 Welcome to the farming podcast brought to you by Private Property. My name is Mbalin Walker and I am your host today. I am joined by Dr. Svisso Ndombela today, speaking about the South African landscape, South African farming landscape, to be exact. Dr. Svisso is a trade economist at the National Agricultural Marketing Council, and I felt it best to have a chat with him today because he's someone that's quite well-versed in this sector, very respected in the agricultural sector as well, and also a contributor to the Farmers Weekly magazine. So Dr. Svisso, thank you for joining us. How are you doing? I'm doing all right and thank you very much and good afternoon to you and good afternoon to your listeners. Likewise, I know you're a very busy person, so thank you for allowing the time to speak to us today. I think just for a point of reference for individuals that don't know you, what is the National Agricultural Marketing Council and what is your role and responsibility within the organisation? The National Agricultural Marketing Council is the state-owned entity that is reporting to the Department of Agriculture, Land Reform and Royal Development, which is tasked in providing policy advisory to the Minister of Agriculture, as well as the directly affected groups. And my role within the National Agriculture Marketing Council is that I'm employed as the Chief Economist. Basically, I'm responsible for the economic modelling research as well as trade related policy advisory within the Department. Okay, awesome. So in your view, I know agriculture is very talked about topic and subject, especially today with all these farm murders that are happening in the country, etc. So I think and also being in lockdown, how has the agricultural sector been affected or impacted by the lockdown in your view? I think when it comes to agriculture, it's a mixed bag of feelings. Broadly, one could easily say agriculture is probably one of the sector that is less affected in comparison with other economic sectors because it was said that it was declared essential services. It was allowed to continue operating. Most of even the operations in the sector were less interrupted in comparison with other sectors. But if you drill deeper within the sector itself, there are specific industries that were significantly impacted. Whether you're looking at the alcohol related industries like the wine, barley, which are wine grapes that supplies for wine and barley, which is in the beer, because of the alcohol ban, those industries were badly affected. But there are also other industries like the flurry culture, because it's a perishable product that was also impacted in that sense. But the majority of them were mainly impacted from the demand side because of your tourism that usually produce, procure a lot of product that we produce as an input into a sector. And that had a spillover effect into the agriculture because of the pricing across the range of product was significantly impacted. So there was not demand before. And then there were just some isolated cases like fresh produce not operating in the animal industry. Auctions were impacted. So those were sort of I could say minor to moderate interruption that have happened. But it is safe to say because of regulations, the sector in its aggregate form, it was relatively well insulated and they was able to provide food. Okay, thank you for those insights. You mentioned that the national agricultural marketing council also advised parliament on certain agricultural issues. And considering that we are still in lockdown, we are still facing and experiencing a global pandemic, you've highlighted a few sectors within the agricultural industry that have been impacted or not impacted. As an organization, as an entity, the NAMC, what are some of the interventions that you are advising the policy makers right now to obviously ensure the longevity of the agricultural sector, especially those that have been affected? You mentioned the barley, the horticultural sector from a demand perspective. So what are some of the interventions that you are advising on those that are in policy making right now for the longevity of the sector going forward without obviously disclosing any important things that you can't release or discuss right now because I'm asking, the reason why I'm asking this is because we want to know as farmers, you know, in terms of how the sector is going to be supported going forward post COVID-19. Well, it's interesting, but as you said, and we are all eagerly waiting for a president this afternoon to tell us what is the recovery plan for the country going forward. And we must certainly show that agriculture is one of those sectors that will feature in predominant in the president's plan. But I think coming back to that, one of the policy advisers that we constantly tried to share with the policy makers is that in the short term, you've got to be able to provide a specific support into the, whether it's commercial farming, because agriculture sector, the biggest problem is that it's a dualistic in nature. So even the design, the support that your large commercial guys will need is in some part different from your small holder farmers or your subsistence farmers that they will need. So it's always important to strike the balance between the two. So if you allow me to just basically dive into that is that in the near term, what is important is to how do you provide, particularly around the financial relief into your commercial guys that have been impacted significantly in terms of their income operation? So there are even some discussion ways, some sort of the relief fund that will be distributed through the land bank in collaboration with the department, which can target those farmers that were significantly impacted from the income side in the near term. So there will be announcement, I think in the short term, when the minister earlier on announced that he did mention that there will be certain fund that will set aside for those commercial farmers to do. But also for the small holder farmers themselves to expand the relief program that was initially expanded, because you will see that the relief problem also had certain exclusion criterias that tend to exclude other farmers that were not supported, but not also all the farmers were supported in the first round of that relief fund. So there's a need to expand that, of course, all these things are also dependent on the resource availability, particularly on the state, given that there's limitation around it. But so those are the immediate near tempting. I think what is very important in Bali, is that when you're looking at agriculture, and if you really goes back to what you said, to say going forward and really unlocking the true value and growth of the sector, and be able to also provide a certain benefit of the sector, it is important that we focus on support that will be able to deal with the structural issues that are not new, that were actually existing before the COVID happened in the agrar sector. So unless we are able to really focus most of our attention and our limited resources to those structural issues, only then we can provide a support. And what are those that we don't talk at a very high level? Is the issue of how do you expand access to land? And not only land water as well, because the land must have water rights. So the rapid release of land is starting with the one that the state already owns, but going beyond that as well, including the communal land system and providing the system. So even issues like the recorded rights of the communal land, but the rapid release of land into the deserving with a clear beneficiary selection strategy so that people can know. It's one of the key issues that needs to be focused. The issue of access to credit, and affordable credit for that matter, needs to be faster. So how do you reposition your land bank? How do you come up with even support of your commodity organization, including the new commodity organization that focuses permanently on the black farmers, like your sagras, your saftas in the sugar, and other areas in the poultry and other commodities? So those are very key. The other area which we advise them to say there must be some resources and schemes that are provided in that. Is the issue of extension services? Is the issue of research and development so that you can able to access into those services? But also the issue of markets, setting up the market, even the market of takers, and then assisting them, even all the farmers to even access your institutional market using your state procurement as a lever to aggregate that market point. So for me, I think in the near term there is those funds which is mainly in the relief fund, but from immediate sort of to the medium term, you have to be able to focus on the structural issues that have always been there. We've just been skating on them on the surfaces and until we break them down and provide the support that is needed, only then farmers can then be able to be sustainable as you rightfully said. They need to be a sustainable. I agree with you. And just before I proceed to respond to that is just to encourage anybody, the audience watching that this is a live recording. So feel free to ask any questions and please be part of the conversation. Dr. Spicer, in what you said, I completely agree as a farmer myself. I think it's not enough to just provide farmers land, but there's so many other structural issues along the value chain that a lot of farmers need assistance with. I mean, you see a number of other sectors are being supported in a great deal. And indeed before lockdown, farmers still had many problems of land accessibility. The length of the time it takes to really transition their farms into a farm that is fully operational with water rights. That just takes time, the applications and the process thereof. Market access, the linkages, infrastructure, logistics. We're looking at our power supply at the moment, which is not stable, which is affecting a lot of agricultural production as well. So yeah, there's so many other factors and dynamics that are really causing a threat to the industry over and above climate change. So I'm glad that these fundamental issues are still a topic of discussion. I think much intervention still needs to be done, whether this was before the global pandemic or post-COVID. I think it's really a priority aspect. And I know with the many farmers that have inherited land or being redistributed land from the government, they have said that just land and own is enough because there's so much that goes into making that land an asset of value, a working asset, a working and viable business, which fundamentally requires immense amount of capital. And the fact that farming is not getting cheap year on year, input cost arising, machinery, tools, all these infrastructure that is required from farmers to farm sustainably to stay ahead of competitive markets. All those interventions don't come cheap. So yeah, land loan is not enough. But I just want to say with a lot of talk now in the space of COVID-19 and businesses saying what is the new normal post lockdown, post-COVID? And a lot of companies are trying to deploy many interventions to ensure that they're still in business tomorrow. What advice would you give to the farmers that they should implement or what intervention should farmers implement, given the fact that you still got a long way to go with all these other aspects that are hindering a number of farmer successes? But from your perspective, what interventions do you think that farmers should adopt within their farming operations post the pandemic to ensure that their businesses are sustainable in the future? One of the things which we're seeing and what would likely be the new normal is that the traditional production means of doing things in agriculture will not necessarily sustain any farmer on the farm. So from the consumer perspective, you're seeing that more consumers want to have a knowledge of how the product is being produced. So your ethical trading systems, your compliance into your technical barriers to trade like how you manage your climate, how you manage your environment. So those things are more and more becoming important as part of the features and the branding of the product so that it can appeal into the market. So it has to fit in in the decision making process of a farmer when he plans his product, how he keeps his records, how he comply with his certification that is required by the market. But also the level at which farmers are adopted into technology will also determine their sustainability and the level of survival going forward. And by technology we not only basically referring to creating a new tractor or a new planting equipment or other areas but also your biological assets which is your cultivars that are adapted into the soils and into the areas which we're talking about and getting access into the varieties that uses less water as we know we are water scarce country and that is also adapting to the change in climate as you've said. Those are the decisions that the farmers will have to really think carefully before you even invest into your next biological asset or replacement of the product, particularly for those that are in the perennial crop kind of plantations such as fruits and nuts products on this one. But I think another important issue which we need to talk about is to familiarize ourselves as farmers in terms of your skilling and understanding the change in climate that is around yourself where you are farming into these places because farming is becoming now a big data-driven enterprise and if you don't invest in that big data to make your decisions you're likely to lose in terms of the opportunities that will come along in the farming space in the sector. So those for me will be one of the key issues that the farmers will have to take into account now when they make their decisions and when they plan their farming operations for the future. But lastly you're seeing and this with change of technology and the new normal of people social distancing is that the relationship between the farmer and the consumer it's narrow it's narrowing. So how you engage with your consumers how you take them into your farm without necessarily physically them being in your farm visually being able to do that it will one of the selling point that the farmers will have to do so that you raise this awareness of the farming and you use the consumers to be able to also link and supply the product directly. We are likely to see that the traditional way of distributing food through your your big cooperatives retailing and the distribution centers will continue to be the operational model but there will be this new market where you are able to have an opportunity to supply them directly and your logistical components then that you link with it which creates both new opportunities but also create challenges because if you do not have capital to captain to those opportunities they will pass you through. So those are the trends that will really change and reform the manner in which we have always known the farming space. Awesome I like the fact that you mentioned opportunities because that was going to be my next question in terms of I know that the National Agricultural Marketing Council does a lot of research on the ground and provides releases a number of stats I think quarterly etc or yearly so what what are some of the opportunities within the agricultural sector in the farming landscape that is available for not only farmers but investors and new entrant farmers in the sector. So what are some of the those opportunities looking like and also what are the fast growing commodities in the sector right now that many individuals can take advantage of? So in the last 10 years through the last five years or so nobody has come close in terms of growth numbers as we refer to guys particularly your citrus but of course these are the commodities that have a very high entry cost I mean typically to getting into the fruit space you need about a million rent just doing over one hectare to invest and be able to do that and you need over about 50 hectares to be a viable enterprise there but because they are export-oriented in South Africa because of its very diverse climate it's able to provide that sweetness with a very balanced chemical reaction into these kind of products so fruits in terms of those that have the masses and be able to get into it remains the very lucrative product and with South Africa very strongly promoting expansion of markets and excess condition to those markets particularly if you're looking into the South Asia markets and the Middle East but also the new in the in the new growth that we're seeing in the in the Africa through the African continent fruit remains the big product that you can invest on and there are also these niche fruit products such as your blueberries that are coming up complementing your traditional citrus, table grapes and other products but very key which we offer. Hi Dr. Spiso can you hear me? I think we might have lost Dr. Spiso and don't be there. I will just give him a few seconds to reconnect. Thank you for joining us once again apologies for that technical error. Dr. Spiso you were commenting on the aspect of different farming opportunities and you highlighted a couple of factors that you know the citrus industry is one that is fast growing they have sort of led the way in the agricultural sector in terms of really taking advantage of many opportunities that are presented to them particularly from an exporting perspective you said Asia and Europe has a huge interest within the South African citrus industry so please just expand a bit on your point prior to you getting cut there. Thanks very much again and apologies for that technical glitches there. I was explaining that in terms of the export those products still remain your biggest opportunity but also in terms of your nuts such as your market demand nuts and as well as pecan nuts particularly in the also areas that in the eastern Cape and part of Poznan, Natalia and part of Malanga those farmers can tap into those markets but I think for me the biggest opportunities we do often don't talk about which also became very clear in terms of the opportunities that are demanded in the domestic market and the importance of a domestic market during the COVID-19 when we saw that how important the domestic market is. Now when you think about that some of your industrial crops the revival of the coating the looking at a sugarcane not in a different form and I specifically say sugarcane not sugar because sugar is just one of the byproducts of sugarcane but sugarcane has so many products that you can generate out of it where the farmers want to also adventure in into the bioenergy space we know the country wants to move from the cold generated intensive electricity towards your renewable low-carbon economy and sugarcane and under industrial crops are one of the potential products that means to be looked at and the different bioenergy product that you can generate out of your that sugarcane similar in terms of your cannabis that is coming out and how can it really be used as a spring board to even drive the transformation and opportunities for the new players coming into the village and I think those are the products that has massive opportunities and it is up to every social partner in the country whether you're looking at the government policymakers you look at them investors to say can we use these new opportunities to ensure that we change the landscape of the architecture going forward but of course livestock products remain a key product and these are the products almost every household have access and they know how to produce it whether you're looking at your poultry industry and how the poultry also in terms of not only supplying as meat but you can process it into coconut and send it into your um made in these countries you can send it into some of the europe countries and those are the opportunities that lies in the country that we have to look at them so in essence what I'm saying is that whether you're looking at the horticultural space or in the grain space or in the livestock if you are able to identify a product but you ensure that you don't only play in in the crime unlevered you are able to migrate into the downscale part of the agro processing of that product it is only then where farmers really have the opportunities to drive it and localizing these systems in the different provinces of our country it's a golden opportunities for the young guys and for the young farmers out there who have eager to come in into this so those are the opportunities in my view that I'm thinking and as a last point which I'm really emphasizing this product whether you're looking at the goat farming in the eastern northern eastern coastal part of the country that when you're looking at the climate change numbers it shows that that part of the country will become more wet and more land capability potential will increase as the climate change changes so in these are the areas where majority of the farmers that are resource poor are currently sitting so identifying these opportunities and adapting to these technologies will put them in the better position to take those opportunities in the future. You've made some very valid points there and highlighted a vast range of opportunities from citrus to blueberries to nuts, macadamia and also the sugar industry and sugar cane most particularly and then also going into the renewable energy. I think all of those are fantastic opportunities but you know to tap into those that are hardly not discussed and I specifically want to speak about that oil processing space the sugar cane space and being a farmer myself Dr. Spiso realistically speaking it sounds so fantastic great you know that these opportunity exists for many players including farmers like myself and potentially investors but I want to speak on the entrepreneurs or the farmers who want to adopt value adding systems in their in their in their farm operations to tap into these opportunities is their support from a from a corporate South Africa level from organizations like yourselves the NAMC up all the way through to government that will help that farmers become successful in these very niche industries to say so because if we cannot get the simple things right like water license land market access etc and we're now delving into these very high-end niche high capital intensive industries can it become a success can all those opportunities really accessible to to the local domestic market but I wish I could say a different answer with the one I'm going to deliver now but you are absolutely right all these opportunities will only opportunities on the paper if we do not deal with the structural issues which have spoken about earlier on in my discussion and unless we are able to revive the capacity of the institution that is able to generate this knowledge and disseminate it into farmers it will just be an unrealistic opportunity and especially it's maybe less qualified it's an unrealistic opportunity for majority of the farmers but you'll still be an opportunity that can be created by those that are resource rich and that have access to acquire these information through private needs and that's not a sustainable way of growing the country if you want to do that because you want to make sure that opportunities are accessible to a broader range of farmers and academia in the sector and I repeat again unless the institution that are a task with the with the functions of creating effective and accessible innovation and research such as your ERC your OVP in terms of the animal space your NMC in terms of generating the information and the marketing and the marketing schemes that can be able to access all this if you're talking about that cannot be realized but even in within the directories in different departments and the you talk about land you talk about water but also some of the software infrastructure accessing registration being a farmer or having exported a permit or any other permits all these compliance issues which takes years and two months and some time and is a very tedious process all those needs to be done in different and I always make this point I'm going to say all these things that we're talking about and the importance of reviving these institutions they were there before 1996 before we deregulated the market and while deregulation is the best thing that has happened in the democratic dispensation it is important to understand that some of the functions that were privatized are actually essential for the revival and strengthening of the sector and making sure that the farmers take charge of these opportunities we're talking about but we must also make sure that some of the assumptions in designing some of the programs were not necessarily taken into account the ground realities that are faced by a farmer like yourself on the ground so some of these programs are designed with the with the with the with the with the understanding that is not in reality in in check and in sync with what the farmers face on the ground a simple thing such as understanding that if you release a program majority of the farmers don't even have access to internet don't even access to computer so some of these programs requires a very strong and previous qualification criteria which basically on its own exclude most of the farmers we're talking about even issues of the banking where you're saying that the farmer must have five years of experience of credible strength of in terms of the balance sheet which majority don't have them so I go back to that thing to say that the intervention that are even coming up and hopefully would come into the agriculture and other horses and master plan as well as the recovery boat is really to go back to the basics before you even make the policy and the institution you understand that you review them are they really designing these things and talking about these things take into account the realities that are faced by the farmers on the ground or we just promoting them using international standard and essential model that are not practical on the ground or the certificate form and that is a challenge that is really for not only for the policy makers but also for the investors and industry captains who sometimes sit with the policy makers in designing this program so we do not only talk about these opportunities but majority of farmers says but how do I access that because even if I try to access that I'm unable to I must emphasize there's a last point there that there are industries even in the corporate world that are really doing their best with limited resources and space to really expand these opportunities into the farmers particularly even the smaller order farmers you do have even big cooperatives that have your supplier development program that are designed to encourage the participation into the village but in that nature they are very ad hoc they are very you know natural and they will not have a bigger impact and we're saying the bigger impact is to review these structural issues first then the projects and the opportunities become accessible by every farmer on the ground well thank you Dr. Suisse I think you've said a mouthful there um and um yeah I think some of the points that you've mentioned can definitely be expanded much further in greater detail and I really commend you guys for the work that you're doing on the ground and even from a higher level from a strategic point of view in trying to advise parliament those and policy making decisions to really look at things holistically and not from a one-sided approach from an association point of view or from a government point of view but also collaborate and get inputs and insights from farmers because everything that you've raised and everything that we've discussed today really touches the farmer at heart there's fantastic opportunities that that exists within the South African agricultural sector but entrepreneurs farmers investors can't access them because of certain glitches in or certain uh factors that hinder us in the market to fully tap into that spaces and also it provides a gap you know so that those that have surplus funds can tap into those opportunities but then those that really can't afford to invest or improve their farming operations to such value-adding strategies then we're left behind so therefore it's creating a further gap in the market for those that can afford and those that can't and so I think um going back to the initial point she raised is that from an agricultural landscape especially in South Africa yes we might be a strong rural established industry in South Africa as opposed to the african other african markets however there's still a long way to go to ensure transformation inclusivity of different farmers at different levels and different sizes of their farms and also we still need to tackle issues like land water market access uh most importantly also extension services so that we could go having said that just to sum up our conversation um are there any final words that you would like to leave us with today um but i'm not sure uh what's happening on my screen like it's expanding your face my really last words and is a a serious point to point about for the very longest time in the South Africa we've been very much driven by this concept to say the small holder farmers needs to be commercialized so that they can become really big industrialized farmers and I think in the men in which we think about the agraric sector the men in which we think about our policies the men in which we think about our programs the men in which these institutions also design their financing solutions solution and support to farmers has to recognize that you can't be able to have a core a core existence of your commercial um of your large big industrialized farmers as well as your small holder farmers both that are black and white or or any other racial in terms of the small holder farmers that can coexist and the support and the design for the two groups are completely different and we in South Africa I'm always strong view that we need for as long as both the small holder farmer and the commercial farmer is in is adopting the principle of of competitive farming on market driven business planning as well as environmental friendly and ethical and and sustaining the environment we are able to move forward and there is a need to seriously relook at our policy formulation processes we relook at our institution that are tasked with those policies and as well as all these other partnerships that you promote was certainly private public partnership is the model that can work but we have to be able to see those private public partnerships are not exploitational in nature and they benefit as well and for me that is a way to say my last point that South Africa need both large and small holder farmers and that symbiosis model can really work but we need to be able to make clear that the support measures given for the two groups are totally different so that it takes into the realities that they face and up until we we admit that reality and start looking to that place only then all these opportunities you're talking about would be a reality for everyone and it's only then we are able to deal with security I thank you very much for your time thank you Dr. Suissel Dombella thank you for for giving us your time today and I really appreciate it thank you thank you very much I had a fun go back now but I have to run to catch my my my lunch