New markets, water security and access to finance took centre stage on day two of Nampo Cape in Bredasdorp, where Food For Mzansi and Land Bank hosted a lunchtime conversation on the growth of Western Cape agriculture.
The conversation brought together a panel that included Sakhumzi May, chief agricultural economist at Land Bank; Matyana Mzi, regional head of commercial banking and transformation for the Cape region at Land Bank; Jannie Strydom, CEO of Agri Western Cape; and Aldrink October, a farmer at Kaapschon Boerdery & Ander.
May explained the growth opportunities in the provincial agricultural sector despite the prospect of another El Niño, as well as the potential presented by new markets.
“If you look at the Western Cape, it’s positioned in a place where there is infrastructure already. The ports are here. But we need to create some efficiencies. So, you will find that there are markets that have been secured, so there are opportunities for growth.
“And this opportunity for growth, I think, requires both participants from the commercial side as well as the developmental side. So that we find ways of bringing development finance. And what is key is that, as there is growth potential, it means that we need to grab it. We’ve got new markets like China that have been opened up.”
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Water challenges in the Western Cape
May also pointed to the potential to capture more water following periods of heavy rainfall and flooding in the province.
“If you look at the Western Cape, particularly with a lot of floods that are taking place, it means there’s more runoff water that is there. If we build infrastructure capacity for water to reserve and collect that water, it will benefit irrigation. We can expand irrigation hectares to take up the market that is there,” he said.
October highlighted the importance of access to water and the challenges involved in transferring it between different parts of a farm.
“I have a big dam on the wine farm; on the other farm, I have the small dam. I have winter water and summer water.”
He said the summer dam was located at the bottom of his Overberg farm and needed to supply water to the upper part of the farm. The estimated cost of transferring the water was around R250 000, but he had to invest to survive the season.
Meanwhile, Mzi highlighted the importance of banks acting as trusted advisers by understanding farmers’ backgrounds, plans and needs.
“Once we become a trusted adviser to the farmer, they give us an opportunity as a bank to understand their background, what motivated them to be in this space, what the current challenges are that they are facing, and what their future plans are in terms of expansion.
“And then that gives us an opportunity to provide a solution to them according to their needs,” he said.
However, Strydom said farmers needed to remain positive and have hope for the next season, highlighting the resilience of farmers who continue to produce food despite the many challenges facing the sector.
He also pointed to a few key commodities that could have an interesting future in the sector, including the wine industry.
“The grain industry is really coming under severe pressure at this stage. I think we all know it by now, and something has to happen. We all know the challenges.
“There will have to be some structural change: the time structure, the pricing, the whole transport differential, all of that. But something needs to happen now. Otherwise, we are going to lose regions in terms of grain production,” Strydom said.
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