1. Strategic Positioning of SA Agriculture in Changing Global Markets
NAMC Annual Report Presentation to the Portfolio Committee on Agriculture and Land Affairs by
TR Ramabulana
Strategic Positioning of SA Agriculture in Changing Global Markets

2. Content of Presentation
Business Plan 2005/06
Annual Report 2005/06
New developments 2006/07
Markets and Economic Research Centre
Enterprise Development
Strategic Positioning of SA Agriculture in Changing Global Markets

3. NAMC Strategic Programmes
Council Activities
Outreach/ Marketing Schemes
Statutory Measures
Research (Section 7 Investigation)
Food Price Monitoring
Budget
Strategic Positioning of SA Agriculture in Changing Global Markets

4. Output & Service Delivery Trends of Council
Sub-programme Outputs
Outputs
Indicators
Performance
Council Meetings
Agenda items
Expected number
Actual numbers
Council sittings 11 7
Submissions to the Minister 26 31
Ministerial enquiries 4
Executive Committee meetings 2
Management Committee meetings 46 44
Strategic Positioning of SA Agriculture in Changing Global Markets

5. Corporate Governance Structures
Audit Committee
Human resources Committee
Risk Management Committee
Executive Committee
Management Committee
Strategic Positioning of SA Agriculture in Changing Global Markets

6. Outreach/Marketing Schemes
Target: 38 workshops reaching 2500 farmers
Achieved: 21 workshop reaching 1736 farmers
Reasons: Changed strategy since outreach didn’t provide key support such as markets access, capacity building, finance, etc
New strategy focused on business linkages using Agribusiness and Technical Assistance Fund
Example of farmers assisted on database attached
Strategic Positioning of SA Agriculture in Changing Global Markets

7. Enterprise Development
Main ED deliverables are development of a database of black owned enterprises, the implementation of a business linkages model & use of Agribusiness Technical Assistance Fund .
The assistance provided to emerging enterprises could be group into the following categories:
Training courses: Making Markets Matters, International Negotiation Skills and Business Management skills
Production of Promotional material: Business Cards, Information Booklets and Pull-ups stands
Business plans and Feasibility studies
Attendance of Major Conferences: All Fresh Conference, Market Access Conference & Southern Hemisphere Fresh Produce Conference
International Marketing Visits: Major supermarkets in Netherlands and United Kingdom Royal Agricultural Show
Strategic Positioning of SA Agriculture in Changing Global Markets

8. Enterprise Development
Marketing Schemes- Government Supported Industry Driven.
Detailed black farmers consultation
Farmers business support models
Business linkages model
Franchise model
Co-operative model
Management and growth of Database of emerging enterprises
Agribusiness Technical Assistance Fund
Linkages with major buyers
Export promotion
Distribution of Market information to emerging enterprises
Re-alignment of trusts to empowerment objectives
Strategic Positioning of SA Agriculture in Changing Global Markets

9. Strategic Positioning of SA Agriculture in Changing Global Markets
Statutory Measures
11 industries collected statutory levies
R130 million was collected – this represents only 0.7% of production value at first point of sale
Approximately 43% of levies were collected to finance research, 15% for information, 14% for transformation and 13% for export promotion
In August 2005, the NAMC’s guideline of levies for transformation purposes changed from 10% to 20% of levies collected
In the past 5 years, the market share of emerging farmers in the 10 industries (production) increased from 1.2% to 4.1%
Cotton industry the highest – approximately 20% of production is coming from emerging farmers
Strategic Positioning of SA Agriculture in Changing Global Markets

10. Statutory Measures
Total value of production R’000
Levies collected R’000
Levies available for PDI R’000
Levies collection success rate
Citrus
2 600
15.0
1.3
94%
Cotton
240
4.8
0.6
100%
Deciduous Fruit
- Pome fruit
- Stone
- Table grapes
2 124
737
1 796
14.5
6.1
11.2
1.9
0.3
0.7
96%
98%
95%
Dried fruit
136
1.5
0.2
97%
Potato
2 529
14.3
1.4
99%
Sorghum
200
1.2
0.1
89%
Wine
- Wintech (grapes)
- WOSA
- SAWIS
2 791
12.7
16.9
6.0
4.1
3.4
0.9
Dairy
3 812
6.3
28%
Winter cereals
2 847
19.6
90%
Total
19 812
130.1
18.1
Strategic Positioning of SA Agriculture in Changing Global Markets

11. Strategic Positioning of SA Agriculture in Changing Global Markets
Estimated funding for Research in Autralia(2003)
Industry
Industry contribution
Gov. contribution
Pork
A$ 3,990,000
A$ 3, 340,000
Wool
A$ 60, 220,000
A$ 16, 170,000
Dairy
A$ 13, 450,000
A$ 14, 050,000
Fisheries
A$ 5, 120,000
A$ 17, 390,000
Forest & wood products
A$ 3, 690,000
A$ 2, 950,000
Grains
A$ 65, 050,000
A$ 39, 150,000
Grapes and wines
A$ 7, 850,000
A$ 7, 050,000
Horticulture
A$ 31, 050,000
A$ 29, 620,000
Livestock
A$ 26, 650,000
Sugar
A$ 5, 240,000
A$ 4, 310,000
Tobacco
A$ 0, 210,000
Cotton
A$ 7, 140,000
A$ 7, 280,000
Strategic Positioning of SA Agriculture in Changing Global Markets

12. Statutory Measures Introduced
Sub-Programme
Measure
Livestock
New dairy statutory measure (Levy, record & returns, registration)
New red meat statutory measure (Levy, record & returns, registration)
Horticulture
Appointment of Inspectors in Potato Industry
Amendment of the notice for statutory measure in the potato industry
Four year wine statutory measure
Field Crops
Appointment of Ministerial trustees on the Lucerne, Sorghum & oil and protein seed development trust
Extension of the maize marketing scheme
New four year Winter Cereal statutory measure
Continuation of measures (registration, record and returns) in cotton
Amendments to statutory measures (registration, record and returns) maize, winter cereals, sorghum and oilseed
New statutory levy on sorghum
Strategic Positioning of SA Agriculture in Changing Global Markets

13. CONTROL BOARDS STILL IN EXISTENCE AS AT 31 MARCH 2006
NAME OF ENTITY
NUMBER OF EXTENSIONS GRANTED
REASON FOR
CONTINUED EXISTENCE
Maize Board 11
Outstanding issues including court cases relating to the collection of outstanding levies
Strategic Positioning of SA Agriculture in Changing Global Markets

14. Section Seven Investigations
Fresh Produce section 7 investigation
Game (wildlife ranching) section 7 investigation
Solutions for sustainable export in the citrus industry
Sorghum industry study
Purpose:
Advise the Minister on any statutory intervention need
Provide industry with intelligence necessary to increase competitiveness of the sector
Strategic Positioning of SA Agriculture in Changing Global Markets

15. Markets & Economic Research Centre (MERC)
The NAMC has established the MERC
Research Areas:
Trade intelligence
Competitiveness
Supply chains analysis
Statistics
Rural Livelihoods
Products:
Markets and Economic Research Fund
Section 7 Committees
Academic support programmes
Research library
Strategic Positioning of SA Agriculture in Changing Global Markets

16. Examples of Research Projects
Possibilities for fruit exports to Russia
Study to assess the impact of RSA class 1 fruit exports to African and Indian Ocean Island countries
ASGI-SA Sub-sector studies (Regulatory constraints & challenges, possible government intervention to remove bottlenecks)
SA-New Zealand comparative study on effects of deregulation
Study on taxes on the agricultural sector
Supply and demand models for potato industry
Rural and Urban Food price monitoring
Input cost monitoring
Input of deregulation on agricultural efficiency and productivity
Strategic Positioning of SA Agriculture in Changing Global Markets

17. Strategic Positioning of SA Agriculture in Changing Global Markets
Marketing and Trade
Trade Intelligence
3rd Generation issues
Tariffs
Industry growth perspective
Marketing of Brand SA Agriculture
Strategic Positioning of SA Agriculture in Changing Global Markets

18. Strategic Positioning of SA Agriculture in Changing Global Markets
Trade Intelligence
Monitor traditional markets and inform export industry
Provide intelligence about new markets
Use Agriculture Trade Attaches
Lobby for increase in number of Agric. Trade Attaches
Improve relations between SA agric export industries and Trade Attaches
Generate intelligence on:
Products
Markets and Constraints
Competitors
Price
Strategic Positioning of SA Agriculture in Changing Global Markets

19. Strategic Positioning of SA Agriculture in Changing Global Markets
Trade Attaches
South Africa has Agricultural Trade Attaches in the following countries:
Brussels- Mr. Winston Makabanyane
China- Mr. Mono Mashaba
USA- Dr. Simphiwe Mkhize
Italy- Ms. Margaret Mogapi
Switzerland- Ms. Gerda van Dyk
Strategic Positioning of SA Agriculture in Changing Global Markets

20. Strategic Positioning of SA Agriculture in Changing Global Markets
Trade Intelligence
The NAMC undertook numerous studies aimed at assisting the fresh produce export industry to monitor developments in traditional markets as well as explore emerging markets. Studies undertaken include amongst other the following:
Possibilities for fruit exports to Russia
A study to assess the impact of RSA Class 1 exports to African and Indian Ocean island countries.
Foreign market development for potato industry
Strategic Positioning of SA Agriculture in Changing Global Markets

21. Strategic Positioning of SA Agriculture in Changing Global Markets
Tariff
Forge close working relationship with International Trade Administration Commission (ITAC)
Objective:
Assist industries with the necessary research that will help build a good case for any tariff application
Undertake research that will also help incorporate development issues (rural development, employment, AgriBEE, job creation) into any tariff investigation process.
Strategic Positioning of SA Agriculture in Changing Global Markets

22. Strategic Positioning of SA Agriculture in Changing Global Markets
Food Price Monitoring
Targets achieved:
Produced an annual publication known as Food Cost Review
Distributed as widely as possible
Produced quarterly food price trends press release
Monitor 75 different products
Monitor both urban and rural food prices (2006)
Strategic Positioning of SA Agriculture in Changing Global Markets

23. UTILIZATION OF 2005/06 NAMC BUDGET
INCOME R14,042,000
Made up of:
Transfer from DoA R12,163,000
Other income (Interest earned and roll-over) R 1,879,000
Strategic Positioning of SA Agriculture in Changing Global Markets

24. Strategic Positioning of SA Agriculture in Changing Global Markets
ACTUAL EXPENDITURE R14,109,000
Made up of:
Personnel expenditure R 7,393,000
Administration R 3,203,000
Professional services R 1,542,000
Surplus R 1,971,000
Strategic Positioning of SA Agriculture in Changing Global Markets

25. Strategic Positioning of SA Agriculture in Changing Global Markets
Emphasis of Matter
Without qualifying the audit opinion, the AG drew attention to the following:
Implementation of supply chain management
Performance information
Value added tax
Irregular expenditure
Strategic Positioning of SA Agriculture in Changing Global Markets

26. Staff Representation as at 31 March 2006
Job Category
Council
Secretariat
Historical background
Advantaged
Disadvantaged
Total
Part-time 5 10
Section Head 2 3
Economist
Financial staff -
Secretaries
Admin staff 1
Support 8 11 29
Strategic Positioning of SA Agriculture in Changing Global Markets

27. Limitations and Future
Limited execution powers: to be addressed through the review of the MAPA
Limited funding: R16 million/ year.
Other countries, e.g. AbareEconomis in Australia A$125 million/ year; ERS in USA US$65/year.
Future focus areas:
Economic and market research
Trade intelligence
Export promotion
Marketing schemes
Statutory measures
Strategic Positioning of SA Agriculture in Changing Global Markets