Table of Contents

1. Overview

The reader will appreciate that ever since the economic and political changes of the 1990s in South Africa, there have been two movements running counter to each (have you ever tried to enter a building that many people were leaving?) On the one hand, thousands of commercial farmers began exiting because the going was tough and they felt that it would be easier to make a living elsewhere. On the other hand, government has wanted to establish thousands of new black farmers.

Small-scale farming is useful and should be supported. Entry levels are lower, machinery and technology is not as sophisticated, and it creates food security for the families who are farming and it allows for economic activity. As pointed out in an article listed under heading 12, agriculture does not have to be the sole source of revenue for the small-scale farming household. “Smallholder livelihoods all over the world do not just consist of farming … So when considering the potential for smallholder farming development, we shouldn’t think about farming viability, but household viability and increasing food sources for very poor rural households.” (Erasmus, 2014

The major challenge for agriculture, and with it the hopes of the country, is the emerging Black commercial farmer. Support here will enable such a farmer to become an active participant in the commercial farming sector. We need our emerging farmers to succeed, not only because of transformation targets, or for righting the dispossession of the past, or for stability and jobs in the rural areas. We need our emerging farmers to succeed because this is the sector from which our food comes. It is possible to be a farmer in the post-deregulation business environment. The 37 000 or so commercial farmers who adapted and who are now among the best in the world prove this to us.

A cause for concern is that these commercial farmers (and farm workers) are getting older, the average age being just over 60 years-old. This is of great concern to the country’s future.  It’s not enough to speak about how the youth should be encouraged to pursue occupations in agriculture if we are not marking out paths for them (Sihlobo, 2017). It is a national issue that farmers are supported, and with them the ones who for no fault of their own are relatively new on the land, or those who are contemplating a career in agriculture. 

 

2. International business environment

There are some 500-million smallholder farmers worldwide and more than two-billion people depend on them for their livelihoods (IFAD, 2015). Small farms produce about 80% of the food consumed in Asia and sub-Saharan Africa. Find "Viewpoint: Smallholders can feed the world" at www.ifad.org 

 

3. African business environment

Agriculture is at the heart of addressing poverty in Africa. Much more than in any other region, agriculture is a major driver of African economies, typically representing 30-40% of GDP and 65-70% of labour force.

It’s true that Africa’s agricultural transformation will be a complex, multi-sectoral agenda that requires different enabling factors, from sufficient financing and the right policies to the implementation of climate-smart agriculture. But it’s also true that success depends on one crucial factor: the engagement of smallholder farmers. Africa’s agricultural transformation will need smallholders to succeed.

Smallholder farmers continue to dominate African agriculture although some countries--for example, Ghana, Tanzania and Zambia--are experiencing a rise of medium-scale farms of between five and 100 hectares as part of the region’s broader economic transformation. Smallholder farmers still control the largest areas for production. They employ 70% of the work force, farm most of the land, and are home to most of the poor – so the most obvious way to make agricultural growth pro-poor is to engage with huge numbers of small farms.

However, smallholder farmers face major challenges today. They are at a major disadvantage in linking to modern value chains because of their low volumes of sales, poor market information and contacts, and limited ability to meet the high standard requirements of many high value markets. Because of their small size and reach, they are perceived to be high cost and high risk farmers by private agrodealers and financial institutions.

So how can people working in the agriculture sector support smallholder farmers?

  1. First, there is need to provide supportive incentives and policy reforms for farmers and agribusinesses. For example, modern inputs and credit remain out of reach for many smallholders. Farmers could benefit from a package of inputs and credit. The issue of land tenure policy reform is critical. Between 10-45% of businesses describe access to land as major constraint. There is need to build institutions that help farmers--including youth and women-- access land and engage in profitable commercial agriculture.
  2. Work also needs to be done on scaling up investments in infrastructure and technology, particular technology that helps farmers produce more food. (i) Neglecting to invest in agricultural research and the creation of many small, underfunded research institutions has caused setbacks that will need to be addressed. (ii) Africa also needs investments to develop agricultural education at all levels. (iii) Finally, Africa’s aging infrastructure cannot launch or sustain internationally competitive commercial agriculture without investment, especially in irrigation, roads, energy, and logistics, especially port infrastructure.
  3. We also need to strengthen institutions to make markets work better for smallholder farmers. Some of these institutions would provide critical services such as access to finance, market intelligence, marketing and business development services—all things that the private sector currently has few incentives to provide. We need to focus on improving coordination and leveraging partnerships among the different key players including but not limited to multilateral and bilateral development finance partners, the private sector, the Consultative Group on International Agricultural Research and African national and regional institutions.

The challenges facing agriculture are great but we have reasons to be optimistic. Agriculture’s value added increased by 5.1% between 2000 and 2013. There’s no limit to what agriculture can achieve—in terms of feeding Africa, creating jobs, and helping to end poverty and boost prosperity. We have to work hard to make sure that smallholder farmers will be part of the work to meet Africa’s growing food and beverage markets –which are expected to top $1 trillion in value by 2030.

Source: Ehiu, S. 2017, October 13. "How can we help smallholder farmers seize opportunities in Africa?" (adapted). Find full citation under heading 12