Green Economy Home

Minister Didiza praises Illovo South Africa for life-changing development project

The Minister of Agriculture, Land Reform and Rural Development Thoko Didiza has praised the sugar giant Illovo South Africa for the successful culmination of its R127-million life-changing Small-Scale Grower Cane Development Project that has created over 860 sustainable jobs in KwaZulu-Natal while empowering women to participate in the rural economy.

The Minister was visibly pleased after being taken on a site visit on the KwaZulu-Natal South Coast to witness first-hand the development of 3 000 hectares of cane on communal land by small-scale growers using a sustainable model of development aligned to the national transformation agenda. With a R63-million grant from the National Treasury’s Job Fund matched by R63-million funding by Illovo Sugar South Africa, 119 local contractors have increased the supply of sugarcane for Illovo’s undersupplied Sezela factory by doubling the original 150 000 tonnes per annum forecast.

“The contribution of black commercial farmers in the country’s agricultural economy was still low and these low levels of inclusion call for serious intervention from both the Government and other stakeholders in driving inclusive growth” said Minister Didiza.

“We need more public-spirited players like Illovo Sugar who are willing to work with government in order to leverage our resources in the commercialisation of black farmers, while we ensure that we give meaningful support to those who are beneficiaries of land reform.”

The Minister added that after recognising different challenges constraining the growth and development of commercial and emerging farmers in the country, the Agriculture and Agro-processing Master Plan (AAMP) had recommended the adoption of a “Theory of Change” to train farmers and grow the agricultural sector in an inclusive manner.

The theory advocates for a co-existence of commercial and emerging farmers to promote the agricultural and food sectors on a new growth trajectory that can ultimately contribute to taking South Africa’s economy out of the “Middle Income” trap.  The conceptual framework for this Master Plan has been concluded, and the sector partners are to meet for consultation in June 2021. This Master Plan is complementary to the Poultry and Sugar Master Plans.

Illovo Sugar MD Mamongae Mahlare said the Small-Scale Grower Cane Development Project is clear validation of the great potential that exists for partnerships between businesses and their host communities on the one hand, and government on the other, to reduce poverty and stimulate economic activity. “We could not have achieved this level of success alone. The confidence of the Jobs Funds which met us halfway with concessional funding, and the support of other stakeholders including the SA Canegrowers Association and the South African Farmers Development Association, have been integral to this revolutionary project.

“The collaborative multi-stakeholder approach to bring a local system of innovation to life in just three years has resulted in 1 704 growers being given the opportunity to develop cane on their land.”

Mahlare said the small-scale grower development project created direct jobs in rural communities while implementing socioeconomic and enterprise development initiatives and the transfer of valuable farming and business skills. By leveraging on the built capabilities and securing a spot in the Illovo Sugar value chain, communities will earn upwards of R80-million in income annually.

“Since the capacity to work the land resides within the communities in the form of the upskilled local contractors, there is a multiplier effect as this new money is spent within the community and is catalytic to broader economic activity,” she added.

Najwa Allie-Edries, head of the Jobs Fund who also attended the celebratory event, said building the capability of smallholder farmers must move beyond the debate about land ownership. The imperative now is to find creative solutions to long-term access to land, while providing appropriate support to build sustainable new-era farmer capability, she said.

“In spite of significant growth potential in the agricultural sector, opportunities and benefits are not widespread. The sector is characterised by a huge capacity gap between commercial and smallholder or emerging farmers, placing the latter in a disadvantageous position in terms of accessing opportunities, markets and value chains.

“Robust and localised agriculture and agro-processing systems are crucial for food security, economic diversification and creating jobs. Hence, more than 30% of the Jobs Fund’s portfolio of projects are implemented within the agricultural sector.

“Developing a sustainable sector means growing both the farm and the farmer and expanding the opportunities available to them. It can’t be one or the other; the same level of effort put into crop development must also be put into the farmer and his or her business.

“Illovo Sugar must be commended for reducing barriers to entry for emerging farmers and addressing challenges that hamper their ability to grow sustainably,” she said.

Nomanesi Ngcobo, a small-scale grower who was developed through the Illovo project told Minister Didiza that she took over her late husband’s role and sugarcane that had been planted years before was no longer growing.

She said: “The project came at a crucial time for us because the eMalangeni area had run out of sugarcane and many growers were struggling. Sugarcane farming is our bread and butter – it allows us to pay for our children’s education.

“This has been a life-changing experience and we are so grateful to Illovo Sugar for empowering us and enriching our lives.

“To be part of the cane grower’s community as a black woman makes me happy, especially having come from an impoverished background,” said Ngcobo.

What is the background of the project?

An under-supply of sugar cane into the South Coast mills necessitated action to be taken to re-establish sugar cane in the Small-Scale Grower areas that were lying fallow and within a close proximity to the affected mills. A sustainable development model was sought to ensure the future cane supply in the SSG areas.

What was the overall aim of the project?

To ensure equitable, inclusive and sustainable growth, leveraging sugarcane as a catalyst for rural development, while ensuring a secure supply to the Illovo mills. To this end, Illovo Sugar SA committed to:

  • Develop contiguous areas of tribal land to sugar cane
  • Develop and empower previously disadvantaged cane growers and contractors
  •  Create employment and contribute to development in the rural areas
  •  Create SMME service providers; and
  • Increase cane supply to the Illovo Sugar mills

What was initiated to address this problem?

In partnership with National Treasury through the Jobs Fund, Illovo Sugar SA initiated a project to develop up to 3 000 hectares of small-scale grower cane land around all the areas within which it operates on the KZN South Coast resulting in the creation of 1 188 new jobs and the training of 1 630 people.

What were some of the challenges to be overcome?

  • How to introduce economic activity on communal land
  • The high cost of entry and lack of suitable, continuous funding
  • Lack of grower and service provider capability

How was funding sourced?

Operating under the Department of Trade & Industry, the Jobs Fund was launched in June 2011 and an amount of R9 billion was set aside. The objective of the Jobs Fund is to co-finance projects by public, private and non-governmental organisations that will significantly contribute to job creation. This involves the use of public money to catalyse innovation and investment on behalf of a range of economic stakeholders in activities that contribute directly to enhanced employment creation in South Africa.

In partnership with the Jobs Fund which provided 50% of the R127-million capital, Illovo launched the project to develop 3,000ha of small-scale grower cane land whilst contributing to stimulating activities in deep rural areas, create sustainable employment for black growers and their families, and provide training opportunities for rural households. Illovo put up 15 % of the capital. The remaining 35% was taken as loans by the growers from MAFISA, with Illovo underwriting the debt. The project has created a thriving small-scale growers project on Ngonyama rust land.

Was the project a success?

Illovo’s Small-Scale Grower Cane Development Project is clear validation of the great potential that exists for partnerships between businesses and their host communities on the one hand, and government on the other, to reduce poverty and stimulate economic activity. The collaborative multi-stakeholder approach to bring a local system of innovation to life in just three years has resulted in 1 704 growers being given the opportunity to develop cane on their land.”

What are the outcomes of the project?

The Small-Scale Grower Cane Development Project has created direct jobs in rural communities while implementing socioeconomic and enterprise development initiatives and the transfer of valuable farming and business skills. By leveraging on the built capabilities and securing a spot in the Illovo Sugar value chain, communities will earn upwards of R80-million in income annually. Since the capacity to work the land resides within the communities in the form of the upskilled local contractors, there is a multiplier effect as this new money is spent within the community and is catalytic to broader economic activity.

Purpose of lllovo’s celebratory event

The event is planned to relate Illovo SA’s successes in contributing towards creating thriving rural communities through revealing how the joint programme has and can further act as a blue print for small-scale cane grower development in KZN as well as help other regions and sectors build thriving communities through similarly structured public and private partnerships.

What progress has Illovo made on land redistribution?

To date, Illovo’s own land redistribution initiative has resulted in the sale of 28 086 ha, comprising 55% of its own land portfolio, to black people and resulting in the establishment of more than 50 black commercial farmers.

Cite an example of a successful small-cane grower

Nomanesi Ngcobo took over her late husband’s role and sugarcane that had been planted years before was no longer growing. She said: “The project came at a crucial time for us because the eMalangeni area had run out of sugarcane and many growers were struggling. Sugarcane farming is our bread and butter – it allows us to pay for our children’s education. This has been a life-changing experience and we are so grateful to Illovo Sugar for empowering us and enriching our lives.”

Register or Login to Comment

Registration also gives you access to both Positive Impact & Green Economy Journal Digital Magazines and Newsletters

Register

Already have an account? Log in
    We use cookies to understand how you use our site and to improve your experience. By clicking “I Agree” or by continuing to use our website you agree to their use.