Make every link in the chain YOUR PARTNER

Published: 2 July 2024

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Dr Tobias Doyer
CEO, Grain SA

The expression that one is only as strong as the weakest link in the chain, is a proverb directly applicable to the agricultural value chain. In South Africa – where agriculture is an important sector in its own right as well as a driver for growth in the rest of the economy – cooperation and partnerships in the agricultural value chain and its overall promotion are of decisive importance for the sustainability and prosperity of this sector and for food security in our country.

Such relationships promote the potential of the agricultural sector through knowledge sharing, access to advanced technology, improved market access and increased financing and investments. It also supports environmental sustainability through collective, environmentally friendly practices, it increases resilience and risk management and promotes innovation and research. Furthermore, it leads to improved production quality and standards and it contributes to community development through job creation and economic growth. The end result is a productive and profitable agricultural sector for the benefit of all the links in the value chain.

Another important point is the role of government policy in supporting and encouraging these types of partnerships. A policy environment that encourages and supports cooperation and partnerships, promotes the growth and overall competitiveness and sustainability of the agri sector. It also ensures that the man on the street can put food on the table and that producers can survive profitably in the long term. Grain SA also strives to consistently maintain good relationships with policy makers. Without these good relationships we will not be able to influence the agri environment in which we must operate.

However, it is important to be aware of the challenges and obstacles that come with building partnerships, including the need for effective management structures, the fostering of trust between parties and dealing with issues such as power dynamics. The only way to overcome this is to continuously build long-term relationships in a sincere and transparent way.

A cornerstone
For Grain SA it is crucial to use good relationships within the value chain as a cornerstone through which our members’ cause can be promoted. In this way, we can comply with our primary objective, namely to promote sustainable and profitable grain production for our members. However, good relationships require an ongoing process of mutual understanding so that there can be a win-win situation for all the parties involved over the long term.

This sustained effort by the organisation to maintain good relations in the value chain has recently yielded good dividends. We are grateful to say that following negotiations an agreement could be concluded with grain storers whereby they extended a helping hand to soybean, sunflower and maize producers in drought-stricken areas.

Agri-businesses in particular have offered a lifeline to soybean producers by agreeing to classify green soybean kernels that went over the 10% mark as Grade 1. By doing this, they were willing to give up a financial advantage they could have used for their own gain.

It is also commendable that silos that had storage capacity available agreed to store surplus small maize and sunflower kernels. This was done with a view of finding possible markets for these seeds in order to moderate the losses of drought-affected producers in this instance as well. Although small kernels that fall through the sieve are simply subtracted from a load’s mass, they still have a value. And it is precisely here where a win-win situation could be achieved between producers and agricultural businesses.

This good relationship between grain storers and Grain SA is clear evidence of how members of the agri value chain can reach agreements to the benefit of all. If producers cannot continue production because of insufficient profit to cover operating costs, the whole value chain will suffer.

The promotion of strong partnerships is therefore undoubtedly a requirement to ensure collective resilience in the face of the challenges that the agri value chain has to confront on a daily basis. However, members can rest assured that Grain SA is a pioneer in the application of this important principle. By building and maintaining genuine, strong relationships over the long term, we can ensure not only that the current challenges will be overcome, but that we are also ready for the future.