Small farmers on edge over Tiger Brands tribulations

Mzansi's largest food manufacturer has actively invested in supporting black small-scale farmers in recent years, but it recorded profit losses of 10% in the last year

Some of the many farmers currently supported by Tiger Brands. Photo: Regency Global / SA INC

Some of the many farmers currently supported by Tiger Brands. Photo: Regency Global/SA INC

A wage strike by workers at the Tiger Brands snacks and treats division in KwaZulu-Natal is the latest of a series of challenges the company has had to face this year. Fears are mounting that the manufacturing giant’s tribulations could start to impact smallholder farmers supplying them.

The strike follows a wage negotiation deadlock between Tiger Brands and the African Meat Industry and Allied Trade Union (Amitu) last week.

“We have 1 200 members who are on strike,” says the union’s national coordinator, Lungelo Makhathini. “We have made two proposals on our demands, which is an 8% increase, and a revised one which was 7%,” he tells Food For Mzansi.

He says they are willing to go back to the negotiations table to end the strike that has affected the day-to-day operations at the facility, and hopes that Tiger Brands will move from its 4% offer to meet the union’s demands.

Amitu also wants workers who are currently hired as temporary staff to be appointed on a permanent basis. According to Makhathini, more than 300 of the staff members are temporary workers.

“Some of our members have been working for this company for over 20 years and they are still not being hired permanently,” Makhathini says.

Hard hit by product recalls, unrest

Tiger Brands, owner of brands such as Koo, Purity and Jungle Oats, is South Africa’s largest food manufacturer and recently reported its financial results for the year ending September 2021. It included a drop in headline earnings and operating profit.

Profit losses were largely because of the recall of 20 million Koo and Hugo canned products, as well as the civil unrest in KwaZulu-Natal and Gauteng in July this year. The company says this cost them R732 million.

Operating income (profit) fell by 10% to R2,2 billion.

In recent years, Tiger Brands has actively invested in supporting black small-scale farmers with market access, among others.

Busi Sibeko is an economist at the Institute for Economic Justice (IEJ) in Johannesburg. Photo: Supplied/IEJ

A researcher and economist at the Institute for Economic Justice, Busi Sibeko, says that the industrial strike is only adding to the company’s financial challenges. “It is, without a doubt, that small farmers will be negatively affected by the industrial strike taking place. Hopefully it ends soon.

“The information that is surfacing is that the institution might close some of its doors, or that its demises… will lead to job losses, which is something that the country does not need.”

Sibeko says it is important that all parties involved come to the table as the sector is already fragile, and emerging farmers were to be hit hard if closures do take place.

The negotiations between Tiger Brands and Amitu are set to resume on Friday following the collapse in talks between the two parties.

“We are hoping that, through the CCMA, a deal can be reached to end the strike,” Makhathini says. “But at this moment the industrial action continues. We are hopeful that we will meet on Friday. We are ready anytime to talk to them.”

Food For Mzansi tried to get comment from Tiger Brands on the ongoing strike, but is still awaiting a response at the time of publication.

Still supporting black farmers

Tiger Brands CEO Noel Doyle. Photo: Supplied/Food For Mzansi

Despite recording the losses, CEO Noel Doyle says that, through its agriculture aggregator model, the company further increased the number of black smallholder farmers participating in its value chain.

The company successfully added two black female-owned aggregators to its enterprise supplier development programme and expanded the number of farmers supported to 157.

“Projects to the value of R28,6 million were approved in the last year, with a total of eight black aggregators cultivating white beans, wheat, groundnuts and tomatoes.”

ALSO READ: KOO recall: No, you really can’t eat defective products

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