ICYMI: Zondo releases report on Vrede Dairy Project

A roundup of the biggest happenings in agriculture: Chief Justice Raymond Zondo released the final volumes of his state capture report last night and gave scathing commentary on the Vrede Dairy scandal. Plus, Agri SA sounds the alarm on the impending closure of Tiger Brands' fruit cannery in the Western Cape

Justice Raymond Zondo released the final chapters of his report into state capture last night (Wednesday, 22 June 2022). Photo: Supplied/Food For Mzansi

Justice Raymond Zondo released the final chapters of his report into state capture last night (Wednesday, 22 June 2022). Photo: Supplied/Food For Mzansi

Chief Justice Raymond Zondo released the final volumes of his report on state capture last night (Wednesday, 22 June 2022) and was scathing in laying the blame for the Vrede Dairy scandal before three officials – two of them formerly of the Free State department of agriculture and rural development.

“The whole Vrede Dairy Project happened because Mr [Peter] Thabethe dismally failed to do his job and failed to protect the interests of the [department] and to protect taxpayers’ money. It also happened because Mr Mosebenzi Zwane as MEC was pursuing the agenda of the Guptas and did not do his job to perform oversight over Mr Thabethe. It also happened because the premier of the province, Mr Ace Magashule, would have also been pursuing the agenda of the Guptas,” Zondo said in his report.

Thabete is the former Free State agricultural department head and Zwane the former Free State MEC for agriculture and rural development.

Zondo further made it clear that the local black farmers who had been the intended beneficiaries of the project, were merely used and side-lined in order to channel more than R280 million to Estina, a so-called implementing agent for the dairy project and a company owned by the Gupta family.

“It is necessary that there be consequences for people who fail to do their job,” he wrote. “Otherwise, this corruption and these acts of state capture are going to continue forever to the detriment of the country and all people.”

Thabethe has already been criminally charged, but Zondo recommended that Zwane en Magashule also be further investigated by law enforcement agencies to determine whether they had contravened “any law in the roles they played in regard to the Vrede Project”. He also recommended that civil action be considered against them to recover tax payers’ lost money.

Read the full text of the report below.

Agri SA sounds the alarm on Tiger Brands canning factory

Agri SA yesterday became the latest voice to express concern over the impending closure of Tiger Brands’ canning factory in Ashton in the Western Cape.

On 9 June this year, the food giant gave notice to stakeholders of a 60-day consultation period with the intention of closing down the plant.

But few people realise the real impact that this decision would have on the community, producers, the industry and agro-processing in the Western Cape, Agri SA said in their statement.

“This is a huge concern for Agri SA. The Langeberg and Ashton factory is the biggest in South Africa and one of only two fruit canning factories. The world-class factory plays a vital role in enabling South African canned fruit to occupy the niche position it does in the world market. South Africa is ranked in the top seven canning fruit countries in the world by production, and the factory brings in hundreds of millions of rand in foreign currency.”

Agri SA added that producers have made urgent requests to the Western Cape and national governments to intervene in this matter and Agri SA agrees.

According to the organisation, Tiger Brands initially decided to divest from this factory two years ago. At that point, a consortium of 160 producers began negotiations with Tiger Brands to acquire the factory, but the consortium will require a further R200 to 300 million to close the deal. With the latest announcement from Tiger Brands, these producers have been placed in a nearly impossible situation to secure the necessary funds in less than 60 days. “Without support from government and cooperation from Tiger Brands, the producers’ initiative will fail, and the fallout will be catastrophic.”

The impact on agriculture

The factory’s main sources are cling peaches, Bulida apricots and Bon Chretien pears from 2 250 ha of canning fruit orchards. These orchards have been planted specifically for canning in the Klein-Karoo and the towns of Ashton, Robertson, Bonnievale, Wolseley, Ceres and the Breërivier areas.

“Were the factory to close, approximately 300 farmers would have no alternative market for these fruits as the other fruit canning factory in South Africa, owned by the Rhodes Food Group, is already running at full capacity. These farmers would have to destroy the orchards.”

Agri SA also reports that teams of seasonal workers are sitting at home as producers already stopped pruning after the announcement. In media statements, Tiger Brands indicated that 250 permanent jobs and 4 300 seasonal jobs are affected at the peak of the season.

“The factory is the life support of the Ashton community and without it, the community faces socio-economic disaster. The Langeberg and Ashton factory is also the biggest single source of income for the Langeberg Municipality.”

In addition to factory workers, the facility provides employment for thousands of farmworkers in Ashton and in the production regions. Just over one permanent job opportunity is associated with each hectare of fruit orchard and 2 250 permanent farm workers’ livelihoods are now in jeopardy. Additional seasonal labour is utilised for winter pruning, thinning, summer pruning and harvest.

The canning factory has been in operation for more than 70 years and supplies fruit for Tiger Brands’ KOO brand as well as international brands like Silverleaf and GoldReef. The factory initially consisted of two separate factories owned by the producers and a local entrepreneur. Tiger Brands subsequently bought these factories and consolidated them into one.

“Agri SA is concerned that the closure of the factory would be a socio-economic disaster for the region, with ripple effects throughout the value chain. At a time when job creation and economic growth are desperately needed for the maintenance and recovery of the national economy, the agro-processing sector cannot afford this closure.”

Agri SA says it is essential that Tiger Brands comes to the negotiating table with the producers and workers at its factory to find the best possible solution for all the affected stakeholders. And with the Agriculture and Agro-Processing Masterplan now in place, it is also vital that government take up its role in supporting the growth of this important employer for the Western Cape.

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