Milk South Africa has made huge strides in transforming the industry using statutory levies and the Jobs Fund. Interestingly, their interventions evolved from a research piece of work.
My contemporary’s Mkhabela and Ntombela did a research study arguing for increased expenditure on agricultural research. This is staring to show in the transformation agenda that is financed by the industry levies in the milk industry. Mkhabela and Ntombela’s work is so important in that in that it stress the importance of research an intervention as a strategic intervention. The sectors prospects of prosperity depend, among other things, on increased agricultural research expenditure and the reality of declining budgets calls for huge concerns. Let me use the milk industry strides of wonderful transformation work done originating from a piece of research work that was done through the collaboration of Milk South Africa, Nestle SA and the NAMC. The ARC because of its proximity to farmers has been playing a crucial role in the testing of milk of these farmers.
The milk industry as a user of statutory measures is doing great work that is helping the country to fulfil its food security objective. The work of ensuring that the industry is profitable, internationally competitive and sustainable in an ethical way is a work that the industry needs to be commended for doing. One of the conditions of approval for the statutory levy is the use of 20% on transformation which is the focus of this piece. Milk South Africa has had differences with the NAMC on a number of proposed interventions that were ultimately resolved. I must outline from the onset that Milk South Africa is developing black farmers in a way that is sustainable and creating a new calibre of black commercial milk farmers. Without discounting the importance of other pillars of transformation the one on enterprise development when well planned and executed excites because you see farmers developing from humble beginnings.
The issue of capacitating farmers who are running their owned business increases the rate of returns to transformation expenditure. The history of South Africa’s agriculture is one of two sectors that are operating in one country. To bridge the gap will take time and more importantly wisdom that is not commonly found. The commercial side is comparable to the best in the world while the small/communal side comparable to the struggling in the world. Since the dawn of democracy there have been attempts to help the small/communal to develop to commercial level while helping the commercial to strive and develop further. The development and growth of the commercial side can be seen through the increases in the gross value of production with a small contribution from the small/communal.
Positives that were identified
There are many positives in the relationship between Milk South Africa and the beneficiaries of its transformation expenditure. All the farmers we visited appreciated the assistance and outlined
- The off-take agreement features of the approach,
- Infrastructure support ranging from upgrading of milking parlours and electricity,
- The fodder flow, and animal health aspect,
- The flexibility to purchase farm inputs in ensuring the success of the ventures, and
- The selection criteria that seem to get the best.
The challenges that were raised:
- Infrastructure upgrades: one of the hindrances of milk productions development in small farmers is lack of supporting infrastructure,
- Pasture management and fodder management: farm records are very clear that most of these farmers get the best from their cows during the summer months when conditions are good and that changes in winter due in the main to issue of nutrition, and
- Access to veterinary services: there are still challenges of farmers accessing veterinary services that are much needed in ensuring the health of the cows. It appears that in some parts farmers struggle with even testing of their milk.
A well-planned transformation plan that is supported by an existing market state to succeed. Provincial governments prove to play a crucial role in speeding up the successes of such industry transformation. Milk South Africa’s transformation models is a great model of enterprise development. Work with dedicated women and men and develop them from humble beginnings into sizeable farmers on commercial scale.
Disclaimer: The views and opinions expressed in this article are those of the author. They do not purport to reflect the opinions or views of Mzansi Agriculture Talk or its members.