Building on the positive gains of transformation

South Africa has made progress in transforming the agricultural sector, but concerted effort is needed to make real change.

By Malapane Tha M aga , agricultural economist at

the African Farmers Association of South Africa

Since the dawn of democracy, South Africa has made concerted efforts to transform the agricultural sector through the introduction of myriad agricultural economic policy reforms. However, far more can be achieved if the South African agricultural sector can build on the positive gains made in the past 29 years. There are also serious lessons to be learned, too.

The sector continues to reflect the duality of successful white commercial farmers, who contribute more than 90 per cent of agricultural output, and struggling emerging black farmers, who contribute less than 10 per cent. The picture becomes even worse when you move along the value chain, which tends to be concentrated among a few large firms. The oligopolistic characteristic of agricultural value chains tends to be the same as you move from one commodity to another, and comparable conclusions can be made about the financial sector. This leads to market failures that must be corrected through various government interventions.

SeedS that never grow

If there is one area that South African agricultural sector has excelled in, sadly, it is spending towards the development of new policy programmes without actually implementing anything. Programmes are changed with every shift in political administration, before they can even reach maturity.

For example, in 2015, to enable a transparent land reform programme, then-Minister of Land Reform and Rural

Development Gugile Nkwinti introduced the District Land Reform Committees in the 44 districts of the country. Committee members were trained to identify farms suitable for acquisition by government, with target of acquiring 20 per cent of strategic agricultural farming land in the country by 2030.

They were tasked with identifying and interviewing potential candidates for farm allocation, advising the minister on the strategic support needs of identified farms and candidates, and resolving land rights conflicts. All these gains were put on hold by Nkwinti’s successor, Maite Nkoana-Mashabane. Since then, the land reform programme has been handled internally and less progress has been made towards the 20 per cent target.

the Power to chooSe

On another front, government continues to support different segments of emerging farmers through the various programmes. These forms of support are highly appreciated, as they are needed to help grow this category of farmers towards commercialisation. However, there seems to be a lack of strategy to accommodate more farmers who are yet to be supported towards commercialisation, especially those who have acquired their own land privately.

Complaints from farmers regarding farmer support are mainly due the reach, delayed delivery of inputs, quality of procured inputs and inflated input prices due to inefficient supply chain procurement mechanisms. There is, however, a successful system used by the Free State Department of Agriculture that empowers farmers by giving them the power to choose their own suppliers, allowing them to source quotations from three different suppliers. This is worth replicating throughout the country, as it empowers farmers and ensures that there is value for money spent.

There are also impactful contributions made through the Agricultural Industry Trusts whereby 20 per cent of the bodies’ budget is allocated towards transformation work. There were 11 Agricultural Industry Trusts worth R2.4-billion as of 2021. In 2020, about R76.6-million was channelled through transformation-related projects to empower mainly black farmers.

What is positive about initiatives driven by Agricultural Industry Trusts is that they put more emphasis on the quality of farmer training rather than chasing numbers. It would be worthwhile to have the trusts follow a public-private-partnership approach and work hand-in-hand with government on initiatives related to the Agricultural and Agro-processing Master Plan (AAMP), to avoid duplication of responsibilities, while also learning from each other’s experiences and leveraging resources. These efforts could be easily managed through the commodity round tables as proposed in the AAMP.

Lastly, it would be worthwhile appreciating that if you cannot measure, you cannot manage. There is a serious need to publish regularly the number of black farmers supported by both the development finance institutions and commercial banks annually, to track their contribution towards inclusive growth as articulated in the Economic Reconstruction and Recovery Plan. Institutions like Statistics South Africa and the National Agricultural Marketing Council need to work together to publish transformation data regularly and enable government to track agricultural transformation in South Africa.