SECTOR ANALYSIS

AGRICULTURE
June 2010
Prepared for submission to the

Department of
Higher Education and Training
by

AgriSETA

June2010

Table of contents
SECTION1:
THEAGRICULTURALLANDSCAPE................................................................................1
1.1
SizeandshapeoftheAgriculturalsector.................................................................................1
Overview............................................................................................................................................1
Distributionofagriculturalproduction.............................................................................................3
ThestructureoftheagriculturesectorinSouthAfrica...................................................................6
Categoriesoffarmingenterprises....................................................................................................8
Employmenttrends...........................................................................................................................9
Employmentcategoriesandremuneration...................................................................................11
StakeholdersintheAgriculturalsector..........................................................................................13
Nationalgovernmentdepartments...........................................................................................13
Sectorrepresentatives................................................................................................................14
1.2
FactorsimpactingdevelopmentintheAgriculturesector...................................................15
Futuresectoreconomicgrowthanddevelopment.......................................................................16
SouthAfricansectorgrowthplans(IPAP2)................................................................................16
InternationalTrade......................................................................................................................16
Globalrecessionandriseinfoodprices.....................................................................................17
Landreform......................................................................................................................................17
Relianceonimports.........................................................................................................................19
Water................................................................................................................................................19
Thelabourmarket...........................................................................................................................20
Consumertrends.............................................................................................................................21
HIV/AIDS...........................................................................................................................................22
Farmsafetyandsecurity.................................................................................................................23
BroadbasedBlackEconomicEmpowerment................................................................................23
Conclusionsandscenarios...................................................................................................................24
SECTION2: DEMANDFORSKILLS..................................................................................................27
AgriSETAregisteredemployersandemployeecoverage..............................................................27
EmployeecoverageintheAgriSETA...............................................................................................28
2.1
Skillsdemand...........................................................................................................................31
TheNationalEducationandTrainingStrategyforAgriculture(AETStrategy).............................31
AGRISETAsectorskillsplanningdemanddata(20082009).........................................................31
AgriSETAWSPanalyses...................................................................................................................37
Skillsdemandinthecommercialagriculturalsector.................................................................37
SkillsdemandforecastingbyAgriSETA...........................................................................................38
Researchneedsgoingforward........................................................................................................39
SECTION3:SkillsGapsandscarceskills..............................................................................................40
ScarceskillsattheDAFF..................................................................................................................40
Scarceskillsinthecommercialsector............................................................................................40
Supplyofskills..................................................................................................................................42
APPENDIX1:SkillsdemandintheDepartmentofAgriculture,Forestry&Fisheries(2008/09).....45
Appendix2: AgriSETAregisteredlearnerships..............................................................................46
REFERENCES.........................................................................................................................................47

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SECTION 1:

June2010

THE AGRICULTURAL LANDSCAPE

SouthAfricasagriculturalsectorischaracterisedbydualism:amoderncommercialfarming
sectorusinghiredfarmworkersalongsidesmallscalefarmers,mostlyintheformerhomeland
areas.Inaddition,landreformiscreatingthousandsofnewfarmingopportunitiesforemerging
blackfarmersthroughoutthecountryandacrossthescalefromlargecommercialtosmallholder
production.1

Theagroprocessingsectorcomprisesahighlydiversegroupofsubsectorsandindustries.The
majorsubsectorsinclude:
Foodprocessing
Beverages
Aquaculture
Horticulture
Medicinal,aromaticsandflavourants
Theagroprocessingsectorhasparticularlystronglinkagesbothupanddownstream.Up
stream,thesectorlinkstoagricultureacrossawidevarietyoffarmingmodelsandproducts.
Downstream,thesectorsproductsaremarketedacrossbothwholesaleandretailchains,aswell
asthroughadiversearrayofrestaurants,pubs,shebeensandfastfoodfranchises.
Moreover,thefoodprocessingsectorisnowthelargestmanufacturingsectorinemployment
termswithsome160,000employees,thisincreasestomorethanamillionjobsoncethe
upstream(primaryagriculture)isincluded.2

1.1 Size and shape of the Agricultural sector

Overview
TheSouthAfricanagriculturalsectorisadiversesectorcomprisingseveralbranches,namely:field
crophusbandry;horticulture;animalproduction);dairyfarming,fishfarming,gamefarmingand
agroprocessing.Withinthesebroadbranchesare39subsectorsthatareclassifiedaccordingto
agriculturalandeconomicfocusasfollows.Thesectorencompassesbothprimary(resource
production)andsecondary(primaryprocessing)activities.

Table1:ActivitieswithintheagriculturalsectorbyinternationalSICcode
Subsector
Coffee/Tea
Fibre

Code
30493
30118

Fruit

30132

Fruit

30133
30300
30313
61502
62111
30311

Grain
Milling

Description
Processingandmarketingofcoffeeandteaincludingcoconuts,cocoa,nuts,olives,dates,etc.
Grading,ginningandpackingofwoolandcottonrawmaterial
Fruitpackedincartons,fruitjuiceconcentratedrummedandfruitjuiceincontainerreadyfor
consumption
Fruitexportersandimporters
Manufactureofgrainmillproductsandstarches
Handlingandstorageofgrain
Wholesale&retailtradeinAgriculturalmachinery
SaleanddistributionofAgriculturalrawmaterialsandotherfarminginputs
Manufactureofflourandgrainmillproducts,includingriceandvegetablemilling,grainmill

1
2

SETAreestablishmentanddemarcationAsynthesisoftheAgriSETAlandscape,AgriSETAJune2010
2011/122012/13IndustrialPolicyActionPlan,DTI,February2010.Emphasisadded.

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Subsector

Pestcontrol
Poultry

Code
30330
30331
30332
99003
30114
11110
11120
11121
11122
11130
11210
11220
11221
11222
11300
11301
11400
11402
12109
13000
11141
30111
30115

Primary

RedMeat

30117

Seed
Sugar
Tobacco

61210
74136
87120
11140
30420
62208

June2010

Description
residues
Manufactureofpreparedanimalfeeds
Manufactureofpetfoods
Manufactureofstarchesandstarchproducts
PestControl
Poultryandeggproductionincludingtheslaughtering,dressingandpackingofpoultry
GrowingofCerealsandothercrops(notelsewhereclassified)
GrowingofVegetables,Horticulturalspecialtiesandnurseryproducts
GrowingofVegetables,Horticulturalspecialties(IncludingOrnamentalHorticulture)and
nurseryproducts.
Sugarplantationincludingsugarcaneandsugarbeetetc.
Growingoffruit,nuts,beverage,andspicecrops.
Farmingofcattle,sheep,goats,horses,asses,mules,andhinnies;Dairyfarming.
Otheranimalfarming,productionofanimalproducts(notelsewhereclassified)
Ostrichfarming
Gamefarming
Growingofcropscombinedwithfarmingofanimals(Mixedfarming)
Growingofcoffeeandteaincludingcoconuts,cocoa,nuts,olives,dates,etc.
Agriculturalandanimalhusbandryservices,exceptveterinaryactivities
Otheranimalfarming(notelsewhereclassified)
Growingoftreesassecondcropbyfarmers
Fishing,operationoffishhatcheriesandfishfarm
Productionandanimalproducts(notelsewhereclassified)
Slaughtering,dressingandpackingoflivestock,includingpoultryandsmallgameformeat.
Production,sale&marketingofAgriculturalbyproducts(e.g.bones,hides)
Slaughtering,dressingandpackingoflivestock,includingsmallgameformeatandprocessing
ofostrichproducts
WholesaletradeinAgriculturalrawmaterialsandlivestock
Transportoflivestockassupportingactivity
Agriculturalandlivestockresearch
Seedproductionandmarketing
Manufactureofsugarincludinggoldensyrup andcastorsugar
Processinganddispatchingoftobacco

Source:AgriSETA

Thecontributionofprimaryagriculturetothegrossdomesticproduct(GDP)isabout2.5%andits
contributiontoformalemploymentisabout5%3 .However,agriculturehasstrongbackwardand
forwardlinkagesintotheeconomy.

Theagroindustrialsectorhasahighercontributionofabout12%toGDP4 .

Primaryagriculturecontributed2.3%totheGDPin20095 .

ThefigurebelowshowstherelativelysmallproportionofGDPcontributionfromprimary
agriculture.Itneedstobenotedhoweverthatprocessingisnotincludedinthe2.3%asitis
includedinmanufacturing,andotherfarmingactivities.Forexample,farmslinkedtoleisure
facilities,arelocatedunderTradeandAccommodation.

NationalTreasury,2010
GCIS,2010
5
NationalTreasury,2010
4

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Figure1:ContributionofagriculturetonationalGDP

Source:NationalTreasury,BudgetReview2010

SouthAfricaisoneofthetopglobalexportersofsomeagriculturalproduce,whereitisranked
firstinthreeproducts.

Table2:SouthAfrica'sworldrankinginselectedproducts
ExportItem

SouthAfricasworldranking

Avocados

1st

Clementines

1st

Ostrichproducts

1st

Grapefruit

2nd

Tablegrapes

3rd

Plums

3rd

Pears

5th

Source:DTI,February2010

Distributionofagriculturalproduction
SouthAfricahas2.76millionhectaresofcultivatedland,ofwhichnearly10.45millionhectares
(82%)isusedforcommercialpurposes.Atotalof0.79millionhectares(only6.19%)is
permanentlyundercultivation,andmorethan10.83millionhectares(85%)israinfed.Morethan
0.7millionhectaresoflandaredegradedandleftbarebysheetandgullyerosion.About4.61
millionhectaresofnaturalvegetationaredegraded,mainlyinindigenousforests,woodlands,and
grasslands;afurther0.19millionhectaresaredegradedbyminetailings,wasterockdumpsand
surfacebasedmining.Landuseinurbanareascomprisesmainlyformalresidentialsuburbsand
townships(1millionha)andinformalsettlements(0.23millionha).Savannas(woodlandsand
bushlands)andgrasslandscover25.70%and19.92%ofSouthAfrica,respectively(Departmentof
EnvironmentalAffairs).
Although80%ofSouthAfricanlandisusedforagricultureandsubsistencefarming,only12%is
arable,andtherestisusedforgrazing.Themainagriculturalactivitiesarecropproduction,mixed
farming,cattleranchingandsheepfarming,dairyfarming,gameranching,aquaculture,
beekeeping,andwinemaking(GCIS,2010).SouthAfricaisthelargestproducerofmaize,the
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staplefoodintheSouthernAfricanDevelopmentCommunity(SADC)aswellasthemain
ingredientforanimalfeed.Thetablebelowgivesanindicationofthegeographiclocationof
productionofspecificagriculturalproduceaswellastheannualvolumeproduced.

Table3:Volumeofagriculturalproductionbyproductandlocation
Agriculturalproduct
Maize
Wheat
Barley
Groundnuts
Sunflowerseeds
Soyabeans
Sorghum
Canola

Dominantproductionlocations
NorthWest;FreeState;Mpumalanga
WesternCape;FreeState
WesternCape
FreeState;NorthWest;NorthernCape
FreeState;NorthWest;Mpumalanga;Limpopo
FreeState;Mpumalanga;KwaZuluNatal
FreeState;Mpumalanga;Limpopo;NorthWest
WesternCape;NorthWest;Limpopo
Mpumalanga;FreeState;Gauteng;NorthWest;
Drybeans
KZN;Limpopo;WesternCape;NorthernCape
Sugar
EasternCape;Mpumalanga;KwaZuluNatal
WesternCape;EasternCape;FreeState;
Deciduousfruit
Mpumalanga;Gauteng
Wine
WesternCape
Citrusandsubtropical Limpopo;Mpumalanga;EasternCape;KwaZulu
fruit
Natal;WesternCape;NorthernCape
NorthWest;NorthernCape;KwaZuluNatal;
Potatoes
Limpopo;FreeState;Mpumalanga;EasternCape;
WesternCape
Limpopo;Mpumalanga;KwaZuluNatal; Eastern
Tomatoes
Cape;WesternCape
Onions
Mpumalanga;WesternCape;FreeState
Cabbages
Mpumalanga;KwaZuluNatal
Mpumalanga;Limpopo;NorthernCape;KwaZulu
Cotton
Natal;NorthWest
Tobacco
Mpumalanga;Limpopo;NorthWest
Tea
WesternCape;EasternCape
Flowers
WesternCape
Livestock
Allprovinces
FreeState;NorthWest;KwaZuluNatal;Eastern
Dairy
Cape;WesternCape;Mpumalanga
EasternCape;FreeState;KwaZuluNatal;Limpopo;
BeefCattle
NorthWest;Mpumalanga;NorthernCape
EasternCape;NorthernCape;FreeState;Western
Sheepandgoats
Cape;Mpumalanga
Poultryandpigs

Allprovinces

Fish

WesternCape;EasternCape
Limpopo;NorthernCape;EasternCape;Western
Cape
WesternCape;KwaZuluNatal

Game
Beekeeping

Averageannualvolumeproduced
13,2metricton
2.1metricton
192000ton
88800ton
872000ton

255000ton
30800ton
60000ton
20metricton

403.3millionlitresexportedin2009
46896tonsubtropicalfruit
1853000ton
459217ton
417579ton
138161ton

10200ton

Largestagriculturalsector
3129metriclitres

930000tonbroilers
2.6millionpigsslaughteredfrom
August2007toAugust2008

2000ton

Source:GCIS,SAYearbook2009/10

Agricultureplaysanimportantpartinprovincialdevelopmentandformostprovincesprovidesa
sourceofemploymentaswellasbeingapotentialfocusforincreasedemploymentand
sustainablelivelihoods.Agriculturethereforefeaturesasakeyfocusforeconomicdevelopment

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andgrowthintheallprovinces.AgriculturalcontributiontoprovincialGDPvaries,withtheFree
Statesagriculturalsectorcontributingthemost,asreflectedbelow.

Table4:AgricultureContributiontoProvincialGDP

Province

PercentagecontributiontoGDP

FreeState
Limpopo
KwaZuluNatal
WesternCape
Mpumalanga

9.2
3
5.5(2004)
4.5(2003)
6.1

Source:ProvincialGrowthDevelopmentStrategies

Theprovincesallhavedifferentfocusesintheirdevelopmentstrategiesforagriculturealthough
theunderlyingprincipleistheimprovementofthelivesofthepeoplethroughemployment
creationinagricultureandprovisionoffoodsecuritythroughinvestmentinagriculturalprocesses
andtechnologiesthatenhanceefficiency.

FreeStatesfocusonagriculturedevelopmentisagriculturediversificationandagribusiness.
Diversificationinvolvesidentifyingcropswithadefinedmarketinlinewithnewandinnovative
agriculturalpractices.Agribusinessextractsvaluefromprimaryagriculturethroughprocessingof
rawmaterialsandprovisionofservicestoaddvaluetoproduce6 .

TheobjectivesoftheLimpopoprovincewithregardstoagriculturaldevelopmentaretriplingthe
sizeofagricultureby2015,increasingthevalueofagriculturethroughenterprisediversification,
investinginwatersavingtechnologiesandaddingvaluewithintheagrovaluechain7 .

IntheEasternCape,twothirdsofthepopulationliveinruralareasandthedevelopmentof
agricultureisakeyfactorinthedevelopmentofthepeoplessocioeconomiclivelihood.
Developmentofagriculturewillprovideemploymentandanincometomanyfamilies.Thefocus
ofthegrowthanddevelopmentstrategyistopromotehouseholdfoodsecuritythrough
expandedsmallholderproduction,developmentofcommercialagriculturethroughoptimaluse
ofagriculturallandinthehomelands,focusonlandredistributionandtenure,andintegrationof
homelandsagricultureintomainstreamprovincialagriculturalactivity8 .

KwaZuluNatalsfocusonagricultureintheGrowthDevelopmentStrategyispovertyalleviation,
asmostareasofpovertyintheprovincearerural.Theplanistolinkupruralsubsistence
agriculturalactivitywithcommercialagriculturesoastodevelopsubsistenceagriculturalprojects
intocommercialones.Theotherfocusistolinklandreformprojectstokeyprovincialagrarian
revolutionprogrammessoastomakelandtransferaneconomicgrowthopportunity.The
agrarianrevolutionstrategyinvolvesenablingaccesstomarkets,farmerdevelopmentthrough
thesetupofagribusinesses,improveroadinfrastructuretoimproveaccesstomarkets,and
expeditingthelandreformprocess9 .

FreeStateGrowthDevelopmentStrategy,20042014
LimpopoGrowthDevelopmentStrategy,20042014
8
EasternCapeGrowthDevelopmentPlan,20042014
9
KZNGrowthDevelopmentStrategy,2006
7

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NorthernCapesfocusisthedevelopmentofagroprocessing(NorthernCapeGrowthand
DevelopmentStrategy).TheNorthWestisfocusingonenablingaccesstomarketsandassisting
financiallyininfrastructuredevelopmentandmachineryacquisitionaswellasinvestinginagro
processingtechnologyandskills,aswellaspromotingefficientlanduse10 .

AgricultureholdsemploymentgrowthpotentialinMpumalangaprovince.Itaccountsfor18.1%
ofprovincialemployment,withforestrybeingthemainagriculturalactivityintheprovince.About
38.3%oftheprovinceslandisusedforforestry.Agricultureisidentifiedasakeyfocusareato
achievethestrategicgrowthdevelopmentstrategyofprovidingabetterlifeforallintheprovince
througheconomicdevelopment.Growthpotentialisthroughagriculturalinvestment,production
andbeneficiationsoastoincreaseagricultureGDPcontributionfrom6.1%to10%bytheendof
the2008/2009financialyear.Otherstrategicobjectivesaretoincreasesustainableemployment
intheagriculturalsectorfrom18%to20%bytheendof2015,improvefoodsecurityby50%by
2014,improvesustainabilityinagribusinessenterprisesby20%,andincreaseparticipationof
historicallydisadvantagedinagriculturetomeetnationalAgriBEEtargets(MpumalangaGrowth
andDevelopmentStrategy,20042014).

ThestructureoftheagriculturesectorinSouthAfrica
TheSouthAfricanAgricultureSector,primarilybasedinruralandperiurbanareas,is
characterisedbyadualagriculturaleconomycomprisingwelldevelopedcommercialfarming,
withanestablishedsupplychain,andsmall(subsistence)basedproduction.TheGeneral
HouseholdSurveyof2009(StatisticsSouthAfrica)andtheCensusforcommercialfarms,2007
(StatisticsSouthAfrica)provideaninsightintothesizeofthesubsistenceandcommercialsectors.
Precisedetailsinrelationtononcommercialandsemicommercialfarmingarenotavailable.

In2009,20.7%ofSouthAfricanhouseholdswereengagedinsomeformofagricultural
production.Table1reflectshouseholdagriculturalproductionpatternsintheprovincesand
showsthatthelargestproportionsofhouseholdsengagedinagricultureareinLimpopo,Eastern
Cape,FreeStateandKwaZuluNatal.

Table5:SouthAfricanhouseholdsinvolvedinagriculturalactivitiesbyprovince(1,000s)
Activity

Province
WC

EC

NC

FS

KZN

NW

GP

MP

Total

LP

Involvedin
agricultural
production

39

643

35

274

697

108

248

205

580

2832

2.7%

37.3%

11.4%

31.9%

26.8%

11.4%

7.1%

21.1%

43.4%

20.7%

Livestock
production

312

22

26

230

34

27

21

99

778

17.5%

48.5%

62.1%

9.6%

33.0%

31.0%

10.7%

10.4%

17.1%

27.5%

349

11

35

256

23

22

11

146

853

1.8%

54.3%

31.0%

12.9%

36.7%

21.1%

9.0%

5.1%

25.1%

30.1%

389

21

316

34

31

128

465

1390

2.7%

60.5%

12.2%

7.8%

45.4%

31.5%

12.5%

62.5%

80.1%

49.1%

0.0%

0.2%

0.0%

0.1%

0.6%

0.0%

0.5%

0.0%

0.1%

0.3%

30

220

232

330

40

175

141

173

1350

75.9%

34.2%

25.2%

84.7%

47.3%

36.8%

70.5%

68.8%

29.8%

47.7%

Poultry
production
Grainsandfood
crops
Industrialcrops
Fruit&vegetable
crops

10

NorthWestGrowthandDevelopmentStrategy

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Province

Activity

WC

Foddergrazing/
pasturegrass
animals
Forestry
Fishfarming/
Aquaculture
Gamefarming
Other

EC

NC

FS

KZN

NW

GP

MP

Total

LP

14

11

53

11.2%

0.5%

3.8%

3.5%

2.0%

2.0%

4.3%

2.0%

0.7%

1.9%

10

1.2%

0.1%

0.5%

2.1%

0.1%

0.0%

0.4%

0.4%

0.2%

0.4%

1.5%

0.1%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

2.2%

0.2%

1.3%

0.0%

0.1%

0.0%

0.0%

0.0%

0.2%

0.1%

0.0%

0.2%

0.0%

0.3%

0.4%

0.3%

0.3%

0.0%

0.0%

0.2%

*Numberssmallerthan10000aretoosmallforreliableestimates
Aparticularhouseholdcanbeinvolvedinmorethanoneactivityandpercentagesthereforedonotaddupto100%
Source:StatisticsSouthAfricaGeneralHouseholdSurvey,2009(p.318)

In2007,therewere39982commercialfarms11 inSouthAfricaasopposedtothe45818
registeredin2002.Therehasbeenacleardownwardtrendinthenumberofcommercialfarming
enterpriseswhichunderscorestheneedstogrowthecommercialagriculturesectortomaintain
SouthAfricasfoodsustainabilitypotentialandsupportinterventionstodevelopskillsacrossthe
agriculturalsector,especiallyfortransformationanddevelopmentofthesmallandemerging
agriculturalsector.

Table6:Commercialfarmingenterprisesbyprovince2002and2007
Province

2002

2007

Growth/Decline

EasternCape

4376

3896

10.97

FreeState

8531

7515

11.91

Gauteng

2206

2378

7.80

KwaZuluNatal

4038

3560

11.84

Limpopo

2915

2657

8.85

Mpumalanga

5104

3376

33.86

NorthWest

5349

4692

12.28

NorthernCape

6114

5226

14.52

WesternCape

7187

6682

7.03

Total

45818

39982

12.74

Source:StatisticsSouthAfrica,2008

WhilstthelargestproportionsofhouseholdsinvolvedinagricultureareinLimpopo,FreeState,
EasternCapeandKZN(Table1),itisintheFreeState,WesternCape,NorthernCapeandNorth
Westprovinceswherethelargestnumberofcommercialfarmsarelocated(Table2).Nodirect

11

CommercialfarmsarefarmingenterprisesthatareregisteredwithSARSforValueAddedTax(VAT)andincometax.

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relationshipcanthusbedrawnbetweenthenumbersofhouseholdsengagedinagricultureina
provinceandthenumbersofcommercialagriculturalenterprises.AgriSETAWSPdataanalysis
revealsnodirectrelationshipbetweenthenumberofemployersinaprovinceandthenumberof
formallyemployedpersons.

Categoriesoffarmingenterprises
Dualism(Mhone,2000),isausefulwayofdescribingtheagriculturalsector,bothintermsof
understandingtheeconomicsofthesectorandplanningskillsdevelopmentinterventions.This
termdescribesaformalsectorthatiswellestablishedandaninformaloremergentsector,with
thetwosectorsreliantoneachother,andoninterventionsbythestateforintegration.However
thesetwobroadcategorieshavetheirlimitations.Withinthecommercialsectortherearelarge
establishedfarmingbusinessesandsmalleronesthatstruggletosurvive,andwithintheless
formalsectorthereareemergentfarmersstrivingtoachievecommercialsuccess.Itisnecessary,
therefore,tounderstandtheagriculturalsectorascomprisinganumberofdifferenteconomic
entitiesalloperatingwithinthesamedualisticeconomicframework.Thefollowingtypologyfor
theagriculturalsectorreflectsthecomplexityoftheagriculturalsector:

Table7:Typologyoftheagriculturalsector
ProductionUnit

Turnover

Largecommercialon
privateproperty

>R2million

Mediumcommercial
onprivateproperty

R300000to
R2million

Smallcommercialon
privateproperty

<R300000

Commercialin
communalareas

Emerging
commercialin
communalareas

Ownership&Management
Familyownedbutincorporated
multiplefarms.
Rentinlandprofessional
management
Familyowned,couldbe
incorporated.Somerentinginof
landfamilymanagement
Familyowned,generallypart
time.Somelifestylefarming
(gameranches,weekendfarms)

>R300000

Communalownership
Developmentprojects
Privateownership

<R300000

>20hectares
Communalownership
Smallfarmersindevelopment
projects
Privateownership

Subsistencefarmerin
communalareas

Allotments
Marketgardens
Source:VinkandvanRooyen,2009

<20hectares
Communalownership
Privateownership
Littleformalmarketparticipation

Number

Binding
constraint

Supportrequired

5400

Marketsize
Equitycapital

Exportmarketaccess
Financialmarket
innovation

17,000

Landcapital
management

Mortgagecapitalfor
landaccess
Managementtraining

24000

Management
time

Capital
management
infrastructure
Land
(property
rights)
35000 Capitallabour
management
Employment
opportunities
1.256m

Employment
opportunities

Grantsforlandaccess
Propertyrights
Comprehensivefarmer
support
Credit
Physicalinfrastructure
Grantsforlandaccess
Propertyrights
Comprehensivefarmer
support
Physicalinfrastructure
Institutional
infrastructure
Socialwelfaretransfers

ThisconfirmsthedualismevidentfromStatsSAdata.Itincludesanestimateforemergentfarms
andprovidesinsightintothedifferenttypesoffarmingenterprises.Beingsmallandparttimecan
meansubsistencefarming,butitcanalsomeanrunningagamefarmonaparttimebasis.There
isconsiderablescopeforfarmingenterprisetomovefrombeingcommercialtosubsistenceand
viceversa.Thereissomeevidencethatthereiscurrentlyanincreaseinvolatility,withquite
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significantchangesoccurring,mainlyduetotheglobaleconomicdownturnandthesmall
marginsthatmanyagriculturalenterprisesoperatewithin.

Itisparticularlyimportanttohaveanunderstandingofthecategoryofemergingfarmers:those
whomaybestrivingtomovefromsubsistencefarmingtoamorecommercialmodel;thosewho
havebenefitedfromlandreformprocessesandwanttoestablishanagriculturalenterpriseon
thelandthathasbeenallocatedtothem;thosewhohavemadeuseofBEEfundingtoacquirea
stakeinafarmandaretryingtoachieveprofitability.Theemergingfarmersectorisneither
establishedcommercialfarmingnorsubsistenceinnatureandisthefocusofmanyofthe
governmentseffortstoachievetransformationwithinthesectorasawhole.

Employmenttrends
EmployeenumbersisamoreimportantmeasureofsizeforthepurposeoftheSETAandskills
planning,eventhoughturnovermaybemoreimportantintermsofeconomicimpactor
contributiontoGDP.ThecauseofthisdiscrepancybetweenturnoverorGDPcontributiononthe
onehandandformalemploymentnumbersontheotherisdiscussedextensivelybyMhone
(2000)andotherssuchasWebster(2004).Labourabsorptionlevelsinanenclave(second)
economyarenotoptimal.Oneconclusionthatcanbedrawnfromthisisthatskillsdevelopment
willneedtobelinkedtootherchangeswithinthesectorifitistocontributemeaningfullytojob
creation.Mechanismsneedtobefoundthatlinkgrowthtojobsandthisisnotstrictlysomething
thattheSETAcanaddress.Howeveritisimportanttolinkskillsplanningtootherprocesses,and
opportunitiesforthesewillbeexaminedaspartoftheenvironmentalscanlaterinthissection.
Thepastfewyearshaveseenhugedepreciationinemploymentlevelsandaveryhigh
unemploymentratecurrentlyestimatedat31.1%.Theagriculturalsectorhasalsowitnesseda
declineinsectoremploymentlargelylinkedtocontractionofthesector.Thesectoris
characterisedbytheneedforhighlyskilledandqualifiedfarmmanagersandtechnicalstaffon
theonehandandlargenumbersofunskilledandsemiskilledworkersontheother.Many
managersofemergingfarmsaremainlyuntrainedandunqualified.

Agriculturereliesmoreonsemiskilledlabourthanotherservicesasreflectedinthetablebelow.
Thesectoralsoreliesonmigrant,casualandseasonallabour.

Table8:PercentageunskilledtosemiskilledlabourbyDTIindustry(economicsector)classification
Sector
Agriculture
Mining
Manufacturing
Utilities
Construction
Trade
TransportandCommunication
Finance
Communityandpersonalservices
Total

1995

2008

99.0
92.0
87.0
80.0
90.0
84.0
73.0
62.0
54.0

94.1
87.9
82.1
68.8
88.3
84.2
76.8
59.5
49.8

Growth/declinein
skilledlabour
4.9%
4.5%
5.6%
14.0%
1.9%
0.2%
5.2%
4.0%
7.8%

78.2

73.8

5.6%

Source:NationalTreasury,2010

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EmploymentinthesectorisbasedonthosewhoworkinadministrationinDAFFandthosewho
workinproductionandprocessingatfarmsandinfactories.InMarch2009,DAFFhad3285
posts,with2735ofthesefilled.ThetablebelowshowstheemploymentprofileatDAFFby
occupation,race,genderanddisabilityasat31March2009.Thedepartmentemployed57%male
employeesand43%femaleemployees.ThereweremoreAfricanemployees,constituting69%of
theentiredepartmentworkforce.Verylittleprogresshasbeenmaderegardingtheemployment
ofpeoplewithdisabilities,whoconstituteonly0.4%oftheworkforce.Thisisinlinewithother
departmentacrossgovernmentwheresimilarlylittleprogresshasbeenmade.

Table9:EmployeeprofileDepartmentofAgriculture,ForestryandFisheries
Occupational
Category
(SASCO)
Legislators,
seniorofficials,
managers

African
M

Coloured

Indian

White

Totals

Total

15

14

25

19

44

1.6

Professionals

239

241

11

12

14

70

64

324

331

655

24.0

Technicians,
associateprof.

190

153

38

19

86

57

323

233

556

20.4

93

204

22

42

13

171

128

424

552

3.0

38

19

17

60

22

82

3.0

42

13

58

58

2.1

53

62

63

2.3

484

96

94

28

585

129

714

26.2

1154

728

182

105

15

25

214

301

1565

1159

2724

42.4

26.7

6.7

3.9

0.6

0.9

7.9

11.0

57.5

42.5

100

11

0.4

Clerks
Serviceandsales
workers
Craftandrelated
tradesworkers
Plant,machine
operatorsand
assemblers
Elementary
occupations
Totals
Percentage
Peoplewith
disabilities
Race

1882

287

40

515

Percentage

69.1%

10.5%

1.5%

18.9%

Source:DeptofAgriculture,ForestryandFisheries(2010)

Inrespectofoccupationsandskillsprofiles,themajorityoftheDepartmentsemployeesare
ProfessionalsandTechnicians/AssociateProfessionals(44.4%),followedbypeopleemployedin
elementaryoccupations(26.2%).

Employmentacrosstheagriculturalsectorissubjecttogrowthanddeclinevariationsrelatedtoa
widerangeofconditionsandcircumstancesproduceprices,climateandenvironmental
changes,mechanisation,technology,andthelike.Since2002thetrendhasbeendownwards.
Thereareanumberofreasonsforthisincludingmechanisationandcasualisationoflabouron
largerfarms,theeconomicdownturnimpactingonsomesubsectors,andtheglobaltrade
situation,includingchangesintheforeignexchangeratesandthefailureofsuccessiveDOHA
developmenttalkstoaddressinequalitiesinaccesstoglobalagriculturalmarkets12 .

12

TheDohaDevelopmentRoundisthetradenegotiationoftheWorldTradeOrganization(WTO).Itsobjectiveisto
lowertradebarriersglobally.Talkshavestalledoveradivideonmajorissues,suchasagriculture,industrialtariffsand
nontariffbarriers,services,andtraderemedies..Themostsignificantdifferencesarebetweendevelopednationsled

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Itisanticipatedthatgrowthoftheagriculturalsectortomeetlocalconsumerdemand,
governmentinitiativestoexpandagriculturalnicheexportmarketsandthedevelopmentofan
aquaculturesubsectortocounterdepletionofnaturalresources,islikelytoleadtocreationof
employmentinthesector.

Table10:WorkforcechangesintheAgriculturalsector2001to2010

Year

Workers

2001
2002
2003
2004
2005
2006
2007
2008
2009
2010*

Yearonyeardifference

969000
1153000
808000
828000
778000
886000
703000
764000
615000
650000

Variation

+184000
345000
+20000
50000
+108000
183000
+61000
149000
+35000

16.0%
42.7%
2.4%
6.4%
12.2%
26.0%
8.0%
24.2%
5.4%

*Quarter1

Source:StatisticsSouthAfricaSurvey(pp.210211)

Employmentcategoriesandremuneration
Itisdifficulttogetdetailedandaccurateyearlystatisticsonemploymentbytype(fulltime,
casual and seasonal employees) or on remuneration in the agricultural sector. The latest
available statistics on commercial agriculture are found in the 2007 Stats SA Census of
Commercial Agriculture. The following tables reflect survey data on the number of
permanent, casual and seasonal agricultural sector employees by province as well as total
remunerationperprovince.
Table11:Numberofpaidfulltimeagriculturalworkersandtotalremunerationbyprovince
2002
Province
EasternCape
FreeState
Gauteng
KwaZuluNatal
Limpopo
Mpumalanga
NorthWest
NorthernCape
WesternCape
Totals

Number
33718
57607
20815
75799
62635
61603
39914
31077
98207
481375

2007

Growth/Decline

Remuneration
Remuneration
Number
Number Remuneration
R'000s
R'000s
329351
580888
344629
763439
525390
599617
409526
320598
1378816
5252251

34253
53944
22979
66685
35728
46520
53741
26871
90943
431664

510404
737796
534083
968455
625436
853396
574596
339948
2029275
7173389

1.6%
6.4%
10.4%
12.0%
43.0%
24.5%
34.6%
13.5%
7.4%
10.3%

55.0%
27.0%
55.0%
26.9%
19.0%
42.3%
40.3%
6.0%
47.2%
36.6%

Source:StatisticsSouthAfrica,Report12.02.01(p.1101)

byEU,USA,andJapanandthemajordevelopingcountriesledandrepresentedbyIndia,Brazil,China,andSouth
Africa.Considerablecontestationexistsoverthemaintenanceofagriculturalsubsidies,operatingastradebarriers.
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Table12:Numberofpaidcasual&seasonalagriculturalworkers&totalremunerationbyprovince
2002
Province
Number
EasternCape
FreeState
Gauteng
KwaZuluNatal
Limpopo
Mpumalanga
NorthWest
NorthernCape
WesternCape
Totals

2007

Variance

Remuneration
Remuneration
Number
Number Remuneration
R'000s
R'000s

30936
57871
8722
37602
38614
46480
46078
68174
124968
459445

59680
69595
20975
103946
107223
86242
62653
121613
331406
963331

30565
45150
11957
34383
31833
32826
32008
47874
98546
365142

106497
98996
93461
154286
124159
176363
75250
123723
485108
1437843

1.2%
22.0%
37.1%
8.6%
17.6%
29.4%
30.5%
29.8%
21.1%
20.5%

78.4%
42.2%
345.6%
48.4%
15.8%
104.5%
20.1%
1.7%
46.4%
49.3%

Source:StatisticsSouthAfrica,Report12.02.01(p.1101)

ThetablesabovereflectthattheWesternCapewasthebiggestemployeroflabouron
commercialfarmsin2007,withamajorityoftheemployeesbeingcasualandseasonal.The
EasternCapeemployedtheleastnumberofcommercialfarmemployees.Thecomparatorfigures
for2002and2007wouldappeartoshowacontinuouscountrywidereductioninemployment
bothinpermanentemployeesandcasualandseasonalworkers.TheexceptionistheNorthWest
thathasexperiencedanincreaseinfulltimeemployees.

Thecurrentminimumwageforfarmworkers(February2010)isR1316.69permonth13 .Monthly
salariesdifferacrosssubsectorswithhighestpaidworkersinprimaryproductioninthefisheries
anddairysubsectors.
Table13:ApproximatemonthlywageratesinAgricultureforselectedsubsectors
Subsector

PrimaryProduction

Processing/Packhouse

Meat

R2000

Dairy

R2650

R1100

R1400

R800

R1200

R5000
(crewman)

R1892

Wines
Flowers
Fisheries
Source:DTI,2010 14

Vink&vanRooyen(2009)indicatethatbeforetheintroductionofminimumwagein2003,the
realcashremunerationforemployeeshadbeenincreasing.Howeverovertimetheunitcostof
labour(theratioofthetotalcostoflabourtothetotalvalueofoutput)hasbeenindecline,
includingasteepdropduringandaftertheintroductionofminimumwages.

13

DepartmentofLabour,2010
Source:DTI:(DatasourcedfromSAMIC,DairyIndustryJAG,WOSA,SAFEC,SAPelagicFishIndustryAssociation)

14

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In1970,foreveryR1ofoutput,16centswasspentonlabour.By1980thishasdroppedto13
centsforR1ofoutput.By1994thefigurehadincreasedto19cents,decliningto17centsin1998
andto11.7centsin2001.By2007ithadreducedto10.8cents.Furtherresearchwillbeneeded
toestablishthecurrentsituation,butthereisreasontobelievethatthedeclinehascontinued,
withwagesbeingverylowbothintermsofunitcostsandinrelationtoothergroupsofworkers
intheeconomy.

StrictlyspeakingitisnottheroleoftheSETAtoengageinthecomplexregulatoryframeworkfor
theagriculturallabourmarket.ItisfortheDepartmentofLabourandNEDLAC,withtheir
employerandorganisedlabourstakeholderstofindwaysofbalancingtheneedforprotectionof
vulnerableworkerswiththeneedtocreateaframeworkthatencouragesthecreationofjobsand
improvedjobsecurity.Thereasonthatmoreresearchisneededinthisarea,andinparticular
detaileddiscussionswithindustryandlabourrepresentatives,istoestablish

Theextenttowhichskillsdevelopmentinterventionscanimprovetheprospectsforjob
creationandimprovedjobsecurity,and

Themechanismsthatcanbeestablishedtoenableuninterruptedskillstraining,inthe
contextofcasualisationanduseofcontractandseasonallabour.

StakeholdersintheAgriculturalsector
National government departments
ThereareanumberofnationalgovernmentDepartmentsandspheresinvolvedinthechallenges
oftheagriculturalsector.Thefollowingtablesetsoutthebroadcontributionthateach
departmentisintendedtomake.

Table14:GovernmentdepartmentrolesinrelationtoAgriculture
Department
Role
DepartmentofAgriculture,ForestryandFisheries
Agriculturalpolicyandsupport
DepartmentofRuralDevelopmentandLandReform LandReformandlandclaimssettlements
DepartmentofEconomicDevelopment
Economicplanning
NationalTreasury
Macroeconomicpolicy
DepartmentofTradeandIndustry
Industrialstrategy(IPAP2)
DepartmentofWaterAffairs
Themanagementofwatersupply
DepartmentofLabour
Labourmarketpolicy
DepartmentofHigherEducationandTraining
HRDandskillsplanningandSETAs

Inrelationtopublicspendingonagriculturetheagriculturalnationalbudgetconstitutesabout
0.5%ofthenationalbudget.Thefigurebelowreflectstrendsinnationalbudgetingforthe
agriculturalsectorbetween1996/7and2011/12.

Someanalysts15 havearguedthatstateexpenditureonagricultureshowslackofprioritisationof
thesector,especiallyconsideringthatthebudgetremainslowerthanitwasinthelate1980s,
whenitnowcatersforagreaternumberoffarmersthanitdidduringapartheidsegregation.

15

Greenberg,2010,p.2

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Figure2:NationalbudgetsforAgriculture,19962011(adjustedforinflation)

Source:Greenberg,2010

TheDepartmentofAgriculture,ForestryandFisheries(DAFF)isresponsiblefortheagricultural
sector.Thedepartmentworkswithvariousorganisationstopromotetheinterestsofthesector:
ItregistersallSouthAfricanPestControlAssociation(SAPCA)qualifiedinspectors.
ItworkswiththeAgriculturalResearchCouncilforresearchtooptimisethecontrolof
migratorypests.
TheDirectorateonMarketingworkswiththeNationalAgriculturalMarketingCouncil
(NAMC)onissuesrelatedtoequitableaccesstomarketsincludingpolicyformulation,
issuingofpermits,andcoordinatinginterdepartmentalrelationstoenhancemarketing.
HistoricallytheDepartmenthasemployedalargenumberofextensionofficerslocatedin
farmingcommunitieswhohavesupportedandadvisedfarmers.Thisservicehasbeenin
declineinrecentyears,butremainsanimportantaspectofstatesupporttothesector.

TheaboveroleswillbesubjecttosomereviewinthecontextofIPAP2andalsothedebates
aroundtheroleofthestateintheeconomy.Theissueisnotonlylevelsofspending,butalso
clarifyingtheroleofgovernmentinrelationtothebusinessofthesector.
Sector representatives
Therearethreemajorumbrellaorganisationsrepresentingtheinterestsoffarmers,AgriSA,
TLUSAandtheNationalAfricanFarmersUnionofSouthAfrica(NAFU).

AgriSAandTLUSArepresentsbothcommercialfarmersandcooperativesintereststhroughits
engagementatnationalandinternationallevel.AgriSAisamemberoftheSouthernAfrican
ConfederationofAgriculturalUnions(SACAU),aregionalfarmersunionforfarmersinSouthern
Africa.AgriSAhasstructuresinalltheprovinces,exceptLimpopo.

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NAFUisaunionforpredominantlypreviouslyhistoricallydisadvantagedsmallholderfarmerswith
amembershipbaseincludingfarmers,agribusinesses,farmersorganisations,corporationsand
individualswhosupporttheirgoals.NAFUisrepresentedbydifferentunionsinalltheprovinces.

ThereareotheremployerorganisationswhoarenotaffiliatedtoAgriSAandNAFUincluding:
AgriculturalIndustrialandMediumEmployersOrganisation
Agricultural,MiningandIndustrialChemicalManufacturersAssociation
AgrilaborEmployersOrganisation
AlgoaMeatTradersAssociation
EastCoastPoultryProducersEmployersAssociation
EastLondonandDistrictMeatTradersAssociation
FertiliserIndustryEmployersOrganisation
LandbouWerkgewersorganisasie(Workinfo.com)
RedMeatProducersAssociation

TheAgriculturalResearchCouncilisanautonomousstatutorybodythatprovidesresearchto
DAFFandtheprovincialdepartmentsofagriculture.FiguresavailableforSouthAfricas
investmentinagricultureresearchanddevelopmentshowthatSouthAfricawasabove
internationalnormsofinvestmentinR&D,whichare0.53%ofagriculturalGDPfordeveloping
countriesand2.36%fordevelopedcountries.InSouthAfrica,in2000,agriculturalR&D
investmentinrelationtoagriculturalGDPwas3.04%16 .

Therearesixmajorsourcesofcreditforfarmers:banks(50%),agriculturalcooperativesand
agribusiness(12%),theLandBank(21%),privatecreditors(8%),othercreditorsandfinancial
institutions(9%)andgovernment(1%)(GCIS,2010)

1.2 Factors impacting development in the Agriculture sector

Severalinternationalandlocalfactorsimpactontheproductivityoftheagriculturalsectorandits
growth.Keyamongsttheseare:

GrowthoftheSouthAfricaneconomyandrisingconsumerdemand
Internationaltradeandtradeagreements
Theglobalrecessionandriseinfoodprices
Thelandreformprogramme
Relianceonimports
Wateravailability
Changingconsumerpatternsanddemands(e.g.organicfoodstuffs)
Technologicalchangesandmechanisms
Qualitystandards
Farmsafetyandsecurity
Broadbasedblackeconomicempowerment
Legislation
Skillsdemandandsupply
HIV/AIDS

16

Vink&vanRooyen,2009

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Thesekeyfactorsareclusteredanddiscussedbelow:

Futuresectoreconomicgrowthanddevelopment
South African sector growth plans (IPAP2)
The2010/20112012/2013IndustrialPolicyActionPlan(IPAP)identifiesfivestructural
challengesthatexistedintheSouthAfricaneconomybeforetheglobaleconomicdownturnand
whichhavebeenexacerbatedbytherecenteconomiccrisis.Thesechallengeswereevidenteven
duringthetimeSouthAfricawasexperiencingrelativelyhighgrowthratesbetween2005and
2007andhavecontinuedduringtherecession.Thesechallengesare:

1. Structuralimbalancesinthegrowthpathincludinggrowththatislaggingbehindother
mediumandlowincomecountries.
2. Unevenperformanceofthemanufacturingsectorwithsomedivisionsliketheautomotive
sectorexperiencingexponentialgrowthwhileothersectorshavestagnated.
3. Employmentgrowthbeingsustainedbycreditextensionandconsumptionratherthanby
productivesectors,leadingtoalargecurrentaccountdeficit.
4. Lowprofitabilityofmanufacturing.
5. Lowsavingsandinvestmentfromfinancialsectorgrowth.Only5.2%ofprivatecreditwas
extendedtofixedinvestmentin2008.

KeysectorshavebeenidentifiedforIPAPsfocus,includingagroprocessing,whichhasadiverse
groupofindustriesandsubsectorsincludingfoodprocessing,beverages,aquaculture,
horticulture,medicinal,aromaticandflavourants.Keyactionplansfortheagroprocessingsector
areidentifiedinIPAP2as:
DevelopmentofaNationalFoodControlAgencytoconsolidatethesector;
Developmentofaquaculturetosupplementdwindlingwildfishstocks;
Designatingspecificareasforutilisationofaquaculture;
Developmentoftheorganicfoodsector;
Developmentofthesmallmillingindustry;
Enhancingcompetitivenessinfruitandvegetablecanning;
ImprovingbeneficiationofRooibosandHoneybushproducts(IPAP2,2010).
International Trade
SouthAfricaisamajorexporterofAgriculturalproduce.InparticularSouthAfricanfruitandfruit
derivedproductssuchaswineandfruitjuicearecompetitiveintheglobalmarket.Howeverin
manysubsectorswhereexportpotentialexistsgrainandmeatseriousproblemsfacethe
industry.AkeychallengeistheunevenplayingfieldexperiencedbySouthAfricanexporters.
MajorglobalcompetitorsincludetheUnitedStatesandthecountriesoftheEuropeanUnion,
wheregovernmentsubsidiesinvariousformsareinplace.NosuchsubsidiesareinplaceinSouth
Africamakingitdifficult,ifnotimpossibleforSouthAfricanagriculturalproducestoenter
developedcountrymarketsduetothepricesthattheyhavetoaskforproducts.I

Inaddition,thevalueoftheRandhasfluctuatedfromlevelsofaroundR10totheUSdollartoas
littleasR7tothedollar.WhentheRandisstrongexportbecomesdifficultbecauseitcostsmore,
inthecaseofthemovefromR10toR7a30%costincreasefortheimporter.Itisimpossibleto
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predictwhethertheWorldTradeOrganisationnegotiations,knownastheDOHARound,will
achieveprogressinthecomingyears.Historicalevidenceisthatduringperiodsofglobalrecession
developedeconomiesbecomemoreprotectivenotless,andsothecurrentoutlookisnotgood.
NorisitpossibletopredictthevalueoftheRand,thoughcurrentthinkingingovernmentisto
movetowardaweakerRandtoencourageexports.Thesearetwokeyvariablesthatwillneedto
befactoredintothedifferentsectorgrowthscenariosforthefuture.
Global recession and rise in food prices
EconomicgrowthsloweddownsignificantlyinsubSaharanAfricaandinSouthAfricain2009but
thereappeartobesignsofrecovery.GDPgrowthintheregiondeclinedfromabout6%in2004
2008toabout1.8%in2009/10.GDPgrowthinSouthAfricawas1.6%in200917 androseto4.6%
inthefirstquarterof201018 ,thoughmuchofthisisrelatedtotheincomederivedfromthe2010
FIFAWorldCupandmaynotbesustained.Projectionsaregenerallyforaslowrevivalwithaset
backaftertheslightriseresultingfromtheWorldCup.Areturntothe6%levelsofthe2007/8
couldtakesomeyears.

TheglobalrecessionreducedthedemandforAfricanexportsandreducedcapitalflowstothe
regionbutitisanticipatedthatthedemandformineralresourcesbyAsianandWesternpowers
willresultinboththeexpansionofexportsandexpandedforeigndirectinvestment.The
competitionbetweenIndiaandChinaforAfricanmarketsisalsoexpectedtoboosttradetothe
benefitofAfricansuppliers.SouthAfricaisexpectedtoparticularlybenefitfromdirectforeign
investmentfromChinaandIndia.ChinahasalreadybecomeSouthAfricaslargestmarketfor
exportsandsupplierofimports19 .

Risingfoodpriceshaveforcedgovernmentsaroundtheworldtocontrolpricesofmaize,bread,
riceanddairyproducts.InSouthAfrica,foodpriceinflationbetweenDecember2005and
December2006averaged7.88% 20 .Althougheffortsarebeingmadetoreducebarriersto
poorerfamiliesinrelationtobasicfood,therehasbeennomovetosubsidisefoodgenerally.This
maychange,thoughthespaceforsignificantlevelsofsupportisrestrictedbecauseofreduced
revenuefromincometaxesresultingfromtherecession.Theglobalcreditcrunchandrecession
havemeantareductioninpublicexpenditureandfunding,whichhasaffectedtheagricultural
sector21 .

Landreform
InSouthAfricaspecifically,landreformhasasignificantbearingonfoodsecurityandagricultures
contributiontoGDP.Theobjectiveofthelandreformprogrammeistotransfer30%of
agriculturallandtoblackownershipby2014(deferredto2025)toensuremoreequitableaccess
tolandbyhistoricallydisadvantagedpeopleandtoincreasetheirparticipationinagricultural
activities22 .Landreformhasbeeninformedbyfourprocesses23

17

DepartmentofAgriculture,ForestryandFisheries,2010
StatsSA,2010
19
DepartmentofAgriculture,ForestryandFisheries,2010
20
DepartmentofAgriculture,ForestryandFisheries,20102011StrategicPlan
21
EconomicCommissionforAfrica,2009
22
Xingwana,2008
23
CDE,2008
18

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Landrestitution,involvingreturninglandorprovidingfinancialcompensationtothose
whoselandwasdispossessedduringapartheid;
Landredistribution,transferringmorelandtothehistoricallydisadvantaged;
Tenurereform,modernisinglandtenurerulesandaccesstolandownership;and
Providingfinancialsupportforthedevelopmentofemergingfarmers.

Inrelationtoprogresswithlandreform,bySeptember2009,only6.9%ofagriculturalland(about
5.67millionhectares)hadbeentransferred,andamajorityofthebeneficiarieshavenotyet
occupiedthelandduetolackofinfrastructure,inputortechnicalsupport.Thefollowingtable
givesanindicationoftheprogressoflandreformsincetheinceptionofthefirstdemocratic
government.

Table14:Landtransfersandbeneficiaries1994to2009
Province

Redistributionandtenure
#

EasternCape
FreeState
Gauteng
KwaZuluNatal
Limpopo
Mpumalanga
NorthernCape
NorthWest
WesternCape
Total

675
799
286
690
291
444
271
300
223
3979
Source:Greenberg,2010

Hectares

353357
350291
34513
547414
91235
322839
952744
268566
122304
3043264

Restitution

Beneficiaries

Claims

25633
7721
7328
67761
7403
13950
2773
40539
12750
185858

16201
2662
13159
14752
3382
2694
3682
3709
15546
75787

Hectares

94834
47615
9476
642447
513024
399876
539620
373642
3769
2624303

Total
Beneficiaries

215201
40893
70179
433168
220227
225877
100554
172963
118165
1597227

Hectares

448191
397906
43989
1189861
604259
722715
1492364
642208
126073
5667567

Beneficiaries

240834
48614
77507
500929
227630
239827
103327
213502
130915
1783085

Achievementofthe30%landreformtargetisbeingmadedifficultbylandprices.Underthe
willingbuyerwillingsellerscheme,thegovernmentwillneedR74billiontobeabletopurchase
enoughland.Whileresourcesmaybeavailable,therearesuggestionsoflackofcapacity.The
DepartmentofRuralDevelopmentandLandReform(DRDLR)wasabletospendonly31%ofits
landreform2009/10budgetinthefirstsixmonthsofthefinancialyear.Goingforward,this
Departmentneedstoidentifywhattherealchallengesarewiththepaceoflandreformdelivery
sothattheycanbemitigatedtomeetthe2025target.Apriorityistheretentionofskills,skills
transferandskillsdevelopmentduringthetransferofland,aswellasretentionofnationalfood
productiontoavoidlossofproduction.

Supportfornewbeneficiariesoflandtoensuresustainedproductivityisderivedfromtwomain
sourcesoffundingtheBroadeningAccesstoAgricultureThrust(BADAT)andthe
ComprehensiveAgriculturalSupportProgramme(CASP).CASPisaconditionalgrantfromthe
DepartmentofAgriculture,ForestryandFisheriestoprovincialdepartmentstosupportemerging
farmerdevelopment.ProvincialfarmingbudgetsdedicatedforfarmersupportinMpumalanga,
theFreeState,NorthernCapeandtheWesternCapehaverisensignificantlyandthosein
KwaZuluNatalandGautenghavewitnessedaslightincrease.EasternCapeandLimpopo
agriculturalbudgetshavebeensteady.TheNorthWestistheonlyprovincewheretherehasbeen
asharpdeclineintheshareofthebudgetdedicatedtofarmersupport24 .

24

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Relianceonimports
OveralltheAgriculturesectorcontributespositivelytothebalanceofpayments.
SouthAfricaremainsfoodsecure.Thevalueofourexportsincreasedby46.4%from
R33656millionin2007/08toR49278millionin2008/09.Duringthesameperiod
theestimatedvalueofimportsroseby12%,fromR34009milliontoR38401million,
resultinginapositivetradebalance 25

SouthAfricadependslargelyonworldmarketsforseedproductionandagrochemicals.Regarding
seedproduction,thereareonlythreecommunityseedproductionschemesinLimpopoand
Mpumalangabeingpilotedwithstatefunding.Tentoplargecompanies,includingtwoSouth
Africancompaniesandmultinationals,haverightstoovertwothirdsofregisteredseedvarieties
inSouthAfrica.Despitethedominanceofgeneticallymodifiedandhybridseedinsomesub
sectorslikemaize,sunflowerandsorghum,openpollinatedvarietieshavebeenresilientinSouth
Africa,enablingthepossibilityofalternativeseedsourcesnotdependentontechnological
processes26 .

Inrelationtoagrochemicals,deregulationandliberalisationinthefertilisersectorledtothe
shutdownoflocalproductioncapacity,andSouthAfricabecameanimporteroffertiliserforthe
firsttimein2000.Therearethreelargeplayersinthefertilisersector,SasolNitro,Yaraand
Omnia.SouthAfricaimportsanestimated70%offertilisersandpesticides.Fertiliserpricesrose
byover200%between2006and2008,butdroppedsomewhatafterthat.However,thishike
signifiedthevolatilityoftheagrochemicalsindustryandSouthAfricasdependencyonimports,
andthepotentialriskforemergingfarmersandfoodproductionofthisdependenceonimports,
asthecountrycannotcontroltheprices,makinginputsbothdifficulttobudgetforandinmany
casesunaffordable.Thepriceofagrochemicalsisalsoparticularlyinfluencedbythepricesofoil
andtheexchangerate.

ThegeneralunderstandinginrelationtojobcreationisthataweakerRandwillimproveexports
andthereforeenablejobcreation.Ofcoursethedownsideofthisstrategyisthatimports
becomemoreexpensive.Sowhatmaybeanadvantageforthosesubsectorswhoareexpanding
theirexportvolumes,thoserelyingonimportedagrochemicalswillbeunderincreasedpressure.

Water
Waterisbothanessentialandscarceresourcefortheagriculturesectorandisbeingthreatened
byclimatechanges.Cropproductionreliesheavilyonwaterandyetaccesstowaterisnotbeing
addressedinasystematicwayinthelandreformprocesses.Greenbergsuggeststhatthe
relationshipbetweenlandreform,agriculturalsupportandwaterresourceprovisionis
inadequate,andawaytoaddressthiscouldbeestablishedbylinkingwaterprovisiontoland
transferorinvestinginirrigationforbothcommercialandresourcepoorfarmers.However,
investinginirrigationinthecontextofwaterscarcityandclimatechangemaynotbethebest
option.Whatcouldbeneededisfindingwaystomaximiseefficiencyofthe60%ofSouthAfrican

25
DepartmentofAgriculture,ForestryandFisheries,StrategicPlan2010/11
26

Greenberg,2010

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June2010

waterusedforirrigation,by,forexample,usingmethodssuchasdripormicroirrigation,which
areexpensivetosetupbutwhichreducewaterwastageby510%27 .

TheDepartmentofWaterAffairsisresponsibleformanagingwatersupplyandhastogive
authorisationforagriculturalprojectsandotherdevelopments.Thedepartmentneedstobeseen
asanimportantstakeholderintheagriculturalsector.

Thelabourmarket
SouthAfricarecordedanunemploymentrateof24.3%in2009(narrowdefinition).Ifpeoplewho
arenolongeractivelyseekingworkareconsidered,thebroadunemploymentraterosefrom
26.7%to31.3%,illustratedinthefigurebelow.Asadirectconsequenceoftheglobaleconomic
downturnin2008,870000formaljobswerelostin200928 .Othershavequotedafigureofover1
million.

Figure3:OfficialunemploymentinSouthAfrica,20032009

Source:NationalTreasury,2010

Annualemploymentlossfollowedsectorgrowthpatterns,withagriculture,mining,
manufacturingandtradefacingthehighestjoblossesastheirsectorgrowthcontracted.
Unemploymentisespeciallyamajorproblemamonglowerskilledworkersandyoungerpeople.
Youthemploymentinthe1524yearagegrouphasfallenby219000(13.6%),and48.3%of
peopleinthisagegroupareunemployed.Employmentofsemiskilledandunskilledworkershas
contractedby527000,andmaleemploymenthasgonedownby550000(7.1%)whilethatof
womenhasdecreasedby320000(5.2%).Thenumberofdiscouragedworkers,i.e.thoseno
longeractivelyseekingwork,hasincreasedfrom518000to1.7million29 .

Clearlytheexistenceofaverylargepooloflargelyunskilledunemployedworkershasanimpact
onthefarmingsector.Itdriveswagesdownandcreatesopportunitiesforcasualisationandthe
expansionoflabourcontractagenciesandbrokers.Inadditiontherearesignificantnumbersof
foreignnationals,mainlyfromZimbabweandMozambique,whoareseekingworkandoften
findingitonfarmsandinprimaryprocessingandpackagingplants.Therearebenefitstothe

27

Greenberg,2010
NationalTreasury,2010
29
NationalTreasury,2010
28

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sectorwithskilledandsemiskilledworkerscomingintothelabourmarketandbeingabsorbed
intotheworkforceandhelpingraiseproductivitylevels.Howeveratthelowerskilledendofthe
markettheexistenceofthispoolbringsfurthercasualisationanddownwardpressureonwages.
Tensionsarelikelytoincrease,andfurtherprotestseitherintheformofxenophobicoutbreaksor
actionsagainstfarmersmaywellincrease.

Aviewoftenexpressedbyfarmemployersisthatcurrentlabourlegislationmakesdismissing
workersdifficultandsotheavailabilityoflabourwithoutenteringintocontractsofemploymentis
anattractivewayofavoidingthelegislationanditsobligations.OrganisedLabourisseekingto
restricttheseopportunitiesthrougheitherregulatingoreliminatinglabourbrokers,andefforts
arebeingmadetoregulatetheuseofforeignlabour.Howeverfortheforeseeablefuturethe
trendisforformallyemployedpeopletobereducedinnumber.

Inrelationtotheemergentsectortherewillalsobeareluctancetoenteremploymentcontracts
withworkers.Thefactthatmanyhouseholdsareengagedinsomeformoflargelyunpaid
agriculturalworkmeansthatthereissignificantcasualworkdatingbackmanyyears.Helping
changethissituationintoonewherecasualorunpaidjobsaretransformedintoformaljobswith
regularwageswilltaketime.Itisalsolikelythatassomeemergentfarmsbecomeestablished
theywillactsimilarlytoestablishedfarmsandinstituteaformofcasuallabourratherthan
expandingaworkforceforwhichtheywouldhavetotakealevelofresponsibility.

FromanAgriSETAperspectivetheselabourmarkettrendsmeanthatwhilstlevyincomecanbe
directedatarelativelysmalllabourpool,onethatismanageableintermsofplanningand
implementation,thesizeoftheinformal,casualandunemployedlabourforceinthesectorfor
whomnolevyispaidandwhohavenoemployertoplanfortheirskillsneedsisverylargeand
itsneedsalmostunlimited.ClearlytherelationshipwiththeNationalSkillsFund(NSF)becomes
criticalinrespectoftheentirenonlevyincomesector.Againthelevelofsupportavailablefrom
nonlevyincomesourceswillbeanimportantvariableinlookingatfuturesectorskills
developmentscenarios.

Consumertrends
SouthAfricacurrentlyproducesenoughfoodtomeettheneedsofitspopulation.However,
consumptionofthreemainstaples,maize,wheatandvegetableshasbeenvolatilesince1985
andremainsbelow1990levels.ConsumptionofmaizeandvegetablesbySouthAfricansis17%
and32%lessrespectivelythanin198530 .

Themainreasonsforthislieinthegrowinglevelsofpovertyandthedifficultiesthatfamilieshave
inpurchasingnutritiousfood.Whilstgovernmenthasincreasedthelevelsofsocialgrantsand
increasedthenumberofpeoplereceivinggrantstoaround13million,theincomesofpoor
familieshavebeenbadlyhitbyarangeoffactors,includingjoblossesandrisesinfoodprices.The
approximately1millionpeoplewholosttheirjobsin2008/9meantalossofincomeformany
millionsofdependents.Risesinfoodpriceshavealsohadadisproportionateimpactonthepoor.
Whilstfoodisavailableitisoftennotaccessibletofamiliesontheincomelevelsthattheyhaveto
managewithin.Theresultisthatless,andlessnutritious,foodispurchased,whichinturn
impactsontheabilityoffarmerstoselltheirproductslocally.

30

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Whilstthereisnoevidencethatgovernmentwillreduceitseffortsinrelationtopovertyreliefand
socialbenefits,includingsuchprogrammesasschoolfeedingschemesandfoodparcelsduring
periodsofdrought,thestateofpublicfinancesmaynotenabletosupportthepovertythatgrips
manyruralareas.Ifrealincomelevelsforthepoorweretoriseitcouldhaveasignificantimpact
ontheeconomyoftheagriculturalsector.Equallyanimprovementintheruraleconomywith
increasedagriculturalproductionandjobs,woulddramaticallyimpactonthecapacityofpeople
tobuynutritiousfood.Achievingapositivegrowthpathinruralareasisahugechallengefor
government,andonethatiskeytogovernmentsMediumTermStrategicFrameworkand
IndustrialPolicyActionPlans.

HIV/AIDS
SouthAfricahasahighprevalenceofHIVandAIDS.TheHIVprevalenceamongpeopleagedtwo
andabovewasestimatedat10.9%in2008.

Table15:EstimatedHIVpercentageprevalencebyagegroup(20022008)
Age
2002
2005
2008
Change
Children(214years)
Youth(1524years)
Adults(25andolder)
1549yearolds
Total(ages2to49)

5.6
9.3
15.5
15.6
11.4

3.3
10.3
15.6
16.92
10.8

2.5
8.7
16.8
16.9
10.9

3.1
0.6
1.3
1.3
0.5

Source:Avert,2009

ThetableaboveshowsthatHIVprevalenceishighestamongstthoseaged25yearsandolder.
Givenyouthlabourmarketanalyseswhichpointtopeoplefrompreviouslydisadvantaged
backgrounds,mainlyAfricanmales,accessingformalemploymentforthefirsttimeatage2527,
thispopulationcanbeheldtorepresentpeopleinemployment.Research31 hasestimatedthat
by2020,thepandemicwillhaveclaimedatleast20%ofemployeesintheagriculturalsectorin
SouthernAfrica.

HIVandAIDShavesignificantramificationsintheagriculturalsectorforbothcommercialfarming
andsubsistencefarming.Theimplicationsinclude:
Decreaseincultivatedland
Focusonlesslabourintensivecropandanimalproduction
Decreaseinwomensagriculturalproductivityastheytakeonamorecaregivingrole
Lossofskills
Increaseinabsenteeismfromwork
Decreaseindailyworkoutput/productivitybecauseworkersareweakerfrominfections

TherearesuggestionsthattheimpactofthepandemicinSouthAfricademandssectoral
intervention,althoughthismaybedifficultintheagriculturalcommercialsectoras:
Seasonalworkers,whoseemtobemorevulnerabletoinfectionbecauseoftheirlow
socioeconomicstatus,arenotinoneplacelongenoughforcareprograms.Further,

31

IngeloziManagementSolutions,2008

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farmersandemployersmaynotfeelresponsibleforseasonalworkersinthesameway
theywouldinvestintheirpermanentemployees.
TheremaybeuncertaintyaroundlandreformwhichmayputHIVinterventiononfarms
onthebackburner.
TherearenopoliciesthatenforceHIVeducationandcareonfarmsinthesamewaythat
legislationlikeBEEdoesforownership.Asaresult,HIVinterventionmaybeleftto
goodwillandemployersmayfeelitismoreimportanttocomplywithissuesthatare
monitored.

Farmsafetyandsecurity
SouthAfricahasbeenplaguedbyunacceptablyhighlevelsofviolentcrimeandmurderformany
yearsnow.Farmshaveexperiencedthisandthoselivingonfarmsfeelandareextremely
vulnerable.TheSouthAfricanChamberofCommerceandIndustry(SACCI)hasarguedthat
"UsingthenominalGDPfigurefor2009ofR2.4trillion,a3.22percentcontributionof
agriculturetoGDPandanestimateof39,982farms(asat2007)inSouthAfrica,thecost
ofamurder/attackonafarm,totheeconomy,wasR1,932,869perannum."

SACCIacknowledgesthatthisestimateisflawedasitdoesnottakeintoconsiderationthefact
thatfarmingunitscontributedifferentlytoGDP,andthatnoteveryattackormurdercontributes
tofarmshutdownorlossofproductivity.However,ifnotaddressed,theseattackscouldleadto
lossoffarmingsectorsasfarmersmigratetosaferregions.ThiswillaffectemploymentandGDP
contributionofthesector.Theneedforsafetyandsecurityonfarmsmayalsoshiftfarmersfocus
inskillsdevelopmenttoincludepersonnelwhohaveskillsinsafetyandsecurity.

BroadbasedBlackEconomicEmpowerment
TheaimoftheAgriBEECharter(gazettedin2008)istoincreasetheinvolvementofblackbusiness
inagriculturethroughownershipandcontrolasexecutivesandseniormanagersofnewand
existingagriculturalbusinesses.TheextenttowhichAgriBEEistransformingthesectorisnot
known,asitistooearlytotell,butarecentsurveyconductedbyABCandtheIDCshowedthat
amongtheABCrespondents,in200746%ofenterpriseswerebusyconstructingaBEEstrategy,
and46%claimedtobeimplementingaBEEstrategy.

AsurveyofthedairyindustryintheWesternandEasternCapein2008showedthatonly6%of
firmshadaBEEstrategyinplace.Italsoseemsfromsurveydatathatcompaniesarefocusingon
theskillsdevelopmentandsocioeconomicaspectsofBEEratherthanonownership32 .Itwould
appearthatalthoughtherehavebeensomesignificantBEEpurchasesofviablefarms,andsome
employeeempowermentprojects,includingsomequitehighprofileonesintheCapeWinelands,
theextentofownershipchangehadbeenlimited.Oneofthefactorsistheveryhighlevelof
singlepersonorfamilyownershipintheagriculturalsector.BEEismorestraightforwardinthe
corporateworldwheresharescanbeexchanged.Forafamilybusinessitisamatterofsellingoff
partoralloftheland,andthetendencyistoselloffthoseareasofthefarmthatareexpendable
fromabusinesssustainabilityperspective.

32

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Whilstthereisdiscussioningovernmentabouttheendingofthewillingbuyer,willingseller
concepttheConstitutionitselfprovidesforpropertyrights,andsoalthoughsomepressuremay
beexertedthroughlegislationandregulationtheextentandspeedofchangemaynotbefast.
Themechanismsforencouragingthetransferofsignificantlevelsofownershiphavenotyetbeen
created.ThefocusoftheSETAisthereforelikelytobemorethebeneficiariesoflandreform,and
emergentfarmers,thoughprojectsofaBEEnaturecanbetargetedastheyarise.

Conclusions and scenarios

Itisusefulwhenlookingatpossiblescenariostoexaminethekeyvariablesoruncertaintiesandto
projecthowvariationsonewayortheotherwillhaveanimpactonthedevelopmentandgrowth
ofthesector.Fromthesectoranalysisandfactorsthatarecontributingtochangeinthesector
therearesomekeyfactorsthatseemtoemerge.

Firstappearstobetheeconomyandrelatedissuesofthelabourmarketandthechallengesof
labourabsorptioninanenclaveeconomy.Thesefactorsdetermineontheonehandwhether
therewillbegrowthanddevelopment,andontheotherwhethersuchimprovementswillresult
inimprovedemploymentopportunitiesandthecreationofavirtuouscycleofdevelopment.

Secondistheroleofthestateandthevariousgovernmentdepartmentswhoseplansandwork
impactontheagriculturalsector.Relatedtothisislandreformthatisinevitablydrivenbythe
stateandnottheownersoflandorthelandless.Theviewexpressedbymanyengagedin
agrarianreformisthatthestatemustplayasignificantrole.Itbecomesclearthatasuccessful
agriculturalenterpriserequiresanumberoffactorstobeinplacetobesuccessful.Theseinclude
accesstoland(DepartmentofRuralDevelopmentandLandReform),agriculturalsupportwithin
asupportiveagriculturalframework(DepartmentofAgriculture,ForestryandFisheries),accessto
consistentwatersupply(DepartmentofWaterAffairs),accesstofinance(DepartmentofTrade
andIndustry,variousstateagencies),conducivelabourmarketregulation(Departmentof
Labour),soundindustrialpolicy(DepartmentofTradeandIndustry),economicplanningand
macropolicy(DepartmentofEconomicDevelopment,NationalTreasury),andappropriate
education,trainingandskillsdevelopment(DepartmentofHigherEducationandTraining,the
HumanResourcesDevelopmentCouncil,NSAandtheSETA).Thereareothergovernment
departmentsaswellasprovincialandmunicipalstructuresthatalsoplayarole.

Thefollowinganalysesshowhowthefourvariables
economicgrowthanddevelopment;
roleofthegovernment;
labourmarketchanges;and
landreform)
impactpositivelyornegativelyonthegrowthofthesectorandthedemandforskills.

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June2010

HIGHG
GROWTHS
SCENARIO
Theeconomicsofthesector

Roleofgovernment

Internationaltradeagreementsarestillweightedin
favourofUSandEUbutprogressisbeingmadeand
specificblockagesareaddressedinbilateraltalks
Theruraleconomygraduallyimproveswiththe
buyingpowerofthepoorincreasingandmorestable
marketscreatedforlocalproduce
ExportsincreaseinkeyareasidentifiedinIPAP2,and
theRandexchangeratestabilisesatalevelnottoo
muchdifferentthanitistoday

Rolesandintegrationofnationalgovernment
departmentsareclarified.Specificfunctionsare
agreed,processesputinplaceandpersonnel
appointedwiththerequiredskills
TherolesofDepartments(DWA,DAFF,DRDLR,DoL,
DTI,DED,DHET)areclarifiedwithappropriatejoint
plansandcoordinatingstructures
Foreachofthefunctionsagreedineachofthe
relateddepartmentsappropriatestructuresand
systemsareputinplaceandstafftrained
Specificcapacityisputinplaceatlocallevelto
supportimplementationoflandreformandrural
development

Thereisagrowingunderstandingoftheconceptof
dualismandtheneedtointervenewithlabour
absorptionanddevelopmentmechanisms
Anunderstandingisreachedontheroleofagencies
andlabourbrokersandabuseiscurbed
Somerelaxationoflabourmarketregulationsare
agreedthatmaintainsomeminimumstandardof
employmentbutassistabsorption
Mechanismsarefoundtoaddressskillsneedsinthe
contextofcasualandseasonalworkpatterns

Landclaimsareallfinallysettledandownershipand
tenureisresolved.Thereisaseriousdriveto
establisheffectiveagriculturalenterprises
The "willingbuyerwillingseller"approachisresolved
andenablesviablelandtobecomeblackowned
Landtransfertoblackandemergentfarmersisdone
inamannerthatintegratesthenintothesupply
chainsofthesector
Financingoflandreformandtransferisdoneonthe
basisofagreeddevelopmentplans,includingskills.

TheeconomyinSAandgloballycontinuestorevive,
albeitslowlyforthenextfewyears

Labourmarketreform

Trajectoryoflandreform

LOWG
GROWTHS
SCENARIO
Theeconomicsofthesector
Roleofgovernmentdepartments
TheeconomyinSAandgloballystagnatesatcurrent
levelsandtheeconomystrugglestopickupafterthe
temporary2010WorldCupboost
Internationaltradeagreementsarestillweightedin
favourofUSandEUandprotectionismincreasesasa
resultoftheglobalrecession
SAsGinicoefficientcontinuestoworsen,withrural
povertyincreasingandlocaleconomiesdeclining
Randvolatilitycausesproblemsforimportersand
exporters.Wellestablishedmarketsaremaintained
butexportsdecrease

Alackofpurposeatgovernmentlevelmeanslimited
progressforanotherfiveyears.Landreformremains
acommitmentwithoutaplan
TherolesofDepartments(DWA,DAFF,DRDLR,DoL,
DTI,DED,DHET)areunclearandthereisnoproper
coordination
Thereisalackofeffectivestructures,systemsand
processestoimplementpolicyacrossdepartments
Atlocallevelthedeclineintheagriculturalextension
officerfunctionscontinuesandlimitedpractical
supportisavailable

Understandingoftheruraleconomyissodiversethat
stakeholderscannotagreetheproblem,letalonethe
solutiontolowabsorptionlevels
Casuallabourandlabourbrokersremainsanissueof
dispute.Confrontationresultsinbitternessand
resentment
Labourmarketregulationcontinuestobea
contributingfactortoreducinglevelsofemployment
Unstableemploymentpatternsinthesectormake
skillsinterventionsdifficulttomanageandlargely
ineffective

Landclaimstaketoolongandlandreformprocesses
leavepotentiallyproductivelandpoorlydeveloped
andmanaged
Theimpassecausedbyarigidinterpretationsof
propertyclausesintheConstitutioncontinuestostall
achievementofthe30%blackownershiptarget
Blackownedfarmsfinditdifficulttobecomepartof
supplychainsandareunabletoperformadequately
Financingoflandreformandlandtransfercontinues
tobewastedasitisnottiedtothebuildingof
appropriatecapacity

Labourmarketreform

Trajectoryoflandreform

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AgriSETA

June2010

TheeconomicupturntriggeredbytheWorldCup
continuesandgloballythingsimproveenabling
anexpansionofexports.Thegovernment,
becauseofalackofintegratedpolicyplanning
andimplementation,provideslimitedsupport
forsectordevelopment.Thegainsgotothewell
establishedenterpriseowners,withfewgainsfor
emergingfarmersandlocalcommunities.

Governmentpolicyandsupport
Combinationofdisjointedgovernmentpolicy,
planningandaweakandincreasingly
marginalisedruraleconomy.Economic
conditionsresultinunsustainablefarming
conditionsandemploymentdeclinesalong
withproductivity.Foodshortagesandthelack
ofdevelopmentinruralareasleadingto
increasingsocialtensions.Aviciouscycle
developswiththesectorgoingintolongterm
decline.

Economicfactorsglobally,nationallyandlocally

Theseanalysescanbetranslatedintofourpotentialgrowthanddevelopmentscenariosforthe
agriculturalsectorwhicharebasedontherequirementsforastrong,developmentstate:

Scenario3:Weakgovernmentsupport
Scenario1:Integratedgovernment
andsoundeconomy
supportandsoundeconomy
Governmentdepartmentscoordinatetheir
effortstoachievemaximumimpact.Thereare
favourableeconomicconditionsthatcreate
opportunitiesforadvance.Withinthispositive
environmenttheroleoftheAgriSETAbecomesa
centralcomponentofacomprehensivestrategy
forgrowthandskillsinterventionsaretargeted
toachievemaximumeffect.Resultsingrowthin
sustainableenterprisesandexpanded
employmentopportunities.

Governmentpolicyandsupport
Governmentdepartmentscoordinatetheir
effortstoachievemaximumimpact.However
economicconditionshamperprogress.Efforts
bytheAgriSETAareunderminedbypoor
labourabsorptionandjobinsecurity.Some
significantsuccessesarerecordedincluding
someNSFfundedprojectsthatresultin
sustainableenterprises.Aplatformislaidfor
futureimprovementswhentheeconomic
conditionsimprove.

Scenario2:Strongstatebutweak
economy

Scenario4:Weakstateandeconomy

Agriculture:SectorAnalysis

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AgriSETA

SECTION 2:

June2010

DEMAND FOR SKILLS

AgriSETAregisteredemployersandemployeecoverage
In2009,17234employerswereregisteredwiththeAgriSETA,comprising
15394smallemployers(lessthan50employees)
1202mediumsizedemployers(50149employees)and
638largeemployers(morethan150employees).

Consideringthattherearearound40,000commercialfarms33 ,the17234employersrepresent
around43%ofcommercialfarms.Notwithstandingchangesinthesectorasaresultofland
reformandsectorshrinkage,thisisasizableproportionandisheldtobesufficiently
representativeforthepurposeofskillsdevelopmentplanning.

Howeverthispaintsanincompletepicture.Itunderstatestherepresentativenatureoflarge
enterpriseregisteredwiththeSETAandoverstatestherepresentativenatureofsmallregistered
enterprises.4175(24.2%)oftheenterprisesarelevypayingmembers.Further,only1673(11%)
workplaceskillsplans(WSPs)weresubmitted..

Table16:Registeredemployersbysizeandsubsector
Sub
sector

Description

Small

Processingandmarketingofcoffeeandteaincluding
Coffee/Tea
coconuts,cocoa,nuts,olives,dates,etc.
Fibre
Grading,ginning,packingofwoolandcottonrawmaterial
Fruitpackedincartons,fruitjuiceconcentratedrummedand
fruitjuiceincontainerreadyforconsumption
Fruit
Fruitexportersandimporters
Manufactureofgrainmillproductsandstarches
Handlingandstorageofgrain
Grain
Wholesale&retailtradeinAgriculturalmachinery
SaleanddistributionofAgriculturalrawmaterialsandother
farminginputs
Manufactureofflourandgrainmill products,includingrice
andvegetablemilling,grainmillresidues
Manufactureofpreparedanimalfeeds
Milling
Manufactureofpetfoods
Manufactureofstarchesandstarchproducts
Pest
control
Poultry

Primary

Employers
Medium

PestControl
Poultryandeggproductionincludingtheslaughtering,
dressingandpackingofpoultry
GrowingofCerealsandothercrops(notelsewhereclassified)
GrowingofVegetables,Horticulturalspecialties,nursery
products
GrowingofVegetables,Horticulturalspecialties(Including
OrnamentalHorticulture)andnurseryproducts.
Sugarplantationincludingsugarcaneandsugarbeetetc.

Large

33

1676

16

18

271

36

57

6
119
67
213

0
5
7
9

1
7
23
4

182

120

15

11

110
42
7

19
9
1

0
0
1

209

305

49

37

902

160

34

943

120

72

11

33

SARSstatistics,2007

Agriculture:SectorAnalysis

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AgriSETA

Sub

Redmeat

Seed
Sugar

June2010

Description

Employers

Growingoffruit,nuts,beverage,andspicecrops.
Farmingofcattle,sheep,goats,horses,asses,mules,and
hinnies;Dairyfarming.
Otheranimalfarming,productionofanimalproducts(NEC)
Ostrichfarming
Gamefarming
Growingofcropscombinedwithfarmingofanimals(Mixed
farming)
Growingofcoffeeandteaincludingcoconuts,cocoa,nuts,
olives,dates,etc.
Agriculturalandanimalhusbandryservices,except
veterinaryactivities
Otheranimalfarming(notelsewhereclassified)
Growingoftreesassecondcropbyfarmers
Fishing,operationoffishhatcheriesandfishfarm
Productionandanimalproducts(notelsewhereclassified)
Slaughtering,dressingandpackingoflivestock,including
poultryandsmallgameformeat.
Production,sale&marketingofAgriculturalbyproducts(e.g.
bones,hides)
Slaughtering,dressingandpackingoflivestock,including
smallgameformeatandprocessingofostrichproducts
WholesaletradeinAgriculturalrawmaterialsandlivestock
Transportoflivestockassupportingactivity
Agriculturalandlivestockresearch
Seedproductionandmarketing
Manufactureofsugarincludinggoldensyrupandcastor
sugar
Processinganddispatchingoftobacco
TOTALS

Tobacco

Source:AgriSETA,WSPdata

1795

255

143

2252

59

18

433
5
16

25
0
0

12
0
0

2920

256

109

438

22

11
126
913
6

1
18
10
0

1
4
6
0

317

40

17

61

193
224
215
149

7
0
9
12

10
0
3
6

45

21

46
15394

8
1202

6
638

Thelargestnumberofregisteredsmallandmediumenterprisesarefoundinthemixedfarming
subsector,whilemostlargeenterprisesareinthegrowingoffruit,nuts,beverageandspice
cropssubsector.

EmployeecoverageintheAgriSETA
Collectively,the17234employersregisteredwithAgriSETAemployedatotalof239076
employees.Thisrepresents39%oftheagriculturallabourforcein2009.

The1673employerswhosubmittedWSPsin2009employed97898employees,representing
41%ofthetotalnumberofpeopleemployedbyregisteredemployers.Whilethenumberof
registeredemployerssubmittingWSPsissmall(11%),theyemployasizeablenumberof
employeesandthepercentageofemployeesprovidesastatisticallysignificantsample.Thedata
forlargerenterprisesisstatisticallymuchmorerepresentativethanthatforsmallenterprises.

Agriculture:SectorAnalysis

28

AgriSETA

June2010

Table17:Numberofemployeesofregisteredemployersbysubsector
Sub
sector
Coffee/Tea
Fibre
Fruit

Grain

Milling

Pest
control
Poultry

Primary

Redmeat

Seed
Sugar
Tobacco

Subsectordescription
Processingandmarketingofcoffeeandteaincludingcoconuts,cocoa,
nuts,olives,dates,etc.
Grading,ginningandpackingofwoolandcottonrawmaterial
Fruitpackedincartons,fruitjuiceconcentratedrummedandfruitjuicein
containerreadyforconsumption
Fruitexportersandimporters
Manufactureofgrainmillproductsandstarches
Handlingandstorageofgrain
Wholesale&retailtradeinAgriculturalmachinery
SaleanddistributionofAgriculturalrawmaterialsandotherfarminginputs
Manufactureofflourandgrainmillproducts,includingriceandvegetable
milling,grainmillresidues
Manufactureofpreparedanimalfeeds
Manufactureofpetfoods
Manufactureofstarchesandstarchproducts
PestControl

483
6539
27661
212
133
18303
795
2898
3634
731
160
105
119

Poultryandeggproductionincludingtheslaughtering,dressingand
packingofpoultry
GrowingofCerealsandothercrops(notelsewhereclassified)
GrowingofVegetables,Horticulturalspecialtiesandnurseryproducts
GrowingofVegetables,Horticulturalspecialties(IncludingOrnamental
Horticulture)andnurseryproducts.
Sugarplantationincludingsugarcaneandsugarbeetetc.
Growingoffruit,nuts,beverage,andspicecrops.
Farmingofcattle,sheep,goats,horses,asses,mules,hinnies;Dairy
farming.
Otheranimalfarming,productionofanimalproducts(NEC)
Ostrichfarming
Gamefarming
Growingofcropscombinedwithfarmingofanimals(Mixedfarming)
Growingofcoffee&teaincludingcoconuts,cocoa,nuts,olives,dates,etc.
Agriculturalandanimalhusbandryservices,exceptveterinaryactivities
Otheranimalfarming(notelsewhereclassified)
Growingoftreesassecondcropbyfarmers
Fishing,operationoffishhatcheriesandfishfarm
Productionandanimalproducts(notelsewhereclassified)
Slaughtering,dressingandpackingoflivestock,includingpoultryandsmall
gameformeat.
Production,sale&marketingofAgriculturalbyproducts(e.g.bones,hides)
Slaughtering,dressingandpackingoflivestock,includingsmallgamefor
meatandprocessingofostrichproducts
WholesaletradeinAgriculturalrawmaterialsandlivestock
Transportoflivestockassupportingactivity
Agriculturalandlivestockresearch
Seedproductionandmarketing
Manufactureofsugarincludinggoldensyrupandcastorsugar
Processinganddispatchingoftobacco
Total

Agriculture:SectorAnalysis

Employees

19187
10104
37799
195
220
47043
3382
4203
0
0
28722
0
970
513
1294
1589
0
5128
116
0
1697
0
534
2127
10478
2002
239076

29

AgriSETA

June2010

Source:AgriSETA,WSPdata

AccordingtotheWSPanalysis,thesubsectorforthegrowingoffruit,nuts,beverageandspice
cropsemployedthelargestnumberofpeople.Insixsubsectors,thereareemployerswhodonot
employworkers.Theseareprobablyfamilybasedorganisationswherefamilymembershelpin
thebusinesswithoutdrawingasalary.Theseareintransportandlivestockresearch;slaughtering,
dressingandpackingoflivestock,includingpoultryandsmallgameformeat;growingofcoffee
andteaincludingcoconuts,cocoa,nuts,olives,datesetc;ostrichfarmingandgamefarming.

Table18:Employeedistributionbyprovince
Province
Employees
Percentage
EasternCape
18844
19.2%
FreeState
1946
2.0%
Gauteng
2788
2.8%
KwaZuluNatal
5416
5.5%
Mpumalanga
8062
8.2%
NorthWest
3290
3.4%
NorthernCape
5436
5.6%
Limpopo
1730
1.8%
WesternCape
50386
51.5%
GrandTotal
97898

Source:AgriSETA,WSPdata

OfthosesubmittingWSPs,registeredemployersintheWesternCapeemployedthelargest
numberofpeoplewhileemployersinLimpopoemployedtheleastnumberofemployees.Free
StatehasasmallnumberofemployeescoveredbyWSPssubmittedtotheSETA,whereasEastern
Cape,witharelativelysmallnumberofregisteredfarmshasaverylargenumberofemployeeson
farmssubmittingWSPs.Giventhisvariancebetweenprovinces,theuseofWSPdatafor
extrapolationpurposesmustbeviewedcautiously.
2009WSPequityinformationwasonlyprovidedforaboutaquarterofemployees(25637
or26%)34 .NoinformationwasavailablefromtheWSPsonnonSouthAfricansworkingon
commercialfarms.
Table19:Equityprofilefrom2009WSPdata
African
Coloured
M
F
D
M
F
D
8040 5785 38
5097 5228 24
58.0% 41.7% 0.3% 49.3% 50.5% 0.2%
13863
10349
54.1%
40.4%
TotalMale
13 970
54.5%

Indian
F
25
53.2%
47
0.2%
TotalEquity
TotalFemale
11 594
45.2%
M
22
46.8%

D
0
0.0%

M
811
58.9%

White
F
D
556
11
40.3% 0.8%
1378
5.4%

Totals

25637
100%

TotalDisability
73
0.3%

Source:AgriSETA,WSPdata

Usingcurrentlyavailabledataitisnotpossibletoprovidedisaggregatedemploymentdataby
subsector.Thiswillrequireasmallchangeinthewaythatgender,raceanddisabilitydatais

34

Someemployersdidnotcompleteraceandgenderinformationwhengivingtheiremploymentprofiles.

Agriculture:SectorAnalysis

30

AgriSETA

June2010

codifiedduringWSPdatacapturing,includingallocationbysubsector.Whatcanbestatedisthat
employmentofmalesismoredominantthanthatofwomen,andmoreAfricansareemployedin
thesectorthanothergroups.Employmentofpeoplewithdisabilitiesisbelow1%.

2.1 Skills demand

TheNationalEducationandTrainingStrategyforAgriculture(AETStrategy)
TheAETStrategydevelopedbytheDepartmentofAgriculture,FisheriesandForestry(in
consultationwithvariouskeystakeholdersintheagriculturalsector)highlightspriorityskills
needsandconstraintswithinthesectorandcategorisesneedswithinthefollowing5broadareas:
1. Agriculturalproductionrequestingthatthepastfocusonanarrowbandof
commodities(relevantmainlytothecommercialsector)andrelatedresearchbe
expandedtoaddresstheneedsofsmallscaleandsubsistencefarmers(e.g.morefocus
onmixedfarmingandrurallivelihoodsustainabilityskills)
2. Agriculturalengineeringwithspecificfocustobeplacedontechnologiessuitablefor
smallscalefarmers(e.g.relevantandpostharvestingtechniquesrelatedtoprocessing
andstorageofproduce)toaddressthisneedthescarcityofagriculturalengineers
requiresattention.
3. Agriculturaleconomicsacriticalneedwasidentifiedforgeneralagriculturaleconomic
skills(rangingspectrumoffarmplanning,farmmanagement,enterprisemanagement,
marketing,finance,etc.)withtheneedtotrainingbothfarmersandextensionofficersin
suchfields
4. Agriculturaldevelopmentaspecificneedwasidentifiedtodevelopagricultural
extensionistsinsupportingespeciallyemergingandsmallscalefarmersoverthefull
spectrum(aneedexistsforbothnewcurriculuminthetrainingofnewextensionistsand
theretrainingandupgradingofexistingofficers)
5. Veterinarianstheneedtodevelopstateveterinariansinorderforthestatetoperform
itsroleandfunction(particularlyinitspreventative,monitoringandregulatoryroleand
function)

AGRISETAsectorskillsplanningdemanddata(20082009)
ThefollowingsectionreflectsinitialresearchonskillsdemandintheAgriculturalsectorarising
fromthesectoranalysis(section1),previousAGRISETAskillsdemandresearchforSectorSkills
Planningduring20052009andanalysisofWSPdatafrom2009.

WiththeintroductionoftheOrganisingFrameworkofOccupationsandagreementondefinitions
forscarceandcriticalskillsin2005/06,theAGRISETAundertookanextensiveresearchand
consultationprocessestodetermineskillsdevelopmentprioritiesforthesector.

Theresearchmethodologyemployedwasbasedontheafourdimensionaltopologyfor
establishingandevaluatingskillsneeds,illustratedinthefigurebelow:

Agriculture:SectorAnalysis

31

AgriSETA

June2010

Figure4:Topologyforidentifyingskillsdevelopmentpriorities

RECRUITMENT
DIFFICULTY

Firmsexperiencedifficulty
recruiting.Thisdoesnot
necessaryimplyaskills
shortage mayindicatea
poorimage,remunerationetc
Image

SKILLS
GAP

SKILLS
SHORTAGE

Payconditions

Thosecurrentlyinwork do
nothavetherequisiteskills
settocarryouttheirjobtoan
optimumstandard

Requiredskillsareinshort
supplywhencomparedwith
thedemandacrossthewhole
labourmarket

Regardlessofskillslevels,a
situationexistswherethereis
simplynotenoughsupplyof
labourtomeetdemand

LABOUR
SHORTAGE

Source:AGRISETASSPAnnualUpdate,August2009

Theidentificationandprioritisationofskillsneedswasalsoundertakenfromakeystakeholder
andbeneficiaryperspective.Considerationwasgiventoneedsofthefollowinggroups:
Theunemployedhelpingthemgainand/orregainentrytothelabourmarket.
Theeconomicallyinactivehelpingthemtobecomeeconomicallyactive.
Schoolleavershelpingthemgainaccesstofurthereducationandtrainingopportunities
andthusfacilitatingtheirentrytothejobmarket.
Entrantstothejobmarketfacilitatingemploymentandintegrationintotheworkculture
andworkethic(improvingtheemployabilityofanindividual).
Thosecurrentlyemployedinthesectorincreasingtheircompetencyandopportunities
for advancement, creating a career path and offering continued job security,
enhancement of value adding to the sector, improving their prospects for better
employmentopportunities.
Organisationsandenterpriseswithinthesectormakingsurethatskillsdevelopmentand
knowledgecreationoccursinsuchawayastoimprovethesectorsviabilityandallowing
companies/enterprises to become more sustainable and profitable along the way,
improvingproductivity,competitivenessandinnovationwithinorganisations.

Inorganisingandreportingtheidentifiedpriorityskillsdevelopmentneeds(2008/09),the
followingstructuringapproachwasfollowed:

Tier1:ThefourcategoriesofneedsaspertheTopologypresentedabovewereusedfor
theidentification,evaluationandgroupingofneeds.
Agriculture:SectorAnalysis

32

AgriSETA

June2010

Tier2:Withineachofthefirsttiergroupings,needswerefurtherbrokendownandorganisedper
targetgroup.Atthissecondlevelneedsweregroupedby:

o Generalskillsdevelopmentneeds(crosscuttingoverdifferenttargetgroups)
o Needsexperiencedbysmallscalefarmers(thisgroupincludedsubsistence
farmers,newemerginglandreformbeneficiariesandsmallscaleAgriBEEfarmers)
o Needswithinthecommercialagriculturalsector(persubsectorgroupingswhere
specificneedsforsuchwereidentifiedbothonfarmneedsandwithinthe
secondarysubsectororrelatedagribusinesses)
o NeedsoftheDepartmentofAgriculture,FisheriesandForestry(DAFF)
Tofurtherguideanddirecttheidentificationandselectionofscarceandcriticalskills,the
followingfactorsorcriteriathatcouldreflecttheimportance(impactandeffect)ofaskills
shortagesweredevelopedasanidentificationframework:

1. BasicSkillsDevelopment
Promotingbasicliteracyandnumeracyandraisingthebaselevelofeducationforthe
sector,improvingtheworkandlivelihoodofexistingworkers.
2. Employability:
Makingtheemployeemoreemployablebyimprovingthefitbetweentheirskillsandthe
sectorneeds.
3. EnterpriseViability:
Improvingthecapabilityandfeasibilityoftheenterprisebyincreasingitseffectivenessof
orpossibilitiesforprofitgeneration,etc.
4. EnterpriseSustainability:
Allowenterprisestosurviveandgrowoveranextendedperiodoftimewithout
compromisingthevalueofrenewableresources,therebycreatinglongtermmeaningful
employmentforlargernumbersofpeople.
5. SectorGrowth:
Enablingthesectortodeveloporpursuenewopportunitiesorimprovetheeffectiveness
ofcurrentoperations.
6. SectorCompetitiveness:
Enablingthesectortocompetemoreeffectivelyintheinternationalarena,improving
marketintelligenceandinterpretation,productivity,costefficiency,etc.
7. HumanResourceDevelopmentCapacity:
Improvingtheaccesstoqualityprovisionoftrainingtotheagrisector.

Basedonthisresearchandconsultationframeworkthefollowingskillsdevelopmentneedsand
prioritieswereidentified:

Agriculture:SectorAnalysis

33

AgriSETA

June2010

GENERALNEEDS
Primaryagricultureis
theentrypointintothe
worldofworkforlarge
numbersofpeoplein
ruralareas.However,
thesectorhasnegative
connotationsamongst
sectionsoftheyouth
andinpartsofthe
countryandisviewedas
alastresortforsomein
thesearchfor
employment).The
effectisthatdespitean
unemploymentrateof
approximately26%
(nowover30%),farmers
finditdifficulttorecruit
workerstomeet
seasonaldemands.This
hasresultedinthe
governmentapproving
thecontractingof
foreignlabourtomeet
suchtemporaryneeds
(workersarerecruited
mainlyfromZimbabwe
andMozambique).

SMALLSCALEFARMER COMMERCIALSECTOR
NEEDS
NEEDS
RECRUITMENTRELATEDSKILLSNEEDS
Labourinthisfarming
Theagriculturalsector
sectorisprovided
stillmanagestoattract
primarilybyfamily
technicaland
membersandnoreal
managementskillsasit
recruitmentconstraints isperceivedtoincludea
canbeidentified
betterlifestyleandthere
isastrongtraditionof
agricultureinSA.
Increasingcrimerelated
securityrisksassociated
withfarmingmayhavea
negativeimpact.

DAFFNEEDS
TheDepartmenthas
identifiedanumberof
occupationsinwhich
theyareexperiencing
longtermvacancies.
Someoftheseresult
fromageneralshortage
ofsuchskillsinSA,while
othersarisefromthe
inabilityofthepublic
sectortocompetewith
theprivatesector(less
favourableemployment
image,working
conditionsandequity
considerations).
Priorityvacancies
include

SKILLSGAPSRELATEDNEEDS
FarmManagement
Acriticalconstraintis
Lowliteracyand
(Mainlyowners/
thepooreducational
numeracylevels
managers)
levelsofalarge
bothamongst
workerswithinthe
Farmmanagement& proportionofthe
labourforceinthe
sectoratlargeandat
entrepreneurship
sectordemandinga
owner/managerlevel Resource
considerableeffortand
inmanyofthesmall
managementand
investmentinABETand
scalefarming.
recordkeeping
otherlifeskills
Farmmanagement
Financialplanning
Agriculture:SectorAnalysis

Veterinarians
Agricultural
Engineers*
PlantHealth
Specialists*
Agricultural
Statisticians
PlantHealthPestRisk
Analysts*
ICTSpecialists
Agricultural
Economists
AgriculturalFoodand
Quarantine
Technicians*
Agrometeorologists*
PastureScientists*
PlantProduction
Specialists*
SpecialisedFood
Analysts

Aparticularlybigneed
existsforskillsupgrading
amongstExtension
Officersparticularly
withregardtoredress
thehistoricalneglectof
smallscalefarmersand
resourcestrapped
farmers.

34

AgriSETA

SMALLSCALEFARMER
NEEDS
skills(andgeneral
andmanagement
managementskillsin Projectmanagement
otheragricultural
Businessplan
businesses)coupled
development
withabusiness
Marketingand
orientationand
processing
entrepreneurship
Processingand
skills.
packaging
Ageneralneedto
Transport
increasecompliance
management
withenvironmental, Marketingproduce,
occupationalhealth
includingbranding
andsafety,animal
Planningfor
welfare,produce
marketing
safetyandhygiene
Knowledgeof
standards,
markets
regulationsand
Technicalknowledge
requirements(local
andskills
andinternational
Production
standards)
management
(relatedtospecific
enterprise)
Demonstrationof
production
techniques
Naturalresources
management
Mechanicalknowledge
Farmmaintenance
Repairsofmachinery
andequipment
Electrical
maintenanceand
installation
GENERALNEEDS

Generally,SAhasa
shortageof
entrepreneursand
peoplewhohavethe
businessacumen,drive,
motivationand
Agriculture:SectorAnalysis

COMMERCIALSECTOR
NEEDS
programmes.
Needforimproved
managementskillsand
relevanttechnological
knowledgefor
increasingproductivity
levelsandimproved
productionmethods.
Risingimportancefor
environmentally
responsibleproduction
andprocessing
managementsystems.
Risingcompetitiveand
internationalmarkets
increasesneedfor
businessand
marketingabilities
amongownersand
managers.
Increasing
requirementsfor
compliancewith
environmental,health
andsafety,and
internationaltrade
standards..
Informationtechnology
althoughnotapriority,
isincreasingin
importance.
Businessmanagement
abilityisbecoming
increasinglyimportant
asmorefarmersare
makingdecisionsabout
restructuringtheir
businesses,
diversificationand
developing
supplementarysources
ofincome.
SKILLSSHORTAGES
Theprofileofthese
Thecommercialagri
farmersreflectsalarge sectorwillincreasingly
contingentofolderand havetocompeteinthe
lesseducatedpeople
globalmarketandthe
whoaregenerallyless
everincreasingneedto
flexible,tendtostickto increaseproductivityto

June2010

DAFFNEEDS
Critically,improvedfarm
managementand
businessskillswithinan
agriculturalcontextto
supportthemajorityof
BEEandemerging
farmers.
Skillsupgrading
requirementsfor
existingExtension
Officersinclude:
Agricultural
economics
Agricultural
management
Businessand
financial
management
Technicaland
productionrelated
skillsincluding:
o Animalhusbandry
o Poultry
o Cropproduction
o Horticulture

DAFFusexperiencing
problemsareespecially
sourcingpeoplein
specialisedscience
relatedfields(learning
fieldsexperiencingfew

35

AgriSETA

SMALLSCALEFARMER
NEEDS
perseverancetobecome knownpracticesandare
asuccessfulfarmer.
lesslikelytoexperiment
Giventhehighrisks
withnewtechnology.
involvedinthe
Withinthistarget
agriculturalsector
group,candidateswith
(naturalelements
goodentrepreneurial
outsideonescontrol),
abilityarescarce.
theagrisectordoesnot Thereisaperceived
competesuccessfullyfor shortageofAgricultural
thisscarceresource.
Extensionistsand
Moreover,aswithother advisorstoassistthis
professionalandskilled targetgroup.However,
occupationsthereisa
alargepoolofyoung
tendencyforyounger
unemployedgraduates
qualifiedpeopleto
existswhocouldassist
movetourbanareas.
suchemergingfarmers
iftheyweremobilised
andmadeaccessibleto
farmers.Similarlythe
potentialpoolofretired
commercialfarmers
whocouldserveas
mentorstothistarget
group.
GENERALNEEDS

Agriculture:SectorAnalysis

June2010

COMMERCIALSECTOR
NEEDS
remainprofitableand
viable,itcanbestated
thatmanyoftheexisting
farmersandmanagers/
ownerslackbusiness
managementand
entrepreneurial
orientation.
Equitypolicyandthe
needtobecomeBEE
compliantrequiresthat
commercialenterprises
appointanddevelop
blackowners/directors
/managers.
Changinglocaland
globalconsumer
preferencesrequire
farmerstochange
traditionalfarming
methodsandpractices.
Skillsandknowledge
requirementsinclude:
Globalfoodand
internationalquality
standards
Producttraceability
requirements
Organicproduce
andproducts
Specificoccupations
identifiedasbeingin
shortsupplyare:
Production
Managers(food
processing)
Product
specialisationto
international
specifications
(researchskills)
Forkliftdrivers,
heavyvehicle/truck
driversandmobile
plantoperators
Experiencedand
competentartisans
(millwrights,
electricians,fitters

DAFFNEEDS
enrolmentsand/or
passratesatHET
institutionswiththe
resultthattoofew
qualifiedpersonscome
ontothelabour
market).Examplesof
suchskillsshortages
identifiedbythe
Departmentinclude:
AgriculturalEngineers
PlantHealth
Specialists
(Nematology,
Entomology,Plant
Pathology)
Statisticians
(specialised
agricultural
knowledge)
PlantHealthPest
RiskAnalysts
Agricultural
Economists
(productionand
resource
economists)
AgriculturalFood
andQuarantine
Technicians
Agrometeorologists
/Earlywarning
Specialists
PastureScientists
PlantProduction
Specialists(e.g.
ornamentalcrops,
hydroponics)
SpecialisedFood
Analysts(pesticide
residueanalysts,
processedfoodand
dairyanalysts,wine
andspiritanalysts)

36

AgriSETA

June2010

COMMERCIALSECTOR
DAFFNEEDS
NEEDS
andturners,
Agricultural
Equipment
Technicians
Pestandweed
controllers
Horticultural
specialists
LABOURSHORTAGESANDRELATEDSKILLSNEEDS
Givenanemploymentrateofsome26%(2009,currentlyestimatedatover30%,expandeddefinition),per
definitiontherecannotbealabourshortage..Itishowever,difficultforpeoplewhohaveneverworked
beforetointegrateintotheagriculturalsectorworkforce.Coupledwithanagingworkforce(3060%being
over40)meansthatmostagrienterpriseswill,withinthenext510years,belookingatreplacingalarge
proportionoftheirworkforce.Therecouldbeaninsufficientpoolofpeoplewillingandabletoparticipate.
TheimpactofHIV/AIDSisalsonotalwaysfactoredintounderstandingthediminishingpoolofresources
available.

Labourshortageshavebeenreportedwithinselectedgeographicalareasandinparticularoccupations.
Examplesincludecanecuttersinthesugarindustry,chickencatchersinthepoultryindustry,pickersinthe
fruitindustryandanimalhandlersinfeedlots,aswellasdairyparlourworkers.Itishoweverbelievedthat
theseshortagesmayreflectarecruitmentproblemasaresultoftheveryharshworkingconditionsand
therelativelypoorremuneration(whichmakestheseoccupationsunpopular).Atpresentsuch
shortagesareaddressedthroughcontractinglabourfromneighbouringcountries.
GENERALNEEDS

SMALLSCALEFARMER
NEEDS

AgriSETAWSPanalyses
Skills demand in the commercial agricultural sector
InformationfordemandforskillsfromWSPdataisavailablefor1673employerswhosubmitted
theirWSPsforthe2009/10period.ThetablebelowshowsdataonsubsectorWSPsubmission
relativetosizeofthesubsector,aswellassubsectordatafromallregisteredorganisationsand
thosewhosubmittedWSPs.Dataforregisteredemployersshowsthattherewere239076
employeesemployedbythe17234registeredorganisations.Aspreviouslystated,97898
employeeswereemployedbytheorganisationssubmittingWSPs.Thisconstitutes41%of
employeesemployedbyregisteredorganisations.

Agriculture:SectorAnalysis

7
34

9
34

71
65

4
12

WSPsreceivedas%ofsmall
enterprises

5
22

WSPsreceivedsmall
employers

23
2

WSPsreceivedas%of
medium&largeemployers

WSPreceivedmediumand
largeorgs

TotalWSPsreceived

33
1676

Mediumandlarge
employers(50+)

40
1710

TotalWSPsreceivedas%of
allregisteredemployers

Coffee/Tea
Fibre

Smallemployers(049)

Subsector

AllRegisteredEmployers

Table20:EmploymentandsubsectordatadrawnfromWSPanalyses

12
0.7

Employees
Per
Profile

483
6539

37

June2010

TotalWSPsreceived

TotalWSPsreceivedas%of
allregisteredemployers

WSPreceivedmediumand
largeorgs

371
648
335
213
391
12121
1107
167
71
60

277
581
279
209
305
10776
1018
149
45
46

94
67
56
4
86
1345
89
18
26
14

162
77
61
8
66
1144
70
24
13
5

44
12
18
4
17
9
6
14
18
8

76
48
35
2
46
513
45
13
10
3

81
72
63
50
53
38
51
72
38
21

86
29
26
6
20
631
25
11
3
2

31
5
9
3
7
6
2
7
7
4

27873
22129
4630
119
19187
136034
7475
2127
10478
2002

Totals

17234

15394

1840

1673

10

818

44

855

16

239076

WSPsreceivedsmall
employers

Mediumandlarge
employers(50+)

Fruit
Grain
Milling
PestControl
Poultry
Primary
Redmeat
Seed
Sugar
Tobacco

Subsector

WSPsreceivedas%of
medium&largeemployers

Smallemployers(049)

WSPsreceivedas%ofsmall
enterprises

AllRegisteredEmployers

AgriSETA

Employees
Per
Profile

Source1:AgriSETA,WSP2009data

Only10%ofallregisteredemployerssubmittedWSPsforthe2009/10period.Ofthese49%were
mediumandlargesizedemployersand51%small.However,only16%smallemployers
submittedtheirWSPsrelativetothenumberofregisteredsmallemployersand44%mediumand
largeemployerssubmittedWSPsrelativetothenumberofregisteredmediumandlarge
employers.Assuch,skillsdemandstatisticsprovidesmorerepresentativedataonthe
requirementsofmediumandlargeemployers.

Dataforskillsdemandinthecommercialagriculturalsectorisbasedondataforpermanent
employeesaswellascasualandseasonalemployees.

SkillsdemandforecastingbyAgriSETA
Forecastingforskillsdemand,theAgriSETAhasestimatedthatthedemandforskilledemployees
atdifferentlevelsinthenextfewyearsis510686.ThisisbasedonWSPdataanalysesoverthe
last5yearsandprojecteddemandfortheformal,commercialagriculturalsectorandfactoringin
thedemandthat,atmaximum,wouldresultfromcompletionofthelandrestitutionprogramme
inSouthAfrica.

Thetablebelowreflectstheskillsthatareondemandaswellastheestimatesfordemandover
thenextfiveyearsbymajoroccupationalcategory35 .

35

AgriSETA,2010

Agriculture:SectorAnalysis

38

AgriSETA

June2010

Table21:Demandforskillsbyoccupationalcategory
Group
1
2
3
5
6
7
8

MajorOccupation(OFO)
Title
Managers(commercialandsmall,emergingfarmers)
Professionals
TechniciansandTradeworkers
Clericalandadministrativeworkers
Salesworkers
Machineryoperatorsanddrivers
Elementaryworkers
Total

EstimatedDemand
264370
4141
8925
800
400
5800
226250
510686

Source:AgriSETA,WSPdataandSSPdemandforecasts

Researchneedsgoingforward
Ashasbeensetoutinthesectoranalysisandthescenariosderivedfromthatanalysis,thesector
isfacedbybothsignificantandprofoundchangeandalsogreatuncertainty.Itthereforefollows
thatthetaskoffocussinglimitedresources(basicallylevyincomeintheformalsectorandNSF
fundsfortheemergentfarmingsector)isdifficult.Whilstthegeneralthrustoftrainingremains
broadlyasdescribedinthe200610SSPUpdates,someconsiderableworkisrequiredtoachieve
targetedeffectiveinterventionsduringthe20112016period.

ThefollowingresearchquestionswillneedtobeaddressedinpreparingthenextSSP:

Inrelationtothemanagersandownermanagersofcommercialfarmsandenterprises,
whatskillsareneededtoenablethemtohelpbringaboutthemoreoptimisticscenario
andmanagetherisksassociatedwiththelessoptimisticones?
Intermsofprofessionalandtechnicalcompetencies,dothecurrenteducationand
traininginstitutions,coupledwiththelearningprogrammesavailablethroughthe
AgriSETA(learnerships,skillsprogrammesandthelike)meettheneedsofthesector?
Intheemergingagriculturalsectordothecurrentprogrammesfundedbysources
externaltotheAgriSETA(e.g.NSF)meetalltheidentifiedneeds?Whatgapsarethereand
howshouldtheybeaddressed?
Inrelationtogovernmentsgrowthstrategyandindustrialactionplans,whatskillsare
requiredfordevelopingtheaquaculturesubsector?Whatprogrammesareavailable?
HowcantheSETAsupporttheskillsneedsforthissubsector?
Giventheincreasinglevelsofcasualandcontractlabour,howcanskillsbedevelopedto
meettheneedsoftheformalcommercialsectorandtheemergingenterprisesector?
Howcanthedemandineachofthepriorityareasbequantifiedandagreementbe
reachedonnumbersofpeopletobetrained?

Agriculture:SectorAnalysis

39

AgriSETA

June2010

SECTION 3: Skills Gaps and scarce skills

ScarceskillsattheDAFF
ThelevelofscarceskillsatDAFFcanbedeterminedbythevacancyrate.Whiletheaverage
vacancyrateinthedepartmentasat31March2009was17%,thereweresomepoststhathad
veryhighvacancyratesasreflectedinthetablebelow.Indicatingthepossibilitythatthe
DepartmentisexperiencingdifficultiesinfindingsuitablecandidatesintheSouthAfricanlabour
markettofilltheseposts.

Table22:Scarceskilloccupationsandvacancyrates(DAFF,March2009)
Criticaloccupations
Agriculturalanimal,oceanography,forestryand
othersciences
Engineeringsciencesrelated
Engineersandrelatedprofessions
Farmingforestryadvisorsandfarmmanagers
Financeandeconomicsrelated
Horticulturists,foresters,agriculturalandforestry
technicians
Legalrelated
Mechanicalengineeringtechnicians
Riskmanagementandsecurityservices
Socialsciencesrelated
Veterinarians

Numberofposts

Postsfilled

Vacancyrate(%)

167

119

28.7

2
13
11
73

1
6
4
53

50
53.8
63.6
27.4

350

221

36.9

6
3
6
1
34

4
2
4
0
24

33.3
33.3
33.3
100
29.4

Source:DAFFAnnualReport,2008/2009

Skillsarealsoscarceatseniormanagementlevel.Thedepartmentalsoreportsondifficultiesit
hasfillingseniormanagementservicesvacancies,withsomeofthemstayingvacantforupto
twelvemonthsbecausenosuitablecandidatescanbefound.Thedepartmentwouldthenresort
toreadvertisementandheadhunting.Thiswasthecasewith22%of18SMSpostsinMarch
2009.

Scarceskillsinthecommercialsector
Thefollowingoccupationshavepreviouslybeenprojectedasscarce(extremelyhardtofill
vacancies)byAgriSETAinthecommercialagriculturalsectoroverthenextfiveyears.

Table23:Scarceandcriticalskillsinthecommercialagriculturalsector
Occupation
Code

Group

CriticalSkills

Intervention

Laboratory
Manager
Accountant
(General)

Technology,AI,
nutrition

HET

General

HET

139903

Managers

221101

Professionals

221102

Professionals

Management
Accountant

Farmfinancial
management

HET

222101

Professionals

Commodities
Trader

Export
administration,
supplychain

FET,
Learnership,
Skills

Agriculture:SectorAnalysis

Occupation

Comments

Focusonsupport,
advicetofarmers,
newenterprises

40

AgriSETA

Occupation
Code

Group

June2010

Occupation

CriticalSkills
management

224301

Professionals

Economist

233101

Professionals

Chemical
Engineer

233301

Professionals

Electrical
Engineer

233401

Professionals

Electronics
Engineer

233501

Professionals

233904

Professionals

233502

Professionals

233902

Professionals

311101

Techniciansand
tradesworkers

234102

Professionals

234201

Professionals

Chemical
processesin
foodproduction
Installationand
maintenance
Computerised
production
prosesses
Productivityand
efficiency

Industrial
Engineer
Instrument
Engineer
(Defence
Force)
Mechanical
Engineer
Agricultural
Engineer
Agricultural
Technician
Agricultural
Scientist
Chemist
Food
Technologist

Comments

Programme

HET

HET
HET

Mainlyfor
Departmentof
Agricultureand
parastatals,
commodity
organisations
Industriessuchas
sugarprocessing
Processingindustry
Processingindustry

HET
HET

Installationand
maintenance

HET

FET/HET

Farmlayoutand
infrastructure

HET

Installationand
maintenance

FET/HET

Agriresearch

HET/FET

HET

Foodsafety,
HACCP

FET/HET

234202

Professionals

234701

Professionals

Veterinarian

HET

311101

Techniciansand
tradesworkers

Agricultural
Technician

Farm
infrastructure

FET

311401

Techniciansand
tradesworkers

Chemistry
Technician

FET/HET

312907

Techniciansand
tradesworkers

FET
Learnership

312402

Techniciansand
tradesworkers

Weakstream,
productioninfra

FET/HET

Processingindustry
Notfordefence
sugarindustry

Equityreasons
Mainlyin
Government

Especiallyin
horticulture
Processingindustry
Acrosssector
Mainlyin
Government
Mainlyneededin
government
EEreasons

Chemical
Engineering
Technician
Electronic
Engineering
Technician

233904

Professionals

Instrument
Engineer
(Defence
Force)

321202

Techniciansand
tradesworkers

DieselMotor
Mechanic

321204

Techniciansand
tradesworkers

SmallEngine
Mechanic

Agricultural
equipment

Agriculture:SectorAnalysis

Agricultural

Intervention

Instrument
technician

FET

FET
Learnership
FET
Learnership

MainlyEEreasons

Mainlytobacco
industry
Occupation
needed:
Instrument
Technician(not
defenceforce).
Mainlysugar
processingsector
Toincludetractor
mechanic
Throughoutsector

41

AgriSETA

June2010

Occupation
Code

Group

Occupation

322301

Techniciansand
tradesworkers

Metal
Fabricator

Artisan

FET
Learnership

322303

Techniciansand
tradesworkers

Welder/
Welder(First
Class)

Artisan

FET
Learnership

323203

Techniciansand
tradesworkers

FitterWelder

Artisan

FET
Learnership

323202

Techniciansand
tradesworkers

FitterAnd
Turner

Artisan

FET
Learnership

323501

Techniciansand
tradesworkers

Millwright

Artisan

FET
Learnership

341101

Techniciansand
tradesworkers

Electrician
(General)

Artisan

FET
Learnership

Techniciansand
tradesworkers

Air
Conditioning
And
Refrigeration
Mechanic

342101

CriticalSkills

Artisan

Intervention

FET
Learnership

Comments

Mainlysugar
multiskilled
Tobaccoandsugar

Widespreadneed

Widespreadneed

Sugar,pack
houses,coldchain

Source:AgriSETASectorSkillsPlans

Supplyofskills
SouthAfricasagricultureskillsareproducedinhighschools,agriculturalcolleges,FETcolleges,
andHigherEducationinstitutions.Inhighschool,alargecohortoflearnerstakeAgricultural
Scienceasasubject.In2003,therewere42AgriculturalHighSchoolsofferingAgriculturalScience
asasubject.Thesestudentsandthoseinhighschoolstakingthesubjectcouldprogresstotaking
agricultureasafocusareaforfurthereducation.In2004,therewere10FETcollegesoffering
vocationallydirectedagriculturalprogrammes.TheseFETcollegesofferedcompletequalifications
andshortcourses.ElevenCollegesofAgriculturecanofferqualificationsuptodegreeleveland
19universitiesofferqualificationsinAgriculturerangingfromagriculturaleconomics,animaland
plantsciences,andhorticultureamongothers,atunderandpostgraduatelevels(Departmentof
Agriculture,2006).

Whilelongtermplanningofskillingofnewentrantsinthesectorcanbedonethroughclose
consultationbetweenthesector,agriculturalschoolsandcolleges,FETcollegesandHET
institutionssothattheyteachrelevantskills,thereareotheravenuesfortrainingforthosewho
arealreadyemployedinthesector,forexampleskillsprogrammesandlearnerships.Thereare15
registeredqualificationsfortheprimaryagriculturesubsectors.Currently,AgriSETAhas94
registeredlearnershipsthatcanaddresstheskillsneedsoftheidentifiedscarceskills.Theseare
capturedinAppendix2.

AgriSETAhasapproved/accreditedanumberoftrainingprovidersacrossthecountrytodeliverthe
theoreticalandpracticalcomponentsoftheselearnerships.Theseincludeagriculturalcolleges,FET
colleges,andprivateproviders.Currently,theAgriSETAhas246registeredandapprovedproviders
distributednationallyasfollows:

Agriculture:SectorAnalysis

42

AgriSETA

June2010

Table29:AgriSETAapprovedtrainingproviders(2010)
Province

Numberofproviders
72
(29%)
20
(8%)
35
(14%)
30
(12%)
3
(1%)
15
(6%)
14
(6%)
26
(11%)
31
(13%)
246

Gauteng
KwaZuluNatal
Limpopo
NorthWest
NorthernCape
FreeState
Mpumalanga
WesternCape
EasternCape
Total

Theprovidersaresmalltolargeorganisations.Inprimaryagriculturesmallprovidersappearto
offerthemosttraininginruralareasandcommunityprojects(AgriSETA,2010).Mostofthe
operatingproviderswillbeinFETcollegesandagriculturalcolleges.

TheAgriSETAisunabletomeetthetotaldemandsforskillsacrossthedualityoftheirsector.
Thereseemstobefairnessintheapprovaloftrainingforbothpermanentandcasualand
seasonalworkers.In2008/09,theAgriSETAapproved559learnershipsasfollows:

Table30:AgriSETAlearnershipsapprovedforgrantpurposes(20082009)

Source:AgriSETA,learnershipdataanalysis

Agriculture:SectorAnalysis

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AgriSETA

June2010

Provisionofskillsprogrammesinthesameyearattractedgrantsfor2706employees.

Table31:ParticipationbylearnersinskillsprogrammesintheAgriSETA(2008/09)

Source:AgriSETA,Skillsprogrammesdataanalysis

Agriculture:SectorAnalysis

44

AgriSETA

June2010

APPENDIX 1: Skills demand in the Department of Agriculture, Forestry & Fisheries (2008/09)

Source:DAFFAnnualReport,200820009

Agriculture:SectorAnalysis

45

AgriSETA

Appendix 2:

June2010

AgriSETA registered learnerships

RegisteredLearnership
LearnershipinAgriSalesandService
Learnership:AgriculturalMachineryTechnician
LearnershipinSpecialistAgriculturalMachineryTechnician
AgriTradeProcesses
FETC:MeatExamination:ApplyingBasicBusinessPrinciples
FurtherEducationandTrainingCertificate:SeedMarketing:ExecuteSeedTrials
FurtherEducationandTrainingCertificate:SeedResearchandDevelopment:CertifyasSeedUnit
FETC:SeedResearchandDevelopment:ConductaFieldInspectionofaSeedUnit
SeedResearchandDevelopmentOperations:OperateinaTeam
SeedResearchandDevelopmentOperations:ApplyBasicBusinessPrinciples
NationalCertificate:SeedProcessingandPackaging:OperateinaTeam
SugarIndustryTechnicalMaintenanceworker
NationalCertificate:SugarManufacturingandRefiningTechnicalMaintenance
FurtherEducationandTrainingCertificate:ManufacturingTechnicalMaintenance:
ProduceComponentsbyPerformingEngineeringTurningOperations
FETC:ManufacturingTechnicalMaintenance: ProduceComponentsbyPerformingMillingOperations
FETC:ManufacturingTechnicalMaintenance: DevelopandFabricatefromComplexDrawing
NationalCertificateinSugarTechnology
FurtherEducationandTrainingCertificate:Sugar Processing
NationalCertificateinSugarTechnologyProcessing:SugarRefining
NationalCertificateinSugarTechnologyProcessing:JuicePreparation
NationalCertificateinSugarTechnologyProcessing:Crystallisation
NationalCertificateinSugarTechnologyProcessing:LaboratoryPractice
NationalCertificateinSugarTechnologyProcessing:Extraction
NC:RooibosProduction:ApplyingBasicBusinessPrinciples
NC:RooibosProcessing:ApplyingBasicBusinessPrinciples
NationalCertificate:CigaretteProduction

NQFLevel
4
2
5
2
4
4
4
4
3
3
3
2
3
4

SAQARegistrationNo
22Q220001201784
22Q220007201602
22Q220009212585
22Q220013301252
30Q300028231644
22Q220025211264
22Q220027211214
22Q220028201204
22Q220020221213
22Q220021221213
22Q220026211233
22Q220011391282
30Q300003231463
30Q300013211734

4
4
5
4
2
2
2
2
2
2
2
3

30Q300015211734
30Q300014201734
22Q220036221405
22Q220035311444
22Q220037281242
22Q220038281242
22Q220039271222
22Q220040251242
22Q220041281222
30Q300024271302
30Q300022241232
22Q220046231213

Agriculture:SectorAnalysis

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AgriSETA

June2010

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