For our farmers – a very important summit reminder

TLU SA Economic Sustainability Summit – 16 July 2019

Commercial farmers have these past few years been under tremendous financial pressure because of circumstances out of their control. This has led to many South African farmers not having the necessary capacity to overcome a crisis on their own. The survival of the agricultural value chain is reliant on sustainable agricultural production and commercial farmers. Obviously, each commodity involved in the production process will have its own unique way of handling the risk.

In practice, we have seen that government – for whichever reason – does not support commercial farmers at all during disasters. That leads to the sector having to be dependent on ourselves to make sure the value chain is kept alive.

TLU SA started sharing ideas with role-players in the value chain on the possibility of viewing the risk in agriculture from a different perspective, since October last year. Various ideas have come to the table and should be explored further.

Use a grain farmer as an example:
The grain farmer has to now offer his farm as collateral to receive the needed financing to be able to afford the production cost. The suppliers of these products – seed, fertiliser, fuel and chemical products – still receive their money, or can depend on the farmer’s land in the event of crop failure.

When the farmer – for whichever reason – cannot afford the input cost for a new season, he will in terms of the Credit Act not be in a position to get support. The production unit will then be under pressure.

When a new farmer then replaces the initial farmer, there is no guarantee that he will have success.

It is in the interest of all role-players in the value chain, as well as rural communities to keep our farmers in production.

TLU SA’s Committee on Economic Sustainability invites role-players in the agricultural value chain to attend an Economic Sustainability Summit on 16 July between 9:00 and 12:00.

TLU SA will present a few models on how to spread the risk with role-players, after which there will be the opportunity to discuss suggestions on how to better these models in order to save the farmer and the value chain.

All role-players are invited to attend this summit:
Date:               Tuesday, 16 July 2019
Time:               9:00 to 12:00
Venue:             TLU SA Head Office, 194 James Drive, Silverton
RSVP:             By email to sekretaresse@tlu.co.za