Aug 02, 2012
Massmart to incorporate 1 500 black smallholder farmers into its supply chainBack
Agriculture|Natal|Africa|Aggregate|Cutting|Engineering|Finance|Massmart|TechnoServe SA.|Africa|South Africa|United States|Products|Retail|Supply Chain|Mncane Mthunzi|Tina Joemat-Pettersson|Ofcolaco
Butternut, tomatoes and green beans are among the crops harvested.
Massmart executive responsible for the programme Mncane Mthunzi told Engineering News Online during a site visit that about 40 farms in Limpopo had been included in the programme thus far, with the end goal being 50 farms by 2016.
In keeping with Massmart's drive to develop local suppliers and source fresh produce locally, the Ezemvelo programme would be expanded nationally, focusing on areas where there are large concentrations of smallholder farmers that have the potential to grow fresh produce and be integrated into commercial markets.
“The next province where the programme will start is in KwaZulu-Natal,” Mthunzi said.
Through the Ezemvelo programme, Massmart aimed to incorporate more than 1 500 black smallholder farmers into its supply chain over the next five years.
During this period, the company would train, mentor and provide technical assistance to farmers, with the help of successful local commercial farmers, while assisting them to link to finance and retail.
However, the programme was also open to working with mainstream semicommercial farmers who have black economic-empowerment ownership structures or programmes in place.
Massmart would source up to 45% of its fresh produce requirement from mainstream commercial farmers in South Africa, while 30% was targeted to come from small to medium-sized farmers and the rest from the market.
Further, the company also planned to invest in a pack house to aggregate fresh produce from all of the smallholder farms supplying the group.
Mthunzi added that a benefit associated with direct farming was cutting out the middleman to bring down the cost of products. “This way you share the benefits with the consumer and increase farmers' return,” he noted.
The initiative formed part of a R15-million, three-year supplier development deal between Massmart and nongovernmental organisation TechnoServe SA. The deal resulted from the creation of a R100-million supplier development fund aimed at improving the competitiveness of South African manufacturers and producers, which was a key condition of the Walmart acquisition of Massmart last year.
The fund was currently under review by the Competition Appeal Court. “In the meantime we will continue with Ezemvelo, we have to find synergies to move the country forward. But, we are confident that the outcome will be positive,” Mthunzi said.
Agriculture, Forestry and Fisheries Minister Tina Joemat-Pettersson said that volatile food prices necessitated South Africa producing its own food. “We cannot only rely on commercial farmers; small subsistence farmers are also needed.”
The Minister added that her department has entered into a memorandum of agreement with Massmart to assist in the empowerment of small farmers.
The Competition Tribunal approved the merger between Walmart, based in the US, and Massmart at the end of May last year, subject to conditions.
The Competition Commission initially supported the merging parties' argument for unconditional approval of the merger. However, the Departments of Economic Development; Trade and Industry; and Agriculture, Forestry and Fisheries, as well as a number of unions opposed the merger.
A concern raised by the interveners related to the effect of the merger on employment, while the unions stated that the merger would likely lead to a diminution of their collective bargaining rights.
Edited by: Mariaan Webb
Creamer Media Senior Researcher and Deputy Editor Online
To subscribe email email@example.com or click here
To advertise email firstname.lastname@example.org or click here
Recent Research Reports
Automotive 2016: A review of South Africa's automotive sector (PDF Report)
Creamer Media’s Automotive 2016 Report provides an overview of South Africa’s automotive industry over the past 12 months. The report provides insight into local demand and production, vehicle imports and exports, investment and competitiveness in the sector, as well...
Energy Roundup – April 2016 (PDF Report)
The April 2016 roundup covers activities across South Africa for March 2016 and includes details of a North Gauteng High Court Judge’s dismissal of a court application to postpone the 9.4% electricity tariff increase, which the National Energy Regulator of South...
Electricity 2016: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2016 report provides an overview of South Africa’s electricity sector, focusing on State-owned power utility Eskom and independent power producers, electricity planning, transmission, distribution and the theft thereof, besides other issues.
Energy Roundup – March 2016 (PDF Report)
The March 2016 roundup covers activities across South Africa for February 2016 and includes details of the Department of Energy’s plans to announce the preferred bidders for the first tranche of the coal independent power producer procurement programme; the Council...
Steel 2016: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2016 Report examines South Africa’s steel industry over the past 12 months. The report provides insight into the global steel market and and particularly into South South Africa’s steel sector, including production and consumption, main...
Construction 2016: A review of South Africa's construction industry (PDF Report)
Creamer Media’s Construction 2016 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; key participants; local demand; geographic diversification; corporate activity; black economic...
This Week's Magazine
Updated 1 hour 38 minutes ago The two spent-fuel pools at Eskom’s 1 800 MW Koeberg nuclear power station, in the Western Cape, will be full by 2018, increasing the urgency on the State-owned utility to begin pursuing alternative storage options. Koeberg has, over the past 32 years, accumulated a...
Updated 1 hour 38 minutes ago South Africa lacks the skills necessary to implement the government’s plan to build 9.6 GWe of new nuclear energy capacity, warns nuclear-qualified Quality Strategies International CEO David Crawford. “Apart from the concern about the affordability of the programme,...
Updated 1 hour 38 minutes ago Cybersecurity multinational Check Point has released its latest 700-series cybersecurity systems for small businesses, which draw on its international threat intelligence to provide up-to-date cybersecurity, says Check Point South Africa country manager Doros...
Updated 1 hour 38 minutes ago Daimler Trucks and Buses Southern Africa (DTBSA) saw a marked slip in new-vehicle sales in 2015 compared with 2014, with sales dropping from 5 897 units to 5 300 units. The decline came as the South African new truck and bus market declined from 31 558 units in 2014...
Updated 1 hour 38 minutes ago Group of 20 (G-20) economies threatened to penalise havens that don’t share information on their banking clients after the leak of the Panama Papers provoked a global uproar over tax evasion. The G-20 will consider “defensive measures” against financial centers and...