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THE
GRAIN AND OILSEED INDUSTRY
OF SOUTH AFRICA – A JOURNEY THROUGH TIME
ႃႆ
In the baking industry literally thousands of new bakeries were established, but by
1999 roughly 80% of the bread in the country was baked by only six groups. In
2000, 80% of the wheat meal and 65% of the bread in South Africa were produced
by only four groups (Pioneer Foods, Tiger Brands, Premier Foods and Foodcorp).
Exports
In the previous dispensation the control boards had full control over the exporting
of agricultural products. However, since the commencement of the 1996 Act there
was no export control, except for quality control measures.
Phasing out of control boards
Under the 1996 Act all the marketing schemes of the 1968 Act had to be phased
out by 5 January 1998. However, the control boards had assets and staff as well as
industry commitments and obligations that had to be managed out.
The new Act required existing control boards to submit a business plan to the
Minister of Agriculture and the NAMC within 30 days of the first meeting of the
NAMC, with recommendations on the way in which the control board concerned
would manage the termination of operations.
Requests by the industry for statutory measures also had to be motivated fully in
the business plan. The core principle was that a statutory measure and proposals for
the restructuring of the functions of the control boards had to be supported by the
industry with consensus recommendations. In the absence of a consensus recom-
mendation the minister could decide on his own measures for deregulation.
There are different views that prevailed about the way in which the assets of the
control boards had to be disposed of. Buyer groupings argued that they belonged
to the consumers because they were recovered from them in the prices of products.
The producers felt that they belonged to them, because they had been collected
from them by way of levies, while the government’s view was that they belonged to
the government.
Eventually it was agreed to establish industry trusts for the different industries,
mainly in order to administer the assets from the different control boards and utilise
the funds from these to promote the individual industries focussing on research and
information needs.
In time the Trusts funded various developments and initiatives to the benefit of the
grain industries. A few are outlined below:
Maize Trust
The provisional business plan for phasing out the Maize Board was submitted to
the NAMC on 31 January 1997 after it had been approved by all the direct interest
groups as represented in the Maize Advisory Committee. This included that certain
important functions for the industry that had been handled by the Maize Board,
for instance market information and laboratory services, would be moved to other
structures.
After the commencement of the 1996 Act the Maize Board was reduced to five board
members and five persons were contracted to close off the affairs of the Board, for
example the sale and transfer of assets and the collection of outstanding levies,
which was accompanied by court cases that were completed only a number of years
later. Ultimately all the Maize Board’s assets, including the Maize Board Building in
Pretoria, were liquidated and the funds transferred to the Maize Trust.
With the dissolution of the Maize Board it possessed reserves of about R240 million.
In contrast, the Stabilisation Fund, referred to in Chapter 1, had an almost equalised
deficit and initially the Minister wanted to set off the two amounts against each other
on the basis of the argument that it was an obligation of theNational Party government
and not of the new government. Eventually it was agreed that the maize industry
could keep the reserves, provided that they were kept in theMaize Trust, the objective
and provisions of the trust deed of which had to be determined by way of agreement
and had to make specific provision for transformation and development.
Sound bite: After the Maize Board was closed
down, the Maize Trust was founded – Mr Vic
Mouton.
