Mahlogedi Victor Thindisa Manager: Agribusiness Support Gauteng Department of Agriculture and Rural Development Provincial Agro-processing Support 1

OUTLINE What is agro-processing? Agricultural entrepreneur Challenges faced by SMME agro processors Post harvest losses Importance of post harvest technology Conclusion and wayforward 2

What is agro processing? 3 Agro-processing entails changing the form of a product. Agro-processing is the conversion of raw agricultural products into different physical state to satisfy market requirements Value addition implies adding value to a product after which a buyer is willing to pay a price for the product at more than the cost of inputs used in the process. Value can be added to products without changing physical form (cleaning, grading or labeling)

Simple form of adding value 4

Simple form of processing 5

Agricultural Entrepreneur 6 Entrepreneur is a person that can bring an IDEA into PROFITABLE reality. Without creativity your business will be stagnant as competition around you progress. Identify niche markets suitable to your business. Business is a sustainable profitable endeavor?

WHAT IS MARKETING? Marketing involves finding out what the customers want and supplying it to them at a profit (FAO, 2005) Interconnected Activities During Marketing Planning production Growing and harvesting Harvesting, field handling, Sorting, grading, packing Storage, transport, retail market Consumer preference / acceptance

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Challenges faced by SMME agro processors Limited production capacity (land, finance, skills, markets etc) Farms are located faraway from the markets (high transaction cost) Challenges faced in satisfying the quality requirements of the consumers (market requirements) Do not have access for new technology (skills and finance) Difficulty in obtaining new information Weak negotiations, lack of confidence with traders and companies 9

Post harvest losses Harvesting at an incorrect stage of produce maturity Excessive exposure to rain or extreme temperatures Physical damage Rough handling Chemical contamination Erroneous transport & spillage during transportation Improper packaging Bio-deterioration (damage by rodents, birds, pests & fungi) Prolonged storage 10

Efficiency vs. Effectiveness vs. Risk 11

Importance of post harvest technology 12

Importance of post harvest technology 13 Extend shelf and storage life of products Maintaining quality, nutritional properties of products Cold chain management Packaging technology to increase profit margins Overcome seasonality and perish-ability constrains Expand marketing opportunities

Post harvest technology stimulates the following Prevents postharvest losses Improves nutrition and adds value to agricultural products thereby opening new marketing opportunities Generating new jobs while stimulating growth of other related economic sectors Increase net profit margins 14

Focal points of Gauteng Agro processing Strategy Support packages to stimulate entrepreneurship by SMME agro-processors; Contribute towards investments in economic infrastructure (Roads, rail, water etc); Facilitate value chain linkages with relevant markets; Facilitate technical and managerial training of SMME agro-processors 15

Conclusion and way forward Gauteng Employment, Growth and Development Strategy (2009) and Gauteng Agricultural Development Strategy (2010) identified agro-processing as priority area for job creation and increase of profit margins to farmers. Coordination and integration of activities between province and municipality to maximize impact. Training and educating farmers on benefits of agro-processing. Provide financial assistance to farmers regarding agro-processing initiatives (Cost/Benefit analysis). Cooperative development 16

Coordination and integration of 3 spheres of GVT 17

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END Lekker BOER Questions and clarity? Thank you!!!!! 19

WHO is a monkey now? 20