Prof Ferdi Meyer
Mail & Guardian
28 March 2019,Johannesburg
University of Pretoria
&
Bureau for Food and Agricultural Policy
Land Reform:
Foresight – preparing for
certainties and
uncertainties
BFAP Baseline 2018
SA’s performance in the global economy
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
China USA Russia Mexico Colombia Australia RSA Chile
% c
han
ge p
.a. 2
00
6 -
20
16
Real AG GDP growth:2006 - 2016
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
0
10
20
30
40
50
60
2000 2003 2006 2009 2012 2015 2018 2021 2024 2027
R b
illio
n (
real
20
00
)
% change real Ag GDP Real Agricultural GDP
Agricultural GDP in South AfricaAI, Listeria, WC Drought,High grain stocks
NDP targets – Score sheet
NDP Target Indicator
Land reform No
Jobs & growth:High value crops
Yes
Jobs & growth:Under-utilised land, homelands etc.
No
Jobs & growthAgro –processing
Yes
Irrigation expansion of 142 000 ha NOT 500 000 ha
BFAP Baseline 2018
High-growth industries are on track
BFAP Baseline 2018
• SA a net exporter of agricultural products
• Horticulture leading export performance – rapid growth in Citrus exports, nuts, wool
• Significant imports: rice, poultry, palm oil, wheat
Export performance on track
02468
101214161820
Cit
rus
Gra
pes
Win
e
Po
mef
ruit
Mai
ze
Nu
ts
Wo
ol
Spir
its
& L
iqu
or
etc.
Ber
rie
s an
d S
ton
efr
uit
Bo
vin
e M
eat
Oth
er
Ban
anas
Co
tto
n
Pig
Me
at
Co
ffee
Soya
oil
& c
ake
Suga
r
Wh
eat
Pal
m O
il
Po
ult
ry M
eat
Ric
e
Net Exporters Net Importers
Bill
ion
ZA
R
2015 2016 2017 2016 20172015
Market access for South African productsSouthAfrica
Australia New Zealand Peru Chile Argentina Uruguay
China Bilateral Bilateral Bilateral Bilateral
Hong Kong (China) Bilateral
India SACU(Plurilateral)
GSTP BilateralGSTP
GSTPMercosur-IndiaBilateral
GSTPMercosur-IndiaBilateral
Indonesia ASEAN-Australia-New Zealand
ASEAN-Australia-New Zealand
GSTP GSTP GSTP
Japan Bilateral Bilateral Bilateral
South Korea Bilateral BilateralGSTPPTN
BilateralGSTPPTN
GSTP PTN
Malaysia BilateralASEAN-Australia-New Zealand
BilateralASEAN-Australia-New Zealand
GSTP BilateralGSTP
GSTP
Philippines ASEAN-Australia-New Zealand
ASEAN-Australia-New Zealand
GSTPPTN
GSTPPTN
GSTP PTN
Thailand BilateralASEAN-Australia-New Zealand
BilateralASEAN-Australia-New Zealand
GSTP GSTP GSTP
Vietnam ASEAN-Australia-New Zealand
BilateralASEAN-Australia-New Zealand
GSTP Bilateral GSTP
SACU: Southern African Customs Union
GSTP: Global System of Trade Preferences among developing countries
PTN: Protocol on Trade Negotiation
Source: SHAFFE, 2018
Major investments in Ag-processing on track
0
500
1000
1500
2000
2500
Tho
usa
nd
to
nn
es
Soybean crush Soybean full fat
Benchmark crush capacity (2.2 Million tonnes)(80% Utilisation of dedicated soya and dual capacity)
Benchmark crush capacity (1.70 Million tonnes)(80% Utilisation of dedicated soya capacity
Land-reform & farmer support not on track
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
WC EC NC FS KzN NW GA MP LP
Agric GVA share versus Gov spending share
GVA share Gov spending share
• DAFF spends R11 billion per annum
• Strong focus on smallholder farmer, but support programmes lack coordination, focus, effective management etc.
Inclusive economy
Concentrated economy
Extension of strong property rights
Weak protection of property rights
Current
Preferred
Will eventually migrate due to
societal uprising
(5-10 years)
2: Dis-investment(0-5 years)
4: Equitable and stable growth
3: Status quo; gradual decline1: Chaos …..
High risk sliding down (post 5
years)
Land reform scenario matrix
• What is needed to move from 3 to 4?• Key messages and implications to
quadrant players
Natural Resource Base & taking stock
11 |
Source: ARC-ISCW (2004)
• SA total area: 122 million
• Agricultural land: 93 million• Freehold: 77 mil ha
• Former homelands: 15.5 mill ha (50 000 irrigation)
• Land already transferred to state or people of colour: 11.44 million.
• 66 million ha in white ownership
• 3.9 million ha owned by state and municipalities
• 1.26 Trancraa lands
Land categories based on natural resources
12 |
Catergory of land based natural resource base
Extensive pastures
Intensive pastures
Extensive field crops
Intensive field crops
Orchards andvegetables
Land Reform: One size does NOT fit all!
-
20.0
40.0
60.0
80.0
100.0
120.0
140.0
160.0
180.0
-
100.0
200.0
300.0
400.0
500.0
600.0
700.0
800.0
900.0
Extensive livestock Grains&Oilseeds(Dryland)
Grains&Oilseeds(irrigation)
Vegetables(Tomatoes etc.)
Orchards (Orangesetc.)
Gro
ss M
argi
n R
'00
0/h
a
CA
PEX
& O
PEX
; R
'00
0/h
a
Net revenue per hectare (National 5-year averages)
CAPEX OPEX Gross Margins
Farm size
Food security - portfolio approach critical
Platform towards integrated support
Select LayersZoom In
36%
6%14%
37%
3%
Salaries
Business
Remittances
Pension
Grants
Farming
Other
No income
Unspecified
Farming as a source of income
41%
32%
27%
Pension and grants
Farming
Other
StatsSA 2015 Household survey 2016/17 Jobs Fund – Targeted supportprogrammes for developing farmers
Maize consumption & marketingWhere farmers sold their 2016/17 grainShare of harvest consumed in the household
44%
34%
14%
6%
2%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
To acommercialmill or coop
In thecommunity
Toneighbours
Other At pensiondays
Sh
are
of
Resp
on
den
ts
9%
26%
44%
8%
4%
9%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Sh
are
of
Resp
on
den
ts
Spatial Targeting: 300 000 ton market
18 |
Spatial Targeting: Emerging farmers & households
19 |
Land-use Competition
20 | Source: BFAP (2015)
Transformation in SA is about:
- The people
- The economy
- The environment
THANK YOU
