Picture: Daily Dispatch
Picture: Daily Dispatch

SA's agricultural industry has welcomed the close to R4bn the government will plough into the sector to benefit black commercial farmers.

President Cyril Ramaphosa announced during the state of the nation address (Sona) on Thursday that over the medium term budget period, R3.9bn has been allocated to the Land Bank to support the farmers.

"We are going to substantially expand the agriculture and agroprocessing sector by supporting key value chains and products, developing new markets and reducing our reliance on agricultural imports," Ramaphosa said.

"We must be a country that can feed itself and that harnesses the latest advances in smart agriculture."

AgriSA deputy executive director Christo van der Rheede said they were happy about the funding Ramaphosa announced.

"We are of the opinion the Land Bank should have been restructured to develop commercial black farmers," he said.

He said the bank played a huge role in developing white commercial farmers in SA.

"What happened after 1994 is that the bank became institutionalised. Part of the bank should be restructured to become an agricultural development agency for black farmers."

Van der Rheede noted that it was important for the Land Bank to work with the private sector to improve and increase the success rate of black commercial farmers as farming was a "risky business".

"Black farmers can get all the finance in the world, but if they don't get the necessary support and extension services, they will struggle."

The funding comes after the industry bled 12,000 jobs during the first quarter of 2019, and during which the GDP declined by 3.2%, or R56bn.

It was also announced recently that the Agbiz/IDC agribusiness confidence index had fallen by two points in the second quarter, to reach 44 — a level suggesting the sector is downbeat about the operating environment, according to Agbiz chief economist Wandile Sihlobo. 

Black farmers in SA are represented by the African Farmers Association of SA, led by president Dr Vuyo Mahlati. Mahlati, who also chairs the presidential advisory panel on land reform and agriculture. Mahlati could not immediately be reached for comment.

Ramaphosa also announced during Sona that the government had received the report of the advisory panel, saying it will now be presented to cabinet for consideration.

"The panel’s recommendations will inform the finalisation of a comprehensive, far-reaching and transformative land reform programme," he said.

"In the immediate term, government will accelerate efforts to identify and release public land that is suitable for smart, urban settlements and for farming."

The advisory panel on land reform and agriculture was appointed in September last year a few months before parliament resolved to pursue a constitutional amendment to allow for the expropriation of land without compensation to redress skewed land ownership patterns.

mkentanel@businesslive.co.za