The future of and unity within the agricultural industry, as well as worries concerning food security were hot topics at the AgriBEE Showcasing event at the Cape Town International Convention Centre. Glenneis Erasmus reports.
Motsepe Matlala, President of Nafu (National Agricultural Farmers Union), said that anyone who thinks that agricultural conditions are favourable must have their head read. Matlala was speaking on behalf of himself and not as a representative of in response to claims by Ernst Janovsky, chief in charge of Absa Agri Business, that there was no better time to enter the agricultural industry than now. Janovsky, at the AgriBEE Showcasing event, said the increased demand for fuel bodes well for agriculture as it will render the production of biofuel more feasible once fuel prices exceed US to US per barrel. He predicted continued growth for coarse grain and sugar prices, with vegetable and horticulture products remaining fairly stable, and a possible decline in animal feed prices due to a spillover of biofuel byproducts. He predicted that farm profitability as well as farm debt-to-turnover ratios would continue to improve despite price volatility, and estimated that farm property values would double over the next five years. As such he views agriculture as one of the new growth areas in the South African economy.
Matlala, however, did not attend the meeting so he couldn’t comment on Janovsky’s presentation, but was willing to say that things are definitely not looking bright for farmers regardless of whether they are black or white. “Based on government’s development strategy, we are one of the only sectors that are not performing well,” Matlala said. He pointed out that there are many factors straining the agricultural environment. Agriculture has a negative image rendering it extremely unattractive for investment. In addition to this, farmers are struggling to remain productive due to rising input costs. “Consumers look at maize prices and think farmers are making a huge profit. But they don’t know it costs around R5 000 to establish 1ha of wheat. If you don’t have money to plant, then you won’t be able to take advantage of the good market prices,” he said, adding that processors take a large cut of farming profits. Matlala also spoke out against farm taxes.
“Farmers are subjected to rising labour costs each consecutive year – we are responsible for our workers’ wellbeing and even share our lands with them. Even so, we do not receive any recognition or compensation for our efforts.” He emphasised that the main problem in the industry at the moment was the fact that it was not united. “Everybody in the industry is struggling. If government therefore really wants to support us, they would do it best by accelerating land reform, as land reform is currently preventing people from moving on and investing in their land. By doing this government would help us to become one united industry, which would help us to have more negotiating power.” Matlala added that government would further assist the industry through investment for developing farmers regardless of whether they are white or black, male or female. “Developing farmers as well as commercial farmers need access to better financing and credit rates so that we can continue the important role we play in helping to maintain food security and rural development,” he said. – Glenneis Erasmus
