South Africa: Internal food market grows

Farmers Weekly rounds up a year’s news through the eyes of farmers across the globe. Today we hear from Danie Schutte in South Africa

Danie Schutte runs an organic dairy farm consisting of 90ha in the east of Pretoria, South Africa.

South African farming has changed radically over the past 20 years. It has moved from being highly regulated to a completely free market. Commercial farmers receive no subsidies, but are increasingly subjected to “negative” subsidies – additional input costs due to deteriorating infrastructure and security concerns.

The number of farms has fallen from more than 60,000 in 1996 to an estimated 38,000 in 2012.

To address inequity, the government introduced a land distribution policy, from white farmers to disadvantaged black workers. But due to a lack of capacity and skills only an estimated one in 10 redistributed farms remains productive.

Key facts

Population 51.5 million

Average rainfall Varies between 5mm in the west and 1,500mm in the east

Agricultural area 99m ha

Wine production is increasingly important with the 60,000-strong workforce matching the number of workers in the dairy industry

Despite these challenges, agricultural production has increased steadily by about 2% in 2011-12. Dairy production grew by an average of 3% during the same period. In the decade between 2000 and 2010, total solids (butterfat and protein) production increased by 16%.

The average maize yield increased from 2.4t/ha in 2000 to 3.8t/ha in 2011.

That said, this year’s production improvement has been balanced by substantially increased costs, with fuel and electricity leading the charge. This has put profit margins under pressure.

I am nevertheless optimistic. The internal food market is growing by about 4- 6% a year and has great further potential, provided that the general economic situation remains stable. The export market, especially into Africa, also shows promise.

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