Commercial farmers a key to sector

© Fu Qiang – 123RF.com

It's a powerful magnet for international companies looking to invest in agriculture on the rest of the continent.

"They look at South Africa as the point of departure because of our skills base, the maturity of our agricultural economy. They see us as the beachhead for getting into Africa.

"There's a lot of them who fairly aggressively want to come into the continent and they see South Africa as the gateway," says Omri van Zyl, the head of agribusiness at Deloitte.

Providing support services for them could be a huge source of capital for the local agriculture sector and a major creator of jobs.

"These global investors would be looking to use our skills. Why we're so well positioned in South Africa is that we still have the skills, if we can protect them, and these skills can be transplanted into Africa much easier than from North America or Europe or China."

The agricultural sector, which barely contributes 3% to the economy, could contribute as much as 7% or 8%, he says.

But then it would have to be working optimally - in other words, with no political interference. This is unlikely.

"More realistically, we should be looking at 5%."

But if the commercial farming sector goes under and with it the peripheral industries, this potential will not be realised.

"With foreign investment coming in we can certainly bolster the industry a lot further. It would unleash additional capital we can reinvest in different parts of the agricultural value chain.

"This leads to additional job creation and industry diversification."

There is a direct connection between more capital in the industry and greater food security and job creation.

"But in order to attract that investment, you have to create a stable agricultural policy environment and economy, otherwise they're not going to come here." - Chris Barron