From Failure to Success in South African Agricultural Transformation TR Ramabulana CEO: NAMC Tzaneen, Limpopo Province 17 May 2016

Failure Yes you are right There are islands of success; especially in horticulture But they are few in a sea of poor performance or outright failure

Criteria for evaluating transformation has to be consistent with Inclusive Growth Inclusive growth is the guiding principle of the National Development Plan and requires Employment generation, as wage or self-employment on farms Creation of livelihoods Contribution to agricultural growth

Outline Conclusions Corporate governance and alignment Partnerships Transformation and empowerment projects NAMC supported projects

Objectives and Mandate Mandate and Objective Advisory body that advices the Minister of DAFF and DAG on all matters relating to marketing of agricultural products. Increase market access for all participants. Promotion of efficiency of marketing of agricultural products. Optimise export earnings from agricultural products. Enhance the viability of the agricultural sector. NAMC Council Members Mr. Andre Young- Deputy Chairperson & Acting Chairperson Ms Mina Gill- Council Member Mrs JM v/d Merwe- Council Member Dr. John Purchase- Council Member Mr. Andries Cronje- Council Member Dr Litha Magingxa- Council Member Mr. Augustinus Hendricks- Council Member Ms Thami Zimu – Council Member Divisions Market and Economic Research Centre Agricultural Trusts Agribusiness Development Statutory Measures Corporate Services 2018/12/01

Partnerships NAMC Industry bodies (administrators of statutory levies) Trusts 12 Industry Trusts Current asset value amounts to a total of R2 424 million Industry bodies (administrators of statutory levies) 18 industry bodies collected a total amount of R421 million in 2014

Origin of Statutory Funds The MAP Act , provides the establishment of statutory measure in order to directly and substantially advance one or more of the objectives of the MAP Act, namely: to increase market access for all market participants, to promote the efficiency of the marketing of agricultural products, to enhance the viability of the agricultural sector, and to optimise export earnings from agricultural products. One of the conditions for the approval of statutory levies is: 70% for functions such as research, information & generic promotions, Max. 10% - spent on administration, and 20% - spent on transformation – the development of emerging agribusinesses in line with the AGRIBEE balance scorecard

Functions financed through Statutory Levies 2014 Amount spent R Percentage of total levy expenditure Administration 23 382 174 5,55 Transformation 97 857 656 23,21 Research 129 488 083 30,72 Local promotions 41 781 397 9,91 Export Promotions 61 125 753 14,50 Information 42 289 121 10,03 Quality control 18 024 659 4,28 Plant improvement 4 732 794 1,12 Production development 2 885 571 0,68 TOTAL 421 567 208 100.00 Levy income 2009 = R263 mil

Current Asset value (R) Trust Name (12 in total) Administrator Current Asset value (R) Citrus Industry Trust Dr Konani Liphadzi 16 611 994 Deciduous Fruit Industry Development Trust Mr Anton Rabe 15 480 860 Maize Trust Mr Leon du Plessis 1 086 368 772 Meat Industry Trust Ms Alet du Plessis 41 942 462 Mohair Trust Mr Deon Saayman 280 627 631 National Lucerne Trust Mr Derrick Engelbrecht 2 698 107 Oil and Protein Seeds Development Trust Mr Gerhard Keun 326 883 435 Potato Industry Development Trust Ms Elsabe Els 14 682 897 Sorghum Trust 26 097 897 Winter Cereal Trust Dr Simon Letsoalo 114 099 225 Wool Trust Mr Andre van der Venter 488 230 467 SA Wine Industry Trust Mr Charles Erasmus 10 690 634

Transformation and equity

Pessimists see a difficulty in every opportunity and optimists see an opportunity in every difficulty - Winston Churchill

Examples of transformation projects funded by statutory levies Citrus industry Project title Objectives and outcome Number of beneficiaries Amount (R) Human Capacity Development: Citrus Academy To address: low skills levels, employment equity, scarce and critical skills, land transition and quality skills delivery Bursary Fund – 64 students (R1 441 533) Holiday work programme – 9 students Industry exposure programme – 31 students Internships – 10 students 1 925 000 Dairy industry “Promoting of sustainable commercialization of existing black dairy farmers” project To promote the development of existing black milk producers to become sustainable, commercial milk producers Optimalize the level of milk production through the supply of cows Optimalize the level of milk production through infrastructural and other support services Up to 8 farmers in the Free State were assisted with electrification of farms, supplied with heifers, veterinary services and with market access. Through this project the farmers have created approximately 60 jobs. 8 4 900 00 Potatoes Enterprise Development Programme To assist in setting up, supporting and growing viable new black owned potato producing enterprises. To develop an economic programme that is aimed at sustainable potato production by small holder farmers in order to utilise available land and assist to the maximum benefit of an integrated production system To develop small holder farmers to grow and produce commercially in a sustainable way To establish sustainable fully fledged commercial farmers 17 KwaZulu-Natal: 9 Eastern Cape: 6 Free State: 2 Limpopo: 1 3 067 871

Cultivars Replacement In 2009, the deciduous fruit industry started a project to establish 1 000 ha of trees, including new cultivars, for black producers. By 2013, the industry already succeeded to establish 400 ha. The Western Cape DoA assisted the industry with soil preparation and irrigation. In the table grape industry, 8 farmers were assisted to establish new cultivars on approximate 70 ha. The aim is to establish approximately 40 ha per.

Lucerne Production Background Trust Intervention Progress The Lucerne Trust is providing seed to black farmers (25 kg per ha) Target area is Taung irrigation scheme where black farmers producing lucerne under irrigation (pivot system) Trust Intervention Progress The Trust has already assisted 40 farmers on a total area of 400 ha (10 ha per farmer) An additional 20 farmers on a further 200 hectares will be assisted in 2016 Farmers also being assisted with harvesting and the marketing of their lucerne

Witzenberg empowerment model 45 empowerment projects in 1 Municipality; Over 4000 ha of new orchards into production; Projects throughout the value chain from primary production to marketing; Export oriented industries; All projects linked to an export value chain.

Agricultural Development Schemes The schemes are designed and implemented to uplift the black producers in the agricultural sector and to encourage their integration into the commercial mainstream. This programme is driven to address food security and domestic market access. Designs are and guided by developmental impact and feasibility Work in collaboration with different stakeholders: Industries – for technical support Provincial and national government departments ( DAFF, DRDLR) – farmer supports including extension services Financiers – funding of projects Government agencies (e.g. PPECB) – compliance and certification Buyers – market access

Agricultural Development Schemes The following projects will continue in the 2016/2017 financial year under irrigation Product Province No of farmers / projects Size Market Vineyard Northern Cape 9 sub-projects Target 500 ha of vines Distell, OWK NRMDP Operational in KZN (5), EC (8) 2016 new sites KZN – 5 additional CFPs NW - 2 MP - 1 LP - 1 keep over 15 000 per 90 days cycle Formal (auctions & abattoirs) and informal markets Carrots Gauteng 2 farms 30 ha for the pilot Mc Cain

Continues…. The following projects will continue in the 2016/2017 financial year under irrigation Product Province No of farmers / projects Size Market Dry beans Limpopo 5 Farmers 80 ha Tiger brands Sugar beans 1 cooperative with 5 members 10 ha pilot NTK Vegetables 65 farmers 100 ha fresh produce markets (JHB & Rhodes)

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