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An agricultural market viewpoint of SA agriculture: Dialogue at the Karoo Winter Wool Festival

Estimated reading time: 6 minutes

This year’s Karoo Winter Wool Festival in Middelburg in the Eastern Cape showcased the value chain activities and unique traits of wool as a natural fibre. The festival, which is centred in the heart of the Karoo, commenced on 20 June and concluded on 25 June, with a promise from many of the visitors to return for the third instalment of this vibrant event.

Among the guest speakers were Wandile Sihlobo, chief economist at Agbiz, and Dr Piet Croucamp, senior lecturer at the NWU Business School (Mahikeng campus).

Read more about the South African wool industry here.

The Karoo – a hinterland with vast agricultural possibilities

How can South Africa promote agricultural growth in this sparse and very remote region by unlocking its natural assets and the heritage of the Karoo? In answer to this question, Sihlobo said there are various opportunities to pursue, including the region’s food heritage, high-end fashion and agritourism.

“Exploring and expanding these opportunities will give producers in the Karoo the opportunity to diversify and improve their revenue streams by not solely depending on export markets for wool,” he said. “High dependence on wool exports can come with challenges, such as when China temporarily banned the export of South African wool, leading to a 22% year-on-year decline in wool export earnings (Figure 1).”

Read more about the former Chinese ban.

Figure 1: South Africa’s overall wool exports.

At the very basic level, people need to eat to live, and food carries the smells and tastes of places, families and histories. “It matters to people what, when and how they eat, and sometimes where their food comes from,” remarked Sihlobo. “Food heritage is linked to ecology, sustainability, health and origin. Exploring food in the context of heritage can raise interesting questions about identity, people’s relationship to the land, the availability and quality of local produce, poverty and health. This would not be the first time such a thing is done since various countries in Europe continue to benefit from their food heritage.”

Food heritage offers obvious spin-offs in product development, economic value and tourism. One can see elements of these foreign food heritage products on the shelves of leading supermarkets. “But somehow these same retailers do not showcase enough of our own heritage,” said Sihlobo. “The Karoo is South Africa’s hinterland and one of the natural assets of the Northern, Eastern and Western Cape because of its pristine natural beauty, clean air, peace and quiet. It therefore has a strong commercial and marketing value, which producers can utilise. Still, the name ‘Karoo’ has been widely misappropriated by various individuals and businesses, misrepresenting products such as Karoo lamb. Some retailers may be sourcing large volumes of lamb from the Karoo without acknowledging the origin and heritage of the product.”

Encouraging all producers in the Karoo region, Sihlobo gave the following tips:

  • Reclaim the Karoo brand by protecting the name and identity through the registration of a geographical indication (GI).
  • Lift Karoo lamb out of the meat commodity mark and create its own pricing and distribution structure.
  • Create a different price point for Karoo lamb.
  • Enforce quality and food safety standards.
  • Ensure producer control of the supply chain and form strategic partnerships with abattoirs, packers and wholesalers.
  • Prevent overdominance by major retail chains.
  • Educate consumers on the quality and value of Karoo lamb.

“South African consumers are already buying European GI products in South African supermarkets – many cheeses and hams carry the famous EU GI logo, and retailers sell these famous names protected by EU legislation. South Africa introduced similar regulations in 2019 and enabled Rooibos, and now very soon Karoo lamb, as South Africa’s first GI products. The ongoing efforts to promote Karoo lamb as a GI product have also brought about interesting spin-offs in relation to the fashion industry, which can add tremendous value to the Karoo,” Sihlobo concluded.

Read more about the University of the Free State’s wool empowerment project.

Taking a stand against organised crime

Dr Piet Croucamp, senior lecturer at the NWU Business School (Mahikeng campus), said the minister of agriculture, Thoko Didiza, is constructively involved in the agricultural sector, focussing on food security by putting emphasis on the economy of agriculture and feasibility of productivity.

“The political and economic seclusion the South African agricultural sector has endured the past few decades is an important fact to take into consideration,” said Dr Croucamp. “The sector has basically been left to its own devices to manage the value chains and trade in exports, the latter of which has enabled the country to retain its position as a net exporter of agricultural products. Lately, however, we have seen a change where some big economic role-players in the country have begun to realise that the agricultural sector will have to get involved in South Africa’s politics.”

Dr Croucamp remarked on the ability of South Africa’s producers to be creative and develop alternative methods to get things done. “It doesn’t matter what you know; it is about how you think about things,” he said. “Our producers are inclined to consider the options that are available to them. One only needs to look at the energy crisis to understand why producers must have an open mind towards new technology and the development of alternative methods to ensure self-sufficiency in the production process.”

Dr Croucamp also addressed the question on what needs to be done to avoid the penetration of organised crime into the agricultural sector, and curb the ANCs drive to own its supply chain. “Those of us who have spine, especially the business community, must take a stand against it now,” he said. “The ANC has no control over the value chains of the South African economy, and producers can still manage the supply chain, having so far also escaped infiltration by organised crime.”

For more information, contact Wandile Sihlobo on 012 807 6686 or wandile@agbiz.co.za, or Dr Piet Croucamp on 018 389 3039 or piet.croucamp@nwu.ac.za. – Carin Venter, AgriOrbit

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