Davos: #4IR, the middle class and saving ourselves

The news from the World Economic Forum 2016 (WEF) is abuzz with reports of the Fourth Industrial Revolution - #4IR. [The first two used water/steam and then electric power to create mechanised and mass production. Electronics and information technology followed, and now we have digital which is “characterised by a fusion of technologies that is blurring the lines between the physical, digital and biological spheres” (WEF, 2016). ]

We hear today that the 62 richest people in the world now own as much as the bottom 3.5 billion (WEF Trust Survey). The rich continue to get richer, the poor poorer and the middle class is being “hollowed out”.

Generally, commercial farmers fall in the middle class bracket. Agriculture in Greece faces the knockout punch as a result of the latest austerities; there are challenges for farmers worldwide, but a brief look at the SA picture: SA operates on a planet that had its hottest year on record in 2015. The drought here (the worst on record) is a major blow to many, compounded now by rumours of another, giant leap in the energy price. With over half the population in SA already food insecure, the drought will place the price of food further beyond the buying power of the poor. And measures like energy price hikes in this context threaten the production of food itself.

US Deputy President Joe Biden spoke of the danger of losing something special when we lose our belief in the possibility of a better life, namely “the soul of our humanity that no machine can replace”.  His speech outlines steps to strengthen the middle class and the way to it:

• Invest in education and training
• Strengthen core social protection and obligations to employees
• Modernise infrastructure
• Ensure a progressive tax regime so that all pay their fair share of the taxes
• Make capital more widely available

Writing on the WEF today, Lionel Bisschoff offers suggestions for SA, after pointing to the unlikelihood of the current 8 million unemployed ever being able to find work in agriculture, manufacturing or corporate services (machines and “digital clones” will do the work as a result of #4IR). Bisschoff says we need to reform our current monetary system: our debt and interest based system of money creation will not work for us. Following on this, through the creation of “locally constrained money”, millions of our unemployed will build infrastructure. These two points are explained in his article.

We don’t have much more time to stop the alarming patterns of inequality. If we don't strengthen the middle class and the way to the middle class, #4IR will have made these patterns worse next year this time. The steps proposed by Biden and Bisschoff hold promise but do we have the will to change?

New Agri Handbook on the horizon

Of interest to agricultural stakeholders is that the next edition of The Agri Handbook for South Africa is in the pipeline.
 
As visitors to this website and role players familiar with the previous editions know, the publication gives you an orientation to every part of the agricultural value chain. This is helpful whether you have inherited some land and want to see what the options are, or if you have been farming for years and are thinking of diversifying your operations. What does processing milk entail, for example, and who can help me? What should I consider before farming with fish?

The next edition will be released electronically, in modules, while we wait for the print arrangements to come together. As opposed to an in-house production, much here depends on arrangements and co-operation outside of the (small) company. Patience is involved - thank you so much - and the result is always worth it (find the comments and feedback under the The Book option on the website).

The first module will be an introduction along with a supplier guide. Chapters will include agriculture in the provinces, organised agriculture, labour and agriculture, agribusiness and an introduction to SADC (the Southern African Development Community).

These will be followed by:

• MODULE TWO: Agricultural training & careers
• MODULE THREE: Infrastructure
• MODULE FOUR: Mechanisation
• MODULE FIVE: Inputs
• MODULE SIX: Marketing & finance
• MODULE SEVEN: Services & technologies
• MODULE EIGHT: Agronomy
• MODULE NINE: Horticulture
• MODULE TEN: Forestry & industrial crops
• MODULE ELEVEN: Livestock
• MODULE TWELVE: Natural resource management
• MODULE THIRTEEN: Value add & processing
• MODULE FOURTEEN: National & international issues 

 This will begin happening in stages next month and into the early part of the new year. Watch this space!

Comments open for draft AgriBEE Sector Code

Members of the public and other interested parties have until 19 January 2016 to comment on the draft AgriBEE Sector Code.

The Department of Agriculture, Forestry and Fisheries (DAFF), together with the AgriBEE Charter Council, on Monday announced the approval of the Draft Amended AgriBEE Sector Code, in terms of section 9 (5) of the BBBEE Amendment Act 46 of 2013.

The AgriBEE Sector Code was published on 20 November 2015 in the Government Gazette as Gazette Number 3 9429 (Notice 1 160 of 2015).

The Draft Amended AgriBEE Sector Code has been aligned with the Amended BBBEE Codes of Good Practice.

“Comments are invited from stakeholders and the general public on the Draft Amended AgriBEE Sector Code during the 60 days public comments period, which ends on Tuesday, 19 January 2016.  All comments must be submitted in writing. The contact details are provided in the Government Gazette Notice,” DAFF said on Monday.

The AgriBEE Charter Council and DAFF, together with the Provincial Departments of Agriculture, plan to engage relevant stakeholders during the 60 days public comments period.

Further details will be communicated to sector stakeholders through the provincial Departments of Agriculture.

The Amended AgriBEE Sector Code will be finalised in terms of Section 9 (1) of the BBBEE Amendment Act 46 of 2013 after incorporation of Public Comments.

It will become effective and applicable to all enterprises and business entities operating in the agricultural sector for purposes of measuring their BBBEE compliance annually.

The scope of application of the Draft AgriBEE Sector Code includes the primary production of agricultural products; the provision of inputs and services to enterprises engaged in the production of agricultural products; the beneficiation of agricultural products - whether of a primary or semi-beneficiated form; and the storage, distribution, trading and allied activities related to non-beneficiated agricultural products.

Find the Broad-based Black Economic Empowerment pages on the Department of Trade and Industry's web pages here.

Source: SANews 2015-11-24

Matatiele farmer reaps reward of a dream come true

In David Mongoato’s office is a picture of himself as a small child, standing in a field of tall, ripe maize plants. He knew than that he wanted to be a farmer.

But the path to your destiny is seldom a straight one. David and his wife Selloane worked as teachers for many years before he was able to return to the rich Eastern Cape soil that he loves.

The Mongoatos now run a thriving 947-hectare maize farm near Matatiele, with the Drakensberg and the Lesotho border nearby. The farm was acquired by the State as part of its land reform process. But simply having access to land doesn’t make you a successful commercial farmer.

A loan from the Masisizane Fund allowed the purchase of crucial equipment such as farm implements, as well as providing start-up capital for them and 14 other emerging farmers in the area.

The fund is a non-profit company established from unclaimed shares by the Old Mutual Group in 2007, in consultation with National Treasury. It lends development finance, with a key focus on improving the sustainability of small businesses.

The Mongoatos’ farm is at the core of a partnership of 15 farms, which share some resources, such as silos where maize can be stored until prices improve. It’s a cluster of small operators whose enterprises are independently owned but they work together to get contracts. They can build a support structure of services to keep income in their community rather than having to contract and so lose revenue, explains David.

Caption: Daniel Chabana, field officer for the Masisizane Fund, with farmer David Mongoato.

Picture credit: Benna Carroll

So far it’s working well: “I’m running out of arable land so I may need to lease land to plant more maize,” he says. He adds that the farm now has a piggery and plans are afoot to reopen the dairy, which Mogoato says could initially provide much-needed nutrition to local schools. It could then become a commercial undertaking and the Mogoatos would have a fully-fledged mixed-farming operation.

But the farmer with a lifelong love of the land has a longer view than that: another tractor would help meet the farms’ year-round needs, from preparing soil, to planting, spraying, fire-prevention, maintenance of farm roads and so on. There’s clear evidence of the need for the latter, with many farm roads in the area virtually impassable in the wet summer months. Better roads mean better access to markets, with benefits to the entire community and the rural and national economy.

David adds: “Most of my profit goes to hiring a combine harvester and they’re in such demand that there’s a waiting-list. Getting finance for one would make sense. We’d hire it out and it would pay for itself pretty quickly, plus the farmers in the area would get their crops in quicker.”

He says growing the farm is a challenge, but one he loves: “This doesn’t feel like hard work when you’re doing what you love. It’s demanding, but there’s the thrill of planting and making what you planted grow, and seeing it turn into something you can sell. It provides for you and your family and creates jobs and dignity in your community.”

Does he miss teaching? In a way, he hasn’t left it: he mentors other emerging farmers in the area and he has a succession plan in place for the family, with the couple’s four children working on the farm during holidays, donning gumboots and learning to farm.

David can treasure other pictures now: one of him surrounded by nearly 800ha of maize, all of it taller than him; others, of the harvested maize pouring into a silo like amber rain, of workers weighing and sealing bags of it, ready to be trucked away.

Daniel Chabana, field officer for the Masisizane Fund, says: “The 15 farms working together gives them some economic muscle and voice in local affairs. It’s completely in line with the fund’s mandates of employment creation, poverty eradication and reduction of inequality and contribution to economic growth.”

The Masisizane Fund has a strong focus is on women, youth and the disabled, particularly in economically depressed parts of the country: rural and peri-urban areas and townships. It was established as a Section 21 company following the closure of the Old Mutual Unclaimed Shares Trust in August 2006 and aims to contribute towards the economic transformation of South Africa.

Source: Meropa Communications

Water licenses and Obama's ultimatum

On Friday, the Afrikaans agricultural magazine, Landbouweekblad, carried the article "Hoe moet boere vir droogte aanpas, minister?" [How should farmers adapt to drought, minister?] The piece was written in response to the national government's lack of interest to assist the country's commercial farmers in the face of the worst drought in over three decades. 

Various permissions are required to use the water on one's own farm, be it to irrigate or to build a dam, an accepted intervention to hold back water for a time of need. At the time of the National Water Act of 1998, it was envisaged that managing agencies in nine catchment areas would be set up to process applications for licenses. In 2015, only two are in place. And it takes years after making an application to receive a water license! One appreciates the indignation caused by the casual ministerial comment and how keenly farmers feel the effrontery of it all.

Apart from the standard risks any person faces when what is important is in the hands of bureaucracy --  intransigence and incompetence -- the commercial farming community faces an additional hurdle, the ambivalence with which it is viewed by government. On the one hand, it is an ideal job creator, earner of foreign exchange and the reason for the country's food secure status. On the other hand, the continued skewed land ownership ratio is a blot on the government's performance sheet. Reasons vary and we won't go into them here; suffice it to say that none of this helps the country much.

Also in the news on Friday (carried by news sources beyond these shores, like the Guardian and BBC), an ultimatum issued by President Obama to the South African government: resolve outstanding issues blocking agricultural imports from the USA or have your duty-free farm trade status with the USA suspended. This is part of AGOA (African Growth and Opportunity Act), a measure first implemented under the Clinton administration to encourage economic growth in Africa.

The Department of Trade & Industry duly calmed the waters, giving assurances that it is on track to meet all eligibility criteria to remain a beneficiary of AGOA for the next 10 years. South Africa has been given six weeks. While it is true that there have been biosecurity reservations to muddy the process (bird flu in two major US poultry-producing states), and while there is indeed a major balancing act to ensure that the country's home industry is not unfairly disadvantaged, we hope that the matter is in better hands than the ones dispensing with water licenses. 

Denmark to provide critical skills transfer and assistance to address SA’s water shortage challenges

Press release

As part of Denmark’s continued and strengthening partnership with South Africa, next week’s (2-4 November) Danish Royal Visit to South Africa will coincide with the signing of a Memorandum of Understanding (MoU) between the country and South Africa’s Ministry of Water and Sanitation which outlines a long term partnership on policy and technology development and knowledge exchange.

His Royal Highness Crown Prince Frederik of Denmark and Danish Minister for Environment and Food, Mrs Eva Kjer Hansen together with South Africa’s Minister for Water and Sanitation, Mrs Nomvula Mokonyane will sign the MoU at the official Grand Opening of the Danish Business Expo to South Africa on Monday, 2 November 2015 at Turbine Hall in Newtown, Johannesburg.

The MoU will be formalised around major current and future challenges in the South Africa’s water supply and the subsequent areas where Denmark can provide strong partnership particularly around policy incentives for water conservation, management practises and water efficient solutions.

According to the Embassy of Denmark in South Africa, the MoU will play an instrumental role in establishing cooperation on all key stakeholders levels in the water sector from Ministerial, Catchment Management Authorities to Water Boards and Municipal.

Comments Ambassador Trine Rask Thygesen of the Embassy of Denmark in South Africa: “The objective of this MoU is to establish a framework for cooperation between South Africa and Denmark in the water sector. This public partnership will also pave the way for private sector companies in both our countries to partner on smart solutions for water resource management.”

“Danish companies are global market leaders when it comes to water efficiency and waste water management. As such, these Danish companies have solutions that match South African needs. Therefore, I believe there is great potential for South African-Danish partnerships in the water sector, which will help alleviate the current challenges and ultimately uplift communities and create jobs and growth in both our countries.”

The MoU between Denmark and South Africa will include:

• Integrated water resources management;
• Water treatment technologies and management;
• Water and resource efficiency;
• Groundwater protection and management;
• Water governance and science;
• Capacity Building and institutional strengthening

This will serve as a platform for long term cooperative relationship on the basis of equity and mutual benefit.

The Royal Visit of Crown Prince Frederik will also coincide with a business promotion consisting of 47 Danish companies spanning three key industry sectors: Energy, Water & Environment and Agriculture & Food.

HRH the Crown Prince, Minister Hansen and Minister for Business and Growth, Mr Troels Lund Poulsen together with the business delegation will visit both Johannesburg and Cape Town; a considerable time will be spent strengthening commercial relations between Denmark and South Africa.

Denmark and South Africa have a longstanding relationship,  and there are several  completed and ongoing activities where Denmark are working together. Several Danish companies working in the water sector has been operating in SA for many years creating solutions and employment, also in terms of export to the region.

The agenda for both Johannesburg and Cape Town offers numerous workshops and networking opportunities for both Danish and South African businesses spanning the three sectors.  Furthermore, the agenda will include:

• Grand Opening addressed by the Crown Prince in Newtown Johannesburg and Grand Dinner in Stellenbosch in the Western Cape
• Whole day water seminar where  water experts from the SA water sector and water experts from the Danish companies will discuss challenges and solutions
• Visit to Soccer City Stadium where Danish company Grundfos has delivered advanced pumping solutions for water distribution and drainage
• Visit to Drankenstein Water Treatment Plant where Danish Water Utility VCS has worked with capacity building on operations optimization; and
• Social Innovation event in Cape Town where young talent will showcase their innovative ideas and entrepreneurship.

For regular updates on the impending Royal Visit go to the Facebook page Embassy of Denmark in Pretoria or follow the Twitter feed #RoyalVisitSA.

Throwing the book at them thar stock thieves

Additional criminal charges are to be laid in terms of the Animals Protection Act against four men arrested on 15 September 2015 who have already been charged with stock theft.

"I was horrified at the photographs in the docket, which clearly show that the animals had been brutally attacked with an axe. Their tendons had been slashed,” said Senior Inspector Andries Venter. "Two knives and an axe were found in the possession of the accused. Over and above the actual theft is the sheer violence, horrific cruelty and the vicious savagery which took place. The suffering of these animals is beyond description.”  

"The term 'stock theft' is misleading. It is horrific animal abuse. It is a violent crime and the public needs to be made aware of exactly what is involved. The suffering of the animals being hacked alive is unimaginable. Their deaths are slow. There is wanton cruelty involved and we are relieved that the authorities are finally recognising this,” stated Venter who confirmed that evidence will be provided to the Prosecutor in support of the State’s application to oppose bail.  

The NSPCA is a member of the National Stock Theft Forum as well as the LivestockWelfare Coordinating Committee (LWCC) and has a direct interest in strengthening the case against the accused by including animal cruelty charges -- and to pursue the same legal route against anyone involved in stock theft. In the past, our judicial system has focused only on the theft angle in the majority of such cases. 

From an NSPCA press release

Stock theft

Stock theft goes further than hamper the profitability of the stock farmer. It also interferes with the Government's land reforming process and the empowering of the emerging farmers. For each stock-theft incident at a commercial farm, three similar incidents take place amongst emerging farmers. What makes it worse is that many emerging farmers suffer a total loss of stock – kraals are literally emptied. These farmers have to resort to other means to care for their families and to make a living.

Throw the book at them thar thieves! 

Find statistics for stock theft on www.redmeatsa.co.za.