Everyone’s contribution needed to create an inclusive sector

SA Graan/Grain editorial team
Published: 8 May 2023

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Despite the fact that the Agricultural Development Agency (AGDA) was launched just before the onset of the Covid-19 pandemic in 2020, it was making strides in supporting an inclusive farming sector in South Africa. This was according to Dr Mathews Phosa, chairperson of AGDA, at a round table discussion on the implementation of the Agricultural Master Plan (AMP) held in Pretoria.

The launch of the agency followed the renewed focus on transformation in the agriculture sector and the Agri BEE Sector Code of 2017, which gave new transformation targets to the sector.

AGDA is part of the Public Private Growth Initiative (PPGI), which was established in 2018 under the leadership of the late Dr Johan van Zyl, then CEO and president of Toyota in Europe. AGDA is governed by a board of directors constituted of an equal number of representatives from government and the private sector, working together to achieve the common goal of sustainable and accelerated land reform to the benefit of South Africa and all its people.

Opening the round table discussion, AGDA CEO, Leona Archary, said that partnerships were the only way to achieve the implementation of the AMP in South Africa. ‘Together we can drive economic growth and build South Africa to where it should be. Ideas must move into implementation and that is the purpose of today’s discussions,’ she said.

The aim is to align strategic planning between government and the private sector, in the interest of improving economic growth and the manner in which government and business work together. AGDA has one important goal – to empower developing black farmers.

‘To drive and execute the AMP, we need to integrate, aggregate, facilitate and implement. The AGDA is the ideal vehicle to use to achieve these goals. We are the soldiers to execute the plans.’ This was the message given by Dr Phosa at the round table discussion.

Dr Phosa added that every accomplishment started with a decision that was implemented. ‘A decision was taken to write the AMP, and we decided to establish AGDA. Now we must act and implement our decisions and discussions.’

Growing the economy
Dr Phosa said that agriculture has a major role to play to grow the economy and added that the sector has the ability to contribute to youth employment across the value chain. ‘The new technologies available on all levels in the sector offer a platform to young people to become involved. There are various opportunities for hard-working young people,’ he said.

Minister of Agriculture, Land Reform and Rural Development, Thoko Didiza, agreed in her address that the day’s discussions could pave the way to driving the implementation of the AMP. ‘Inclusive agriculture in South Africa is possible and there are many examples as testimony to this, but we need to build on those to implement the master plan and grow the economy.

‘Many people are passionate about agriculture and the majority of them can offer expertise based on vast experience. Collectively we must look at what we have and know and contribute that to grow the sector and the economy. Everyone’s contribution is needed to complete the puzzle,’ she pointed out.

Better access
Dr Phosa added that inclusiveness across the food value chain is necessary to obtain household food security. ‘Developing a sustainable and inclusive agricultural sector in South Africa will contribute massively to household food security, job creation, rural development, meaningful land reform and emerging farmer empowerment. Landmark events are also needed to boost the agricultural sector’s transformation efforts.’

The AGDA Integrated Farmer Development Programme (IFDP) will provide participating emerging smallholder farmers with services such as whole farm assessments, development plans, skills transfer, partnership, accounting services and project management services.

Most emerging farmers in South Africa operate outside the main-stream agricultural value chains and are often unable to gain access to markets without support. Being part of a value chain is one of the critical pillars of sustainable farming and without access to markets farmers are almost certainly set up for failure. Being part of the IFDP can enable emerging farmers to implement the key factors required for being a successful farmer and to become part of the value chain. The focus is on capacity building, skills transfer, market readiness and market access.

‘Access to the agricultural value chain can hugely contribute to creating an enabling agricultural environment where an emerging farmer can become part of the main-stream agricultural sector. This can also create opportunities to fund the commercialisation of emerging farmers in a sustainable manner,’ Dr Phosa added.

In his address to the attendees at the round table discussions, recently, Roelf Meyer – one of the main drivers and board member of AGDA – drew attention to the main objectives of the agency. These are to promote and support access to agricultural land by black and emerging farmers, and to support the use of agricultural land and infrastructure development so as to promote land reform and food security in the country.

Meyer said that AGDA has the specific purpose to ensure the provision of appropriate training, as well as support and assistance to emerging farmers to improve capacity and access to agricultural markets in particular.

AGDA aims to achieve the following objectives:

  • Direct job creation at farm level;
  • indirect job creation throughout the value chain due to increased activities;
  • food security;
  • training and skills transfer for all employees;
  • business management training for emerging farmers;
  • wealth creation for emerging farmers; and
  • transformation in the agricultural sector.

Only through the pursuit of these objectives in partnership with government will the sector and the country be able to include everyone who have ambitions to work in agriculture, Meyer said during the official launch of AGDA in 2020.

AGDA also facilitates skills transfer from commercial farmers and private sector agri-businesses to identified beneficiaries. This is achieved by supporting existing initiatives and by funding targeted projects.

Discussing the role that commercial producers can play to support the implementation of the AMP through best-practice scalable models, CEO of the Schoeman Group and AGDA board member, Kallie Schoeman, pointed out five key aspects from the AMP that needed implementation. These points are:

  • To promote transformation;
  • to increase food security;
  • to enhance competitiveness;
  • to further inclusiveness in the agricultural value chain; and
  • to secure financing for farmers.

‘These five points can be achieved through partnerships with commercial producers. Government is good at making plans, but farmers are the ones that can implement,’ Schoeman said. He added that there are many examples of projects where commercial farmers are involved and where they, to a great extent, carry the risk on behalf of new era farmers. Referring to the Zamukele Farmers’ Programme, Schoeman said that farmers that are incorporated into the food value chain are on the first steps towards success.

‘The Zamukele project aims to empower emerging dry bean farmers towards becoming commercial farmers. The project identifies and supports farmers by providing access to mentorship, technical advice, certified seed, fertiliser, chemicals and local and international markets. Farmers are provided with the seed and fertiliser at the start of the growing season and then they make payment for these inputs after the crop has been harvested. The project participants are effectively contract growers, as they know that whatever they harvest will be marketed to the Schoeman Group,’ he explained.

‘Love for the soil and a true passion for farming is important but not enough. Farmers need someone with experience who can guide them through the pitfalls of the industry,’ he said.

Minister of Agriculture, Land Reform and Rural Development, Thoko Didiza, addressing the partners attending the round table discussions on inclusiveness in the agricultural sector and the implementation of the Agricultural Master Plan in Pretoria.

Funding
Regarding funding, the IFDP will be funded from impact capital sources, providing mainly grant funding for the development of farmers. After graduating from the IFDP, emerging smallholder farmers can get access to the Revolving Loan Fund (RLF) in order to upscale their businesses to a commercial level.

The RLF will raise capital from various sources and on-lend it to commercialising farmers in a defined value chain. Capital will be recycled to enhance the reach of the fund. The three sources of funding will be private equity, impact capital and commercial debt.

AGDA will also coordinate cooperation agreements with various industry organisations to provide emerging farmers with enterprise development services such as feasibility studies, preparation of business plans, training and mentoring, technical services, accounting services and project management services.

This funding and support model brings together all the key success factors required to reduce the funding risk to acceptable levels, creating the opportunity to spread the risk among different participants.

AGDA believes that it can make a positive contribution towards growth, inclusiveness and social cohesion in the agricultural sector. It remains committed to driving partnerships and projects that can contribute to improve livelihoods, address poverty, inequality, unemployment and equal access to markets.

‘We must integrate, aggregate, facilitate and most importantly, implement our plans,’ Dr Phosa stressed.

Grain SA is one of the member organisations partnering with AGDA. One of the programmes that is making great strides in terms of transformation, is the Grain SA Farmer Development Programme.

‘The support and mentorship of commercial farmers and the farmer development team at Grain SA, have had an enormous impact on the participants in the Farmer Development Programme. At Grain SA we wish to address food security, but we also want to help generate an income for those who have access to land. We are blessed to be working in a sector that has the potential to contribute to all the pillars of rural development,’ Dr Pieter Taljaard, CEO of Grain SA, added.