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April 2016
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Drought: Agri SA leads
planning and recommendations
A
lthough we can learn lessons from the way people coped
with the drought in the past, the playing field has chang-
ed. New challenges require new thinking and careful plan-
ning to come up with constructive recommendations.
Mr Omri van Zyl (executive director: Agri SA) puts the agricultural
sector under the spotlight as it reels under the shock of the current
drought.
Facts
Some facts about South African agriculture:
12% of South Africa is arable land but a mere 3% is truly fer-
tile. The 1,5% under irrigation produces 30% of the crops in the
country.
Agriculture’s contribution to the national gross domestic product
(GDP) dropped from 21% in 1910 to 2,5% in recent years.
Sector performance is influenced by uncertain climatic con-
ditions.
About 20% of the producers produce 80% of the output.
Deregulation in 1990 - 1992 triggered an industry which has
grown into a success story.
Sectoral turnover during 2014/2015 amounted to R77 063 mil-
lion.
In 1952 there were 120 000 farming units in the country com-
pared to the 35 000 of today.
There are still more exports than imports. Is South Africa food
secure? Yes. How many countries in Sub-Saharan Africa are food
secure? Only one: South Africa.
Meeting the challenges for today
A Drought Task Team has been constituted by primary stakeholders
in the sector including government departments – most provinces
have been declared disaster zones. Assessments have been made
to identify regions/commodities in trouble, in order to anticipate the
need for assistance on a national basis.
The next two months will reveal the full picture, depending on
rainfall. It is very likely that we will have to import grain to meet
domestic needs. Many producers have no feed for their animals and
are being forced to off-load while future feed prospects and acces-
sibility are of concern.
Agricultural production will have to recover quickly. If this cannot be
done, there will be food insecurity, hyper-inflation and large scale
job losses in the sector. People will migrate to urban environments
where they might have greater opportunity to find food and oppor-
tunities for a livelihood. Small producers have been severely affect-
ed by the drought and many will retrench farm workers adding to
unemployment – a serious social challenge for South Africa.
Risks
What are the greatest risks in managing this situation? Little ef-
fective support to producers; carry-over debt problems are not
addressed; food security risk; rise of unemployment and job losses;
the erosion of a tax base (loss of producers); the socio-economic
decline of rural areas; an absence of infrastructure and the capacity
within government to ‘deploy funding’ effectively.
A proposal to put on the table
Agri SA has worked on establishing the cost of drought interven-
tions by calculating the financial needs for commercial and small
holder producers to survive. The total fiscal outlay required for
producer assistance in the 2016/2017 year is: Best case scenario
= R7 119 100 000, medium case scenario = R11 590 120 000 and
worst case scenario = R16 572 900 000.
This includes subsiding feed purchases, grants/provision of inputs
to small-scale producers, soft loans to producers who can’t access
FEEDBACK
Congress
Special
JENNY MATHEWS,
SA Graan/Grain
contributor
Omri van Zyl
– Omri van Zyl