AGRICULTURAL DEVELOPMENT STRATEGY
WATERBERG MUNICIPALITY
REPORT 1:
STATUS QUO, POLICY ANALYSIS
AND
OPPORTUNITY IDENTIFICATION
(DRAFT FOR DISCUSSION)
August 2005
AGRICULTURAL DEVELOPMENT STRATEGY
REPORT 1
CONTENTS Page
1. INTRODUCTION 4
1.1 Orientation 4
1.2 Methodology 4
1.2.1 Literature review 5
1.2.2 Identification of relevant role players 5
1.2.3 Interviews and field verification 6
1.2.4 Telephonic interviews 6
2. STATUS QUO: PRIMARY PRODUCTION IN WATERBERG 6
Table 1: Bela-Bela 7
Table 2: Mookgophong 8
Table 3: Modimolle 9
Table 4: Mokgalakwena 10
Table 5: Thabazimbi 11
Table 6: Lephalale 12
Table 7: Waterberg 13
2.1 Trends 14
2.1.1 Cropping 14
2.1.2 Horticulture 14
2.1.3 Livestock 15
3. POLICY ASSESSMENT 16
3.1 National micro-economic reform strategy 16
3.2 Limpopo growth and development strategy 17
3.3 Limpopo agriculture and forestry summit 21
3.4 Limpopo agricultural development plan 24
3.5 Waterberg district LED 25
3.5.1 Bela-Bela 27
3.5.2 Mookgophong 28
3.5.3 Modimolle 29
3.5.4 Mokgalakwena 30
3.5.5 Thabazimbi 31
3.5.6 Lephalale 32
4. OPPORTUNITY IDENTIFICATION 34
Figure 1: Meat Cluster - Meat production and processing 36
Figure 2: Regional/Zone Cluster - regional production and marketing 37
5. RECOMMENDATIONS 38
BIBLIOGRAPHY
ANNEXURE 1: Proposed business planning approach
AGRICULTURAL DEVELOPMENT STRATEGY
WATERBERG MUNICIPALITY
REPORT 1: STATUS QUO, POLICY ANALYSIS AND OPPORTUNITY IDENTIFICATION
DISCUSSION DOCUMENT
1. INTRODUCTION
Following the identification of a need to formulate a coherent strategy for agriculture in the district, the Waterberg District Municipality appointed Womiwu Rural Development, assisted by Glen Steyn and Associates, to help compile a logical plan to lead agricultural development for commercial and emerging farmers, “further contributing to economic growth, job creation and improved quality of life of our citizens.” (PGDS, 2005).
1.1 Orientation
Waterberg is the largest of six district, and cross border councils making up the Limpopo province. It has over a third of the provinces land area (14 million hectares), and responsible for almost 30% of the provinces agricultural activity, including 15% of the provinces animal production. The Waterberg is made up of six local municipalities and is classified as 90% rural. Compared with the rest of the province Waterberg is unique as it is encompasses little former homeland area, has an internationally acclaimed biosphere making up 15% of its total area. This creates its own set of challenges and opportunities.
1.2 Methodology
It is proposed that the Agricultural Development Strategy be prepared in five steps:
i. Status quo;
ii. Policy assessment;
iii. Opportunity identification;
iv. Scoping reports; and
v. Implementation strategy.
This report covers steps one to three – Status Quo, Policy Assessment and Opportunity Identification.
Establishing the status quo lays the foundation on which to build the strategic plan. The integrity of this data is important and a double pronged approach was adopted to build a ‘solid data foundation’. Data was collected from a variety of studies, reports and other data bases. Considerable information exists on the agricultural sector in the province. Numerous studies have been conducted in the primary sectors, especially by academic institutions and as part of the Provincial Governments planning process. Most of the major commodities have some capacity for reporting on producer performance and useful primary production data is regularly generated by the Crop Estimates Committee.
The second prong, as explained below, was to verify data and fill any gaps by direct contact with industry roleplayers and representatives.
1.2.1 Literature review
Appropriate data were sourced and collected either by means of electronic data scanning on the internet or data basis of institutions like NDA, StatsSA, SAMIC, Citrus Growers’ Association SA, Cotton SA, Potatoes SA, SA Groundnut, Sunflower, Wheat and Soya Bean Forums. Specific information was collected from the Crop Estimates Committee and the South African Grain Information Service (SAGIS) with regard to historical and projected information related to plantings of various crops, yields and price estimates. Data is usually more readily available on a Provincial basis. Where necessary some information was extrapolated from existing data and wherever possible this was tested and verified tested by personal interaction with industry roleplayers, sector leaders and organization representatives. Travel and site visits to the area to conduct ground-truthing exercises etc. A list of sources and personal interviews is included in the annexure.
1.2.2 Identification of relevant role players
The two major role players in Organized Agriculture in the Limpopo, Agri SA (Limpopo) and the Limpopo District Agricultural Union were contacted with the purpose of identifying prominent commercial farmers or leaders in the various farming communities to assist with the verification process. Individuals were identified in the Waterberg District, representing the total spectrum of primary production activities. Commercial farming activities conducted outside the framework of Organised Agriculture were identified on an operational basis.
1.2.3 Interviews and field verification
A range of farmers, commodity traders, production managers (NTK & MGK), and other relevant role players in all the areas of primary production were interviewed to verify crops, areas under cultivation, marketing strategies, trends and opportunities in the agricultural sector in the Waterberg District. Interviews were, where possible, conducted in a one-on-one basis and related to the specific area of operation. Where insufficient information existed, extrapolation of planted areas for various crops and yields pertaining to the specific district had to be done. This was done in a circumspect manner.
1.2.4 Telephonic interviews
Often readily available information was either insufficient or incomplete to provide an accurate picture of the industry or farming activity. Individuals were then identified and telephone interviews conducted to source or validate particular information.
2. STATUS QUO: PRIMARY PRODUCTION IN WATERBERG DISTRICT
Using the methodology described above data was collected for the major agricultural enterprises in the Waterberg area. This has been presented in a format which estimates the anticipated size of activities (eg hectares), expected production levels, associated values and employment. Linked to each enterprise are a statement on recent trends and an opinion regarding a likely future scenario. Information regarding land claims, and LRAD projects is also included. As mentioned earlier, Waterberg District comprises little former homeland area. As such by far the majority of agricultural production taking place at present is by commercial farmers, with little contribution from the emerging agricultural sector.
Data is presented in tabular format on a local municipality basis, and aggregated on a district basis.
Table 1: Bela-Bela - Estimated agricultural production for 2004/5
Restitution projects
* Letlhakaneng 64ha smallholdings restored
* Moretele 1 966ha Cattle project restored
* Maureen 62ha Residential negotiations
* Bela-Bela 1 475ha ? Negotiatons
* Ramorula Community ? ? Further research
Table 2: Mookgophong - Estimated agricultural production for 2004/5
Restitution projects
* Rooipan 1 484ha smallholdings restored
* De Hoop 678ha smallholdings negotiations
* Madisha 1 671ha agriculture negotiations
* Ga Aphane 1 239ha cattle & cropping negotiations
Table 3: Modimolle - Estimated agricultural production for 2004/5
Restitution projects
* Modimolle 12 491ha agriculture, game and tourism partnership proposals
Table 4: Mokgalakwena - Estimated agricultural production for 2004/5
Restitution projects
* Mabjaneng 3 706ha reserve business plan being compiled
* Legata 1 671ha reserve strategic partner secure
* Lebelo 3 600ha agriculture discussion with CSIR
* Koka Matlou 2 955ha cattle proposal from Strategic Partner
* Seema 1 848 cattle resolution of boundary dispute
* Lehutjo 838ha negotiations
* Molekwa further research
* Sindane 3 984ha negotiations
Table 5: Thabazimbi - Estimated agricultural production for 2004/5
Restitution projects
* Baphalane 1 884ha cattle and lodge business plan being compiled
* Sebilong further research
* Motihabatse Community further research
* Mabula Mosima further research
Table 6: Lephalale - Estimated agricultural production for 2004/5
Restitution projects
* Mosima 9 607ha reserve proposals invited
* Tale Ga Morudu 8 628ha reserve, cattle planning
* Morongwa 3 752ha game partially settled
* Motse further research
* Mokoena Community further research
* Majadibodu further research
* Matabane Community further research
* Mathole family further research
* Mokitlane further research
Waterberg Agricultural Strategy 2 Report 1: Discussion document
Table 7: PRODUCTION STATISTICS - WATERBERG DISTRICT, 2005
(Compiled from various sources. See references.)
1 STATSSA, Census 2001.
Waterberg Agricultural Strategy 2 Report 1: Discussion document
2.1 Trends
Since the general deregulation of the agricultural industry in the nineties commercial agriculture has had to undergo significant transformation. This has affected virtually every facet of agriculture. Not only have farmers had to re-assess their traditional enterprises, make better use of their resources and become involved in value adding and marketing to a much greater degree. The poor producer prices, over the last few years, have also but the sector under financial pressure.
2.1.1 Cropping
Although named the Waterberg the district is actually classified as a semi-arid area with poor water resources. For crop farmers there have been dramatic changes in many commodity prices leading to changes in cropping patterns. Crops such as cotton, tobacco, maize and sorghum have been badly affected by low international prices and over production and plantings have been reduced significantly, often with negative financial and employment implications. Alternative crops like sunflower, wheat, soya beans, groundnuts and paprika are all internationally traded commodities and thus sensitive to the rand/dollar exchange rate. These crops therefore are limited substitutes. Lucerne appears to have some potential, especially with the movement towards game ranching, although demand is sensitive to seasonal conditions. Potato production also has some potential although entry is constrained by high input costs. In general there is little cropping that takes place without some form of irrigation. With demand on water resources increasing consistently crop farmers are going to have to examine their returns on the use of water in future.
2.1.2 Horticulture
The horticulture enterprises appear to fair slightly better. Although table grape planting have declined and exports are highly competitive, citrus and the stone fruit production is expanding. Carefully selected micro climates in the district are highly suited to quality production allowing for high export percentages and carefully managed marketing windows overseas. Citrus, for example is a large consumer of water, but has an equally large return, especially on exports. Indications are that this expansion will continue.
Vegetable production is widespread and vibrant. Producers range in size but tend to operate around urban areas on smallholdings and plots. Markets vary just as widely – from end users to the Fresh Produce Markets of Johannesburg and Pretoria. Due to the scattered nature of production, markets and ease of entry and exit, it is difficult to obtain accurate production estimates. There do appear to be some characteristics of the industry. There is little co-ordination of supply and marketing, and with the exception of packaging, little value adding or processing.
2.1.3 Livestock
Intensive livestock production has increased in the area over the last few years. In Bela Bela a day-old broiler chick facility has been established, supplying day-olds to Mpumalanga and Limpopo. The broiler rearing facility, also in Bela Bela has expanded. This industry is highly competitive and subject to small margins, making opportunities for small-scale producers limited. Egg production is fairly stable with a couple of larger producers and several smaller producers. Although there is one large producers who dominates production in the province there is some opportunity for smaller producers who can supply local markets without incurring significant transport costs.
Pork production remains stable with little opportunity for expansion, especially for exports. Margins are also small and therefore not well suited to small scale production. There are several small dairies in the district that supply to local consumers and distributors in Polokwane. Although the area is regarded as too warm for milk production the variable geography of the district may allow for a number of smaller-scale dairies.
The crocodile industry has become well established in recent years. There are several producers but information on production and profitability is difficult to access. It appears that this may be an area of expansion in the future, especially for existing producers.
The cattle and game industry is undergoing significant transformation. Lead by water constraints, areas previously under dryland and irrigation are being consolidated and converted for extensive livestock production. Similarly other former cultivated land and livestock grazing is being converted to game ranching and eco-tourism. Even within the game ranching industry owners are diversifying into lodges and eco-tourism. This general trend has been encouraged by the establishment and development of the Waterberg Biosphere. This trend is expected to continue.
3. POLICY ASSESSMENT
Development is about introducing changes to improve the local economy, and through this, the well-being and quality of life of our communities. These changes come about from specific activities that have been carefully considered as part of an overall strategy to influence change in a certain way. This strategy should, in no small way, be guided by broader guidelines and plans. These broader guidelines ad plans come in a number of forms, but can be referred to aggregately, as policy. It is generally regarded that government, in its different forms, sets policy through a variety of means, much of it by participative and consultative means. A number of policies have the potential to influence agricultural strategy at the District Municipality level, especially as donor, public and ratepayer resources will be applied to achieve the strategy objectives. The following policies and strategies have been identified as having potential influence on the agricultural strategy of the Municipality.
3.1 National micro-economic reform strategy
At the present economic growth rates, government will not be able to achieve its job-creation and poverty reduction objectives. The sound macro-economic policy that is in place will therefore, have to be augmented with a micro-economic reform strategy. For this purpose, government has selected the following five focus areas:
- Agriculture:
Government and the organised agriculture sector, including established and emerging farmers have jointly developed a strategic plan for agriculture. It gives priority to high value-added and export-orientated commodities and also promotes competitive supply chains.
- Cultural Industries:
Government is taking action to promote music, film and television, audio-visual services, publishing and crafts.