A shocking new survey reveals that while 63% of commercial-scale farmers are back to their pre-pandemic operational levels, only 13% of Mzansi’s up-and-coming farmers have managed to bounce back.
This is according to the latest edition of the BeyondCovid Business Survey conducted by specialist management consultancy Redflank.
“Small growers largely rely on sidewalk food stalls and fresh produce markets, as well as direct trade with corner shops, spaza stores, other SMMEs, schools, crèches, and NGOs,” says BeyondCovid co-founder Etienne van Wyk.
“When we went into hard lockdown, with all the restrictions, they lost access to those markets. Because they don’t have the financial buffers large companies have, they were hit severely and are still struggling.”
Major farmer challenges
“What doesn’t help is that many SMME off-takers of emerging farmers have been affected by the pandemic. The BeyondCovid survey has revealed that 54% of all small businesses surveyed were still operating below capacity. This impacts severely on emerging farmers, considering that SMMEs account for half their demand.”
What makes this situation bitter-sweet, is that last year could have been an excellent farming year due to favourable weather conditions, sufficient rainfall, and the fact farming was hailed as one of the essential services.
Ultimately, this affects everyone, says Fay Mukaddam, BeyondCovid chairperson.
“Emerging farmers, like other SMMEs, are important job creators, especially in rural and peri-urban areas where jobs are already scarce. When these ventures struggle, people struggle and with that the government’s social security network.”
Establishing food security
The status quo also has consequences for our country’s food security levels, especially in townships and other vulnerable areas.
Van Wyk adds, “The bulk of the South African population relies on fruit, vegetables, and other products produced and sold by emerging farmers, such as sidewalk stalls and fresh produce markets. If small farmers suffer, then their customers suffer, too.”
These and other issues were highlighted during BeyondCovid’s recent Making Emerging Farmers Bankable summit. A key solution that was discussed involved organising up-and-coming farmers and established agriculture corporations in so-called SMME Collectives.
These structures are based on similar and tried-and-tested enterprise development models funded by organisations such as the National Treasury’s Jobs Fund and the World Bank.
“They are a win-win situation for everyone. Smaller farmers win because these structures provide them with a sustainable market, thus more income,” explains Van Wyk.
“Poor access to markets and funding are key problems SMMEs face. The agricultural corporates (co-ops) benefit in the form of a steady supply of different products, meaning they can service larger markets and more customers.”
Another major advantage for new era farmers is that being aligned with large export corporations helps them become export-ready, allowing them to sell their products overseas.