Reflecting on what he described as a blessed year, TAU SA outgoing president Paul van der Walt said the good yields and high commodity prices may not be enough to help farmers replace the country’s aging tractor and equipment fleet. Many of them are older than 10 years and this could start impacting on the competitiveness of South African farmers, he warned. But Van der Walt implored farmers to get financial advice before incurring debt to renew their equipment. “It’s particularly important to pay attention to the politically unfriendly environment farmers find themselves in before they renew their fleets.
The agriculture minister wants to know why South African farmers are leaving the country to settle in neighbouring countries. The answer lies in the impact government’s wealth redistribution policies are having on profitability,” he said. “At a time of food shortages and uncertainty, government is gambling with stability in South Africa by attempting to drive agriculture through ideology. This policy will need a serious rethink.” H e added that government must realise agriculture can’t be dealt with in the same way as the rest of the economy.
Fluctuations in the industry are too erratic year-on-year and the sector needs planning over five-year cycles or longer. This should be borne in mind against the backdrop of political uncertainty surrounding next year’s elections and the impact the ANC’s National Democratic Revolution is having on business confidence. Van der Walt added people must realise agriculture is a totally free economy driven by supply and demand, and that farmers can’t work on a cost-plus-profit principle. Considering all of the above, he called on farmers to settle their debts. “It’s unhealthy for an agricultural sector and for the country’s economy to have agricultural debt of between R35 million and R38 million.” – Jasper Raats
