Land reform solutions enable best of breed enhancements for farmers
South Africa has a low agricultural potential compared to other agriculturally competing countries and it is therefore imperative that available agricultural land be used optimally.
According to the Department of Rural Development and Land Reform’s Annual Performance Plan 2013-2014, a total of 6 971 293 hectares of agricultural land was transferred to black emerging farmers and non-farming beneficiaries between 1994 and 2012.
In keeping with the trend of other developing economies, South Africa has a large percentage of farm land belonging to small-scale growers; it will take some time before large farms are consolidated into business sensible economies of scale. This will, to an extent, have an impact on the way in which most input suppliers do business, including Omnia.
Business involvement in the emerging farmer sector should not be limited to a developmental input, but rather form part of the business strategic imperative. The integrity of input supplier systems should be maintained when there is a transfer of land between established farming systems and new farmers.
The agricultural macro-environment of land reform and redistribution may influence the company's bottom line, and the strategic response to keep redistributed agricultural land in production is key to remaining competitive as the industry transforms and the dynamic between buyer and supplier changes.
Through Omnia’s core practice of creating value for the customer by leveraging knowledge, its enhanced fertilizer product offering and its business development convergence, the company has been engaged in the emerging farmer sector for the last nine years with the following projects as examples:
- The Peppadew Project The partnership between Omnia Fertilizer and Peppadew International on a risk sharing basis has seen 10 farmers in the Limpopo Province benefit by planting piquanté peppers and supplying them to the Peppadew International factories in Nkowakowa, Tzaneen on an off-take agreement basis.
- The Grain Production Commercial Project Omnia Fertilizer takes full responsibility for this initiative which operates in the Mpumalanga, Free State and the North-West provinces and comprises 9 919 hectares of maize, sunflower and soya crops. At an average of 290 hectare per farmer, 35 beneficiaries participate in the scheme.
- The Colin Forbes Story A commercial farmer in Amsterdam (Piet Retief) allocated 60 hectares of farm land to his employees in an employee empowerment scheme with Colin being the mentor. This scheme has been harvesting on average nine to ten tons per hectare of maize and three tons per hectare of soya for the past season. The enterprise has the added advantage of positioning the employees-turned-farmers into goal-oriented individuals.
- The Just Veggies Vegetable Scheme The Just Veggies agri-processing facility is situated in Coronation just outside Vryheid. Vryheid, with its good soils, sufficient rainfall and suitable weather, is an ideal place for vegetable production. A vegetable production partnership has been formed between Just Veggies, Omnia Fertilizer, McCain and Bayer Crop Science to assist in restoring the unproductive land back into production, resulting in job creation and community upliftment. This scheme is funded by the Public Investment Corporation; the community is a shareholder in the business and is engaged in the established mentorship facilitated by the Department of Rural Development and Land Reform.
- South African Breweries/Farmwise/Omnia Project A total of 1 000 beneficiaries participate in this project funded by South African Breweries and the Department of Trade and Industry. The project area stretches from Underberg to the KwaZulu-Natal (KZN) Midlands. Maize has been planted on 1 500 hectares with the possibility of doubling this capacity in the next season as high potential land is available. These farmers are beneficiaries of land reform in KZN and continue to receive support regarding mechanisation and contracting on some of the cultivation done on the land.