The Johannesburg Fresh Produce Market is to undertake significant changes that will allow it to compete on an equal footing with private distributors.

A STATE-OF-THE-ART storage and selling facility that will allow the Johannesburg Fresh Produce Market (JFPM) to compete directly with private fresh produce distributors will soon be established.

Called the Premium Hall and to be housed in the current Vegetable Hall, it will improve the market's infrastructure significantly, says the market's chief executive, Kgosientso Ramokgopa.

"The Premium Hall will address quality of fresh produce through cold chain management. Essentially, the establishment of the Premium Hall - at a cost of R250-million - is intended to position the JFPM as a leading role player in the South African fresh produce industry," he says.

Kgosientso Ramokgopa chief executive of the Johannesburg Fresh Produce Market

Work on the revamping of the hall, which is need of serious refurbishment, will begin in May 2009.

Ramokgopa explains that the entire storage area for fresh produce will be temperature controlled and segmented, to allow every product to be stored at its optimal storage temperature.

All produce on sale at the Premium Hall will be of the same - or even better quality - as produce sold by companies such as Woolworths, Pick n Pay and Freshmark. The produce will also go through a stringent cold chain management system.

"Produce will enter the Premium Hall directly from refrigerated trucks, through docking stations, with the assistance of dock levellers to prevent an interruption of the cold chain. Produce coming from smaller and emerging farmers who do not have cooling facilities will go into rapid cooling units first to bring the temperatures as quickly as possible to the right levels. This will enable smaller farmers to compete on an equal footing with the large producers."

Benefits
There will be significant benefits for the fresh produce market industry:

• Buyers will receive better value for their money;
• The risk of food scares regarding quality will be significantly reduced;
• Small and large producers will compete on a level playing field; and
• Small and large retailers will compete on a more level playing field.

At present, the hall is 30 000m² in size. Its roof will be lifted to make space for the latest technology of storing pallets five levels high on shelving, primarily to accommodate economic temperature control. The shelving will increase the hall size to 38 000m².

The latest technology will also be used in a selling area, which will be separate from the storage area and will be protected through access control to ensure effective security. Only samples of the produce will be on display in the selling area, in a fully enclosed, climate controlled atmosphere.

Offices will occupy 5 000m² of the Premium Hall, built above the selling area.

There are three trading halls at the JFPM at present - the Vegetable Hall, the Fruit Hall, and the Potato and Onion Hall. After the refurbishment of the Vegetable Hall, the two other halls will be rented out to operations that support the Premium Hall trading floor.

Setting up the Premium Hall does not mean that the market's big buyers, like informal traders, will be sidelined, Ramokgopa stresses.

"The Premium Hall is designed to attract a significant amount of new business to the JFPM. The informal traders will still be able to buy produce from us at the same price as the large retailers. The Premium Hall is for everyone who needs quality fresh produce."

Push factors
A number of "push factors" compelled the market to come up with a plan for a Premium Hall. Since the JFPM was set up in 1974, there has been no fundamental change in its logistical operations and no upgrades of its physical infrastructure, he says.

"Also, the deregulation of fresh produce distribution post-1994 saw farmers getting leeway to sell directly to large retailers. The emergence of food safety standards also saw retailers divorcing themselves from the fresh produce market, leading to losses."

Yet another factor was the emergence of a group of producers and business people that made a request to set up an alternative market in Joburg to sell quality fresh produce to a niched market like the big retailers.

This request was turned down by the City as the Constitution permits only local government to set up fresh produce markets within the boundaries of the City of Johannesburg, according to Ramokgopa.

"Dialogue was initiated between the alternative market group and the JFPM management with a view to engineering a solution that would advance the business interests of both parties."

These talks, however, faltered as the alternative market group was determined to use a piece of ground it had bought in Nasrec, southwest Joburg, to set up an alternative market.

Following its decision not to allow this alternative market group to set up a fresh produce market, the City asked the JFPM to draw up a plan to address the concerns raised by the group, Ramokgopa says. "Thus the idea to establish the Premium Hall."

There are plans to position the JFPM as a one-stop food hub in the City, according to Ramokgopa.

"The Fruit and the Potato and Onion halls fall within these plans. There are options to set up value-adding activities like sorting and packing operations, retail group depots and possibly a meat and/or fish market in this area."

The 20ha piece of land behind the market is set to be developed to cater for a range of businesses that support the core business of the JFPM. "This could include corporate retail groups, processors of fresh produce, exporters, wholesale distributors, staging facilities for farmers and other businesses."

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Related links:

• The Johannesburg Fresh Produce Market