PRESENTATION OF THE ANNUAL REPORT OF THE
NATIONAL AGRICULTURAL MARKETING COUNCILTO
THE PORTFOLIO COMMITTEE12 NOVEMBER 2004
BY
Mr MG Rathogwa – Chairperson Ms D. Ndaba – Council member
Mr V.W. Mvabaza – Council member
LEGISLATIVE MANDATE
The NAMC was established in terms of sections 3 and 4 of the Marketing of Agricultural Products Act, No. 47 of 1996 (hereinafter referred to as the Act) as amended by Act No. 59 of 1997 and Act No. 52 of 2001. The mandate of the NAMC is spelled out in section 9(1)(a) of the Act, which reads as follows: The NAMC shall, when requested by the Minister or of its own accord, investigate the establishment, continuation, amendment or revocation of statutory measures and other regulatory measures affecting the marketing of agricultural products, evaluating the desirability, necessity or efficiency of the measures and, if necessary, proposing alternatives to the establishment, continuation, amendment or repeal of a statutory measure or other regulatory measure and report to and advise the Minister accordingly.
Furthermore, section 9(1)(e) of the Act stipulates that the NAMC may undertake investigations and advise the Minister regarding: •agricultural marketing policy and its application;•the coordination of agricultural marketing policy in relation to national economic, social and development policies and international trends and developments; •the possibilities for promoting the objectives of the Act, mentioned in section 2(2) of the Act; and•the effect that marketing of products has on the objectives mentioned in section 2(2) of the Act.
In addition, in terms of section 9(1)(f) of the Act, the NAMC shall monitor the application of statutory measures and report thereon to the Minister and shall review such measures at least every two years.
RELEVANCE OF THE NAMC IN THE DEREGULATED MARKETING ENVIRONMENT:
1. Globalization is taking place at a faster pace and this demands
provision of timeous, accurate and relevant information to participants.
2. The second economy needs more support, more especially in marketing information, which is the key to business operations.
3. Demand for government intervention in terms of statutory levies is increasing. This needs a dedicated institution to investigate application and monitor implementation.
4. Looking “outside” the country, many countries have dedicated marketing institutions to promote their agricultural products.
5. In a sector such as agriculture you need an institution, which has the
necessary capacity and experience to advise government on various policies and strategies. This is provided for in the Act in terms of categories in which members of the Council are appointed.
NAMC ACTIVITIES FOR 2004/05 IN LINE WITH THE STATE OF THE NATION ADDRESS BY THE PRESIDENT ON 21 MAY 2004
Encouraging the growth and development of the first economy and increasing its possibility to create jobs The NAMC investigates, advises and monitors the implementation of statutory measures in the agricultural sector. These measures relate to the registration of role-players, rendering of records and returns and collection of levies. These actions support gathering and distribution of information, and provide resources for agricultural research and development. These are fundamental to agricultural sustainability for both commercial and emerging sectors of the two economies. In addition, the NAMC ensures that over and above research and information, 10% of the funds collected from role-players is used for specific emerging sector development projects.
Increase support to agricultural activities The NAMC conducts investigations together with role-players in order to address problems in agricultural marketing and also to identify opportunities. The information coming out of these investigations is useful for both commercial and emerging sectors for devising strategies to take advantage of opportunities and sort out bottlenecks. In addition the NAMC is going to investigate how the different policies that have been passed in agriculture impact on agricultural development. The aim is to advise on how these policies can best be coordinated so that they complement one another. This will also ensure effective co-operative governance between the implementing bodies of government and other agencies.
Increase support to agricultural activities in emerging sector NAMC will provide marketing information to emerging
farmers by holding 36 workshops nationally. The target is to reach 3600 farmers and distribute information booklets. In this way emerging farmers will be:
- more market oriented in their farming activities;- connected with organized agriculture and will thus be more
informed about agricultural marketing issues;- assisted to identify potential markets and how to access
them.
Contribution to the conclusion of the WTO negotiations
NAMC is conducting a study on international agricultural Support and Competitiveness and this is to be finalized by July 2004.
Information emanating from this study will be used at WTO negotiations where South African negotiators will have specific information about levels of government support to farmers in different countries. The information will also be used by commercial and emerging farmers in their interaction with government and other investors.
MISSION STATEMENT
To provide strategic advice to the Minister of Agriculture and directly affected groups (DAGs) on all agricultural marketing issues in the agriculture and food industries, taking into account the needs of stakeholders.
To be the most efficient and effective marketing advisor in the marketing of agricultural products in South Africa.
VISION
CORE BUSINESS
CORE VALUES
Provide accurate, relevant, independent and timely information.
To be accountable, to act with integrity, to value individual performance, to value personal respect and equal treatment,
to act in partnership with directly affected groups.
Organisational structure of the NAMC
Economists (2)
Communication Officer (Vacant)
Audit Committee
Finance Clerk
Chairperson
Chief Financial Officer
Section HeadField Crops
Economists (3)
Cleaner (Vacant)
Secretary
Registry Clerk
Personnel Officer(Vacant)
Finance Officer
Economists (2)
Section HeadLivestock
Section HeadHorticulture
Bookkeeper (Vacant)
Section Head Administration
Messenger/Driver
Secretary
Council
The activities of the NAMC were informed by:
- The Marketing of Agricultural Products Act, No 47 of 1996.- The Agricultural Sector Strategic Plan. - State of the Nation Address- Minister’s Budget Speech
2003/04 BUDGET UTILIZATION
Council Meetings (including Executive Committee meetings)
Committee Meetings of Council
UTILISATION OF 2003/04 NAMC BUDGET
INCOME R 10 422 411 Made up of: Transfer from DoA R 10 109 000 Interest and other R 313 411
ACTUAL EXPENDITURE R 9 664 203
Made up of: Personnel expenditure R 5 096 234 Administration R 2 177 529 Professional services R 2 424 049 Provision for audit fees R (33 609) Surplus R 758 208
OUTPUTS AND SERVICE DELIVERY TRENDS – COUNCIL Sub-programmes
Outputs Indicator Performance
Council
Agenda items Expected number
Actual number
Council sittings 11 11Presentations by delegates 10 13
Submissions to the Minister 45 51Ministerial enquiries 50 62Executive Committee meetings
4 3
Management Committee meetings
45 42
WORKSHOPS HELD WITH BLACK FARMERS
Province Total workshops
Actual workshops
Farmer attendance
Average attendance
Eastern CapeFree StateGauteng KwaZulu-NatalLimpopoMpumalangaNorthern CapeNorth WestWestern Cape
555555555
551855-37
306425134562382358
-216174
6185
134707671-
7224
TOTAL 45 39 2 557 65
Name of Control Board Date scheme repealed
1. Canning Fruit Board 30 September 1997
2. Cotton Board 5 January 1998
3. Dried Fruit Board 31 December 1998
4. Lucerne Seed Board 30 August 1997
5. Milk Board 5 January 1998
6. Mohair Board 31 December 1997
7. Oilseeds Board 31 March 1998
8. Sorghum Board 30 September 1997
9. Citrus Board 31 October 2003
10. Deciduous Fruit Board 31 October 2003
11. Wheat Board 31 July 2003
FORMER CONTROL BOARDS AND DATES OF DISBANDMENT
CONTROL BOARDS STILL IN EXISTENCE AS AT 31 MARCH 2004
Name of entity Number of extensions
granted
Reasons for continued existence
Meat Board 6 months to Dec 98
7 months to July 99
12 months to Jul 00
12 months to Jul 01
12 months to Jul 02
12 months to Jul 03
12 months to Jul 04
The only remaining issue is the court case regarding medical benefits between the Meat Board and ex-employees on the one side and a medical scheme on the other. In February 2004 the Board indicated that this matter had been resolved and that the Scheme could be repealed by 31 July 2004.
CONTROL BOARDS STILL IN EXISTENCE AS AT 31 MARCH 2004
Name of entity Number of extensions
granted
Reasons for continued existence
Maize Board 6 months to Jun 98
6 months to Dec 98
7 months to Jul 99
12 months to Jul 00
12 months to Jul 01
12 months to Jul 02
12 months to Jul 03
12 months to Jul 04
Outstanding issues include the transfer of trademarks to the Maize Trust and court cases relating to the collection of outstanding levies.
Name of entity Number of extensions
granted
Reasons for continued existence
Wool Board 6 months to Jun 98
6 months to Dec 98
7 months to Jul 99
12 months to Jul 00
12 months to Jul 01
12 months to Jul 02
18 months to Dec 03
12 months to Jul 04
The Wool Board reached a settlement with its Australian counterparts regarding its share of the intellectual value of the “Woolmark”. The Board also decided to write off all outstanding debts. It is envisaged that it will not be necessary to extend the Wool Scheme for another period.
CONTROL BOARDS STILL IN EXISTENCE AS AT 31 MARCH 2004
OUTPUTS AND SERVICE DELIVERY TRENDS - ADMINISTRATION Sub-programmes Outputs
Service delivery indicatorsActual performance
PFMA
requirements
Internal auditingThe PFMA requires for internal
auditing to be done.
Internal auditing was done during
the 2003/04 financial year.
Audit Committee Committee has to convene twice
in a financial year.
The Committee met four times
during the year under review.
Obtaining 2003/04
budget approval
The NAMC’s business plan and
budget had to be submitted for
approval by February 2003.
Business plan and budget were
submitted as required by the
PFMA.
Human
resources
Review of service
conditions
The NAMC set itself the target of
finalising and adopting the reviewed
service conditions.
Final draft of the reviewed service
conditions was available but not
adopted at year end
Staff evaluations
The target was to evaluate staff
three times during the financial
year.
Staff were evaluated twice in the
year under review.
OUTPUTS AND SERVICE DELIVERY TRENDS -HORTICULTURE
Sub-programmes Outputs Service delivery
indicators
Actual performance
Application for the implementation of new four-year period of statutory measures for Deciduous Fruit (pome and stone fruit), amendment of statutory measures on export wine, and implementation of a new four-year period of statutory measures in the Citrus Industry
Investigation regarding the application for implementation of new four-year period of statutory measures for Deciduous Fruit (pome and stone fruit), was completed and report compiled.
Delivery of report to the Minister.
Submission sent to the Minister.
Investigation regarding the application for amendment of statutory measures on export wine completed and report compiled.
Delivery of report to the Minister.
Submission sent to the Minister.
Investigation regarding the application for implementation of a new four-year period of statutory measures in the Citrus Industry
Delivery of report to the Minister.
Investigation to be completed in the next financial year.
Citrus and Deciduous Fruit Industry Trust
Reports (submissions) advising the Minister on the expiry of terms of Ministerial trustees were compiled.
Reports (submissions) on the appointment of Ministerial trustees were delivered to the Minister.
Submission on appointment of trustees forwarded to the Minister.
OUTPUTS AND SERVICE DELIVERY TRENDS - FIELD CROPS
Sub-programmes Outputs Service delivery indicators
Actual performance
Maize Board A submission on the sale of the Maize Board building was compiled.
Delivery of submission to the Minister.
The Minister approved submission on 17 December 2003.
Maize Trust A submission on the proposed amendments to the Maize Trust Deed was compiled.
Delivery of submission to the Minister.
The Minister approved the submission on 24 January 2004.
Winter Cereal Trust
A submission on the utilisation of unused levies at the end of the levy period was compiled.
Delivery of submission to the Minister.
The Minister approved the submission on 1 October 2003.
Amendments to statutory measures(maize, winter cereals, sorghum and oilseeds)
Investigation of the application for the amendments to statutory measures relating to registration, records and returns for maize, winter cereals, sorghum and oilseeds was carried out.
Delivery of submission and Notices to the Minister.
Submission approved by Minister and measures amended on 11 August 2003.
New statutory measures for whole maize and wheat
Investigation of the application for new statutory measures relating to weekly records and returns for imports and exports of whole maize and wheat was carried out.
Delivery of Working Group Report, submission and Notices to the Minister.
Submission approved by Minister and measures implemented in March 2004.
Continuation of statutory measures on grains
Investigation of the application for the continuation of statutory measures relating to registration, records and returns for maize, winter cereals, sorghum and oilseeds was carried out.
Delivery of Working Group Report, submission and Notices to the Minister.
Submission approved by Minister and measures extended by four years in February 2004.
New statutory measures on lucerne
Investigation of the application for new statutory measures relating to registration, records and returns for lucerne was completed and report compiled.
Delivery of Working Group report, submission and Notices to the Minister.
Submission approved by the Minister and the new statutory measures were implemented in January 2004.
Statutory levy on cotton
Investigation of the application for new statutory levy on cotton was completed and report compiled.
Delivery of Working Group report, submission and Notices to the Minister.
Submission approved by the Minister and measures implemented in March 2004.
Sorghum Trust, Oil and Protein Seeds Development Trust, Winter Cereal Trust, and Maize Trust
Submissions were compiled advising the Minister on the expiry of the terms of office of Ministerial Trustees.
Submissions on the appointment of Ministerial Trustees were delivered to Minister.
The Minister confirmed the appointment of six Winter Cereal Ministerial Trustees on 11 July 2003 and a Cotton Ministerial Trustee on 1 August 2003.The appointment of Ministerial Trustees for the Sorghum Trust and Oil and Protein Seeds Development Trust is still pending.
Food Price Monitoring Committee
- Six monitoring points in each Province
- Monitors work in collaboration with Provincial Departments of Agriculture
- Collect food price data and forward to NAMC for processing and analysis
OUTPUTS AND SERVICE DELIVERY TRENDS - LIVESTOCK
Sub-programmes Outputs Service delivery indicators Actual performance
Meat Board Submissions to the Minister.Consultation with the industry regarding outstanding issue.
Submission of the Board’s budget and the extension of the Meat Scheme to the Minister.Industry consultation.
Budget submission received from the Meat Board on 2 February 2004. Submission was receiving attention by the end of March 2004.
Wool Board
Submissions to the Minister.Engaging the industry regarding outstanding issues.
Submission of the Board’s budget and the extension of the Wool Scheme to the Minister.Meetings with industry.
Budget submission received from the Wool Board on 13 January 2004. Submission was receiving attention by the end of March 2004.
Applica-tion for new statutory measures (milk industry)
Working group investigated the proposed statutory measures (registration of milk producers and the furnishing of records and returns by milk producers). Investigation completed and report submitted to Minister.
Completion of the NAMC investigation within 60 days of the date on which the Minister referred the application to the NAMC.
Investigation was completed and forwarded to Minister. The Minister granted approval on 27 July 2003. Notices promulgating the statutory measures were published in the Government Gazette on 15 August 2003.
Applica-tion for new statutory measures (dairy industry)
Working group investigated the proposed statutory measures (levies, registration of secondary role-players and the submission of records and returns). Investigation completed and report submitted to Minister.
Completion of NAMC investigation and extension of the date (60 days) by which the NAMC had to report back to Minister was requested.
Investigation was completed and forwarded to Minister. The Minister granted approval on 26 November 2003. Notices promulgating the statutory measures were published in the Government Gazette on 19 December 2003.
Applica-tion for new statutory measures (red meat industry)
Working group was appointed to investigate the proposed statutory measures (levies, registration of secondary role-players and the submission of records and returns) in the red meat industry.
NAMC to investigate the application for statutory measures within 60 days (or longer period as may be approved by the Minister) after the Minister referred it to the Council.
The investigation was not completed within 60 days after it was referred to the Council. The Council requested and was granted extension. The investigation was still pending by the end of March 2004.
OTHER PROJECTS AND INVESTIGATIONSProject Focus Impact/ Results
Ostrich To study the impact of deregulation on the ostrich industry and to Investigate the industry as there was little information on the industry.
Challenges affecting market access to foreign countries became more apparent to Government and the industry became more accessible.
Poultry Study production and marketing arrangements by black farmers.
Fourth Chamber at the South African Poultry Association has been established to look at the interest of small farmers.
Section 7 Committee on transformation
To investigate the current status of the participation of black role players in the agricultural marketing chain.
Gaps in the transformation have been identified.
Maize Section 7 Study
Report was referred to other important role players for their comments on recommendations that affect them.
Report distributed to all role players. Being used to address problems in the industry.
Consumer issues
Food Price Monitoring Committee Report finalised by December 2003. food Price Monitoring Programme established.
Recommendations accepted by Parliament. There is more awareness of food prices and food price monitoring points are to be expanded.
Grain trading study
A study on the trading of grain by black role-players were completed during the year under review.
Government intervention is necessary to establish accurate and reliable market information with regard to the emerging sector. More black emerging producers and traders should collaborate with the Crop Estimates Committee to be able to include small-scale grain production in national crop figures projects towards developing black farming and trading.
Crop Estimates Liaison Committee
The monitoring of the performance of the NCEC is an ongoing function and is undertaken by the ‘market’ using the crop estimates.
A completely independent and objective National Crop Estimates Committee (NCEC), free of commercial bias, was established. Progress was made on the understanding and acceptance of the NCEC by the industry. The committee met twice during the year under review.
