A JOURNEY THROUGH TIME

THE

GRAIN AND OILSEED INDUSTRY

OF SOUTH AFRICA – A JOURNEY THROUGH TIME

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Control Amendment Act (Act 59 of 1935) was promulgated. This Act made provision

for the establishment of the Mealie Industry Control Board, the precursor to

the Maize Board. Initially this Board was appointed as an advisory board on the

recommendation of the Commission of Inquiry into Co-operation and Agricultural

Credit, which had strongly advised against the introduction of single-channel

marketing for maize.

Since the commencement of the Marketing Act of 1937 the Maize Board functioned

under that Act, and its status changed from an advisory board to a full control board.

The problems experienced with the quota system led to an amendment of the

legislation in this regard in 1937, and resulted in the Maize Board, among other

things, becoming a clearing house for quota certificates at fixed prices. This

eliminated speculation with the quotas and accomplished better control over the

exporting of maize.

At the same time the Board was given ‘authority to determine the maize price and

export and storemaize’. Themain aimof the Board was to introduce stability into the

maize industry by eliminating excessive price fluctuations, promoting production

efficiency, retaining soil fertility and creating a balanced relationship between the

interests of the producers and other role-players in the market.

The decision to authorise the Maize Board to enforce single-channel marketing for

maize was preceded by a long drawn-out and difficult process. When the Mealie

Industry Control Board convened for its first meeting on 12 July 1935 under the

chairmanship of Dr PR Viljoen, the Secretary of Agriculture, a subcommittee was

appointed at the request of producers to investigate the possibility of single-channel

marketing. Although the first ideas about this were nipped in the bud, it did not

disappear from the scene and was tabled repeatedly. Time and again various

arguments in favour of as well as against the introduction of single-channel marketing

system were heard.

While the debate on single-channel marketing continued, maize supplies varied enor-

mously from year to year. In some years, for instance in the 1938/1939 season, large

surpluses were produced, while material shortages were experienced in other years.

This led to drastic measures by the government in the form of an ‘interim’ Maize

Control Scheme that gave the Maize Board the following powers:

• Control of exports through a permit system;

• the introduction of a levy to ensure that domestic prices remained higher than

import parity and the provision of funds for paying export subsidies;

• the right to purchase maize for own account; and

• the right to oblige any person dealing in maize or maize products to report

monthly to the Maize Board on transactions completed.

During 1941/1942 the consumption of maize in South Africa started to increase,

which led to traders withholding supplies in anticipation of price increases resulting

from the greater demand. This led to the Maize Board being authorised by the

Minister to fix the selling prices of maize and maize products from November 1941.

In January 1942 the Board was also authorised in terms of War Measure 20 of

1942 to claim maize from persons who had stored more maize than required to

meet their immediate needs. At the same time the Maize Board was authorised to

appoint agents to receive and distribute maize on their behalf – all steps in the

direction of greater control.

In 1942 the maize crop for the next season was expected to be very poor and a fixed

producer price for maize was announced – the first in the history of South Africa.

The government also announced measures with respect to the sale, distribution

and consumption of maize. This included a permit system and a restriction on the

manufacturing of maize products. InMarch of that year a food control organisationwas

established and the different control boards that were already functioning in terms of

the Marketing Act at that stage joined it at the request of the Minister of Agriculture.

Single-channel marketing

Everything therefore pointed to the government trying to exercise greater con-

trol over the marketing of agricultural products. This view was strengthened by a

Maize is weighed on a platform scale.

A typical scene of maize being shipped at a

South African port.