OVERVIEW Agriculture A
OVERVIEW Agriculture A new cold-storage facility at Dube TradePort is good news for farmers. SECTOR INSIGHTS • Operation Vula will make co-operatives stronger. The Premier of KwaZulu-Natal, Willies Mchunu, has committed his government to Operation Vula which aims to create economic opportunities for social enterprises and co-operatives, led by African people. They are to benefit from state-led infrastructure programmes, as well as from the buying power of the state through the supply chain. Another initiative to support small-scale farmers resulted in the Masisizane Fund investing more than R100-million in the Harry Gwala and Alfred Nzo districts. Consulting company Agriculture House will assess the effectiveness of the programme. Despite a long drought which recently ended, the province's agricultural sector is very strong, taking advantage as it does of the province's fertile and varied soils. Eighteen percent of KwaZulu-Natal’s 6.5-million hectares of agricultural land is arable and the balance is suitable for the rearing of livestock. Vegetables grow well in most areas, and some maize is grown in the north-west. Nuts such as pecan and macadamia thrive. The province’s forests occur mostly in the southern and northern edges of the province. The sugar sector is dealt with separately in this publication. The opening of a R99-million cold-storage facility at the Dube TradePort in 2017 gives farmers and exporters additional flexibility, ONLINE RESOURCES KwaZulu-Natal Agricultural Union: www.kwanalu.co.za KwaZulu-Natal Department of Agricultureand Rural Development: www.kzndard.gov.za National Department of Agriculture, Forestry and Fisheries: www.daff.gov.za allowing them to store chilled and frozen perishable goods. TWK is a R6-billion operation that originated in forestry (as Transvaal Wattlegrowers Co-operative) but which is now a diverse agricultural company with seven operating divisions. The coastal areas lend themselves to sugar production and fruit growing, with subtropical fruits doing particularly well in the north. KwaZulu- Natal produces 7% of South Africa’s citrus fruit. The Coastal Farmers Cooperative represents 1 400 farmers. Beef originates mainly in the Highveld and Midlands areas, with dairy production being undertaken in the Midlands and south. The province produces 18% of South Africa’s milk. KwaZulu-Natal’s subsistence farmers hold 1.5-million cattle, which represents 55% of the provincial beef herd, and their goat herds account for 74% of the province’s stock. The Midlands is also home to some of the country’s finest racehorse stud farms. The area around Camperdown is one of the country’s most important areas for pig farming. Enterprise iLembe, the development arm of the iLembe District Municipality, is looking for investors to further develop an agri-processing hub near the King Shaka International Airport and Dube TradePort. KWAZULU-NATAL BUSINESS 2018/19 46
Sugar Sugar production is on a downward trend. OVERVIEW Most of South Africa's 14 sugar mills are in KwaZulu-Natal, as are the headquarters of the biggest companies. Overall production volumes have been down in recent years because of the severe drought. Total saleable sugar in the South African market (for domestic use and export) was over twomillion tons in the 2013/14 and 2014/15 seasons. The figure for 2016/17 was 1.6-million tons. A proposed national sugar tax is being opposed by industry representatives. About 40% of local production is exported. The South African Cane Growers' Association represents about 24 000 growers who produce about 20-million tons of cane. Neither of the Big Two companies relies exclusively on South African sugar earnings: Tongaat Hulett has a big property portfolio and Illovo draws most of its profit from operations elsewhere in Africa. Illovo Sugar Limited has a presence in six African countries and is the continent's biggest sugar producer. The group's head office is in Umhlanga Rocks. In 2016 ABF, which used to be Associated British Foods, purchased Illovo. Tongaat Hulett’s headquarters are about 50km north of Umhlanga. The company's sugar divisions turned an operating profit of R1.3-billion ONLINE RESOURCES South African Cane Growers’ Association: www.sacanegrowers.co.za South African Sugar Association: www.sasa.org.za South African Sugar Technologists Association: www.sasta.co.za Sugar Milling Research Institute: www.smri.org SECTOR INSIGHT • A sugar tax has been proposed. for 2016/17, a notable improvement on the previous year. This was partly because of better import protection in the countries where Tongaat Hulett operates and because of higher export prices generated into the EU and other African countries. Tongaat Hullet Sugar has agreed to a R52-million sugar cane growing project which will see co-operatives and contract farmers plant cane on 3 000ha at Felixton, Maidstone and Darnall. Illovo and Tongaat Hulett are the major operators of sugar mills. Other millers are Gledhow, ULC, Umfolozi and Tsb (which has a further two mills in Mpumalanga). Illovo has four mills, three sugar-cane estates, four sugar factories, a refinery and three downstream operations that make products such as furfural, furfuryl alcohol, ethyl alcohol and lactulose. The four mills run by Tongaat Hulett are located on the North Coast while the central refinery is in Durban and the animal feed plant, Voermol, is near Tongaat. The Sugar Terminal at Maydon Wharf, Durban, serves 11 mills and can store more than half a million tons of sugar. It also has a molasses mixing plant. 47 KWAZULU-NATAL BUSINESS 2018/19
