging materials and consumers.

Allan Majuru is ZimTrade chief executive.