African Agricultural Sector Research Articles

Agriculture and poverty: Farming for food or farming for money?

The dualistic nature of the South African economy manifests itself to a large extent in the agricultural sector, where ownership and access to land was previously reserved and is still mainly controlled by white farmers. This has contributed to the huge disparities in the income levels of black and white agricultural households. In this paper two South African household surveys are used to analyse agricultural inequality using various decomposition techniques. It is found that inequalities within agriculture are higher and more pronounced along racial lines than inequalities among non-agricultural households. Agricultural inequalities also differ structurally from those in the rest of society and are explained largely by differences in the ownership of income-generating assets, and less so by racial wage inequalities. Furthermore, an analysis of agricultural poverty reveals extremely high poverty rates and meagre incomes among black subsistence and small-scale farmer households. These results have important implications for the type of transformation required in the South African agricultural sector, adding weight to the notion that commercialisation is crucial if agriculture is to contribute meaningfully to poverty reduction among the rural black community.

A Bayesian approach towards facilitating climate change adaptation research on the South African agricultural sector

Evaluating the range of proposed adaptation measures to combat the sensitivity of agriculture to climate change effects involves evaluating complex interactions between human and natural systems. Integrated strategy-making and implementation in the agricultural sector to reduce the risks posed by climate change requires the consideration of multiple, interdisciplinary factors and the sensitivities of their interrelationships. Lack of information on the sensitivity of agricultural activities to climate change in Africa hampers climate change adaptation research on the region. In water scarce South Africa, the growth of the agricultural sector is threatened by projected decreases in water availability due to climate change. This paper shows how Bayesian networks may be used to facilitate cross-disciplinary participation in elucidating these sensitivities. Bayesian networks provide a graphical framework for mixing quantitative and qualitative information and can be characterised using information associated with varying degrees of uncertainty. This enables a variety of domain experts to test key driver-response interactions through sensitivity analysis and enables visualisation of the complex inter-relationships between inter-disciplinary variables resulting from the impacts of climate change scenarios on South African agriculture. The ability to represent the sensitivities between key variables for which varying degrees of data-scarcity and uncertainty occur provides agricultural sector researchers with a facilitation tool that may helps visualise and formulate climate change mitigation strategies. The results presented here illustrates the extreme sensitivity of water-scarce South African agricultural sector to projected climate change impacts and provides a framework in which tradeoffs between activities can be preliminarily assessed in strategy-making for adaptation.

Potentiel de Productivite et Efficacite Technique du Secteur Agricole en Afrique

This study utilizes frontier metaproduction functions to analyze inter-region agricultural productivity differences. Technical efficiency scores are examined through estimation of stochastic frontiers for 16 African countries divided into three different regions (West Africa, East and Southern Africa, and North Africa) from 1970 to 2001. The idea is to explore the differences in efficiency and technological gaps of agricultural sector. Apart of common traits that characterize African agricultural sector, countries exhibit national and regional specificities. These diversities are such that it is difficult to make valuable generalizations. It appears from the results that: in West Africa, the level of technology is relatively good, meaning that there is no problem of input constraints. By contrast, the efficiency with which inputs are used is very low. The situation is very different in the East and Southern Africa, with the level of technology relatively low and appreciable technical level. At least, the North Africa countries make a performing mixture between technology and efficiency. Cette étude utilise les Meta frontières de production pour analyser les différences inter-régionales de la productivité agricole. Les niveaux d'efficacité technique sont examinées par l'estimation des frontières stochastiques de 16 pays africains regroupés en trois régions (l'Afrique de l'Ouest, l'Afrique de l'Est et Australe, et l'Afrique du Nord), sur une période allant de 1970 à 2001. L'idée étant d'explorer les différences d'efficacité et les écarts technologiques du secteur agricole. Au-delà des simples traits communs qui caractérisent le secteur agricole africain, on trouve des expériences nationales et régionales dont il est difficile, du fait de leur grande diversité, de tirer des généralisations valables. Des résultats de l'étude, il ressort que: en Afrique de l'Ouest, le niveau technologique est relativement satisfaisant, traduisant le fait que la présence des inputs ne représente pas une contrainte. Par contre le niveau d'efficacité avec lequel ces intrants sont utilisés est assez faible. La situation est tout autre en Afrique de l'Est et Australe avec un niveau technologique relativement faible et un niveau d'efficacité appréciable. L'Afrique du nord enfin fait un savant dosage entre efficacité et technologie.

Exchange rate volatility and agricultural trade under policy reforms in South Africa

Decades of government intervention have helped develop the South African agriculture sector to its present state. Policy reforms have included trade and exchange rate policies to increase the country's international competitiveness, reduce poverty and promote economic growth. These reforms are facilitating the growth in agricultural trade and South Africa's reintegration into the global economy. Annual agricultural exports and imports have increased. This paper uses annual data and a vector error-correction model to investigate the supply and demand relationships for agricultural trade flows in South Africa during the past four decades. The results show that prices, real exchange rates, domestic production capacity and real incomes have significant impacts on the country's agricultural trade. In particular, exchange rate volatility has negative impacts. This cannot be viewed solely as an exogenous source of macroeconomic instability in South Africa, as domestic policies play a crucial role in influencing the movement of exchange rates.

Production Structure, Factor Substitution, and Total Factor Productivity in the South African Agricultural Sector

The production structure of the South African agricultural sector is analyzed using duality theory in production and cost. An unrestricted translog cost function is estimated, and a number of model restrictions (homothetic, homogenous, unitary elasticity of substitution, Hick’s neutral technical change, and no technical change) are tested for, but none of them was found to be statistically significant. The Allen Elasticity of Substitution (AES) and the Morishima Elasticity of Substitution (MES) are calculated to analyze factor substitution, and found that the AES may give erroneous results in the case of number of factors exceeding two. The substitution of land is found to be easiest while that of fuel to be hardest. Furthermore, technical change is found to have a negative impact on agriculture, but there are increasing returns to scale in South African agriculture. However, technical change dominates over scale effect, and results in negative total factor productivity growth. When these results are combined with the finding that, it is easier to substitute machinery by labor than vice-versa, it appears that labor-intensive technologies may be useful for agriculture growth.

Research and Development Towards Sustainable Agriculture by Resource-Poor Farmers in Sub-Saharan Africa: Some Strategic and Organisational Considerations in Linking Farmer Practical Needs with Policies and Scientific Theories

Sustainable agricultural development is presented as a diverse and dynamic process through which it copes with agro-ecological and socio-economic diversity at field level and with ever-changing needs and opportunities of (smallholder) farmers. In support, agricultural research—aimed at locally appropriate and environmentally friendly technologies—should contribute to bridging the currently increasing gaps between scientific theories and government agricultural policies as opposed to the practical field realities that farmers are facing. These gaps are best illustrated by—what in the West is often presumed to be—a stagnant African agricultural (in reality it is not!) in spite of many ambitious policies and projects by national governments and international donors for several decades. Disappointing adoption rates by resource-poor smallholders of the proposed ‘modern’ agricultural technologies have often been blamed. However, the actual local systems are primarily based on ‘ecological’ and ‘organic’ concepts. Localised intensification through recycling of organic by-products is an integral part of such systems. Consequently, these systems are uniquely adapted to the diverse framer needs resulting from widespread variations in soil, climate and socio-economic conditions. By contrast most international R&D support for the African agricultural sector is aimed implicitly at creating a modern conventional system of farming based on external inputs and along a Western industrial model. To cope with diverse and complex, location specific problems inherent in development, sustainability and poverty alleviation, requires strong national research and development (R&D) institutions that adopt comprehensive, people-centred approaches as opposed to the technocratic nature of most formal international development assistance. The development debate therefore should be turned around. The ‘existing’ smallholder farming systems and their needs should be a point of departure, while the various development initiatives and policies should be handled by including the related institutional aspects.

Le paradoxe de la fiscalité agricole en Afrique subsaharienne

In many sub-saharan african countries, agricultural sector adjustment programs failed to succeed because of a severe budgetary constraint which prevent actual reform of the incentive scheme and lead to maintain a high degree of taxation on agricultural exports. On the basis of theoretical litterature and african agricultural sector specificities, the aim of this paper is to draw the main caracteristics of a tax policy for the agricultural sector which would enhance agricultural growth. It is suggested to replace export tarifs by a tax on agricultural income collected at the border, to introduce a land tax in the most favorable areas, and to keep agricultural inputs free from any taxation(This abstract was borrowed from another version of this item.)

REPRESENTING THE PRODUCTION STRUCTURE OF SOUTH AFRICAN AGRICULTURE

This paper evaluates the production structure of the South African agricultural sector for the period 1970–1998, using a translog function. The results show that the production structure is best represented by production technology that is Hicks-neutral and homothetic. This information is useful in evaluating the results of previous research on the structure of South African agricultural production, particularly relatively recent research on elasticities of substitution. In addition, it also provides the basis for meaningful future analysis of aspects related to the production structure of agriculture.

STRUCTURAL CHANGE IN AGRIBUSINESS: THE CASE OF POTGIETERSRUSSE TABAK KOÖPERASIE (PTK)

In response to the structural changes in the South African agricultural sector, Potgieterusse Tabakkoöperasie (PTK) extended its operations to include marketing activities. This article introduces the theme of structural change/industrialisation in the South African agricultural sector and explores the complexity of structural options and decision-making variables that managers have to face when considering vertical expansion. A case study approach is followed at the hand of new institutional economics to explain strategic choices by PTK management. The results from organisational theory and transaction cost theory, as applied to the same problem, yields complimentary and robust results.

Interrelationships between economic policy and agri-environmental indicators: an investigative framework with examples from South Africa

A number of methodological approaches to understanding and quantifying the potential impacts of changes in macroeconomic and sectoral policies on the natural resource environment have been developed in recent years. However each has its limitations, resulting in policy change still being implemented without due attention to environmental impacts. Two key drawbacks of those methodologies that do attempt to model these impacts are that they are generally static in their approach, thus may not alert the decision maker to the often quite different long-term implications, and that they attempt to generate rather specific sets of indicators, making them difficult to use and/or interpret outside case study applications. In this paper we expound a framework for addressing these limitations in the context of the agriculture sector. In developing countries in particular the dynamic dimension is critical given the twin pressures of population growth and rising incomes associated with economic growth. In light of the second drawback, it is the propensity of policy to impact upon the natural resource environment via its effect on the type of farming practice adopted that forms the focus of the paper. A methodology is first developed to facilitate the tracing of likely impacts of both price and non-price reforms, via both the incentives and constraints to increased food production. By separating out the impacts on environmental indicators associated with extensification and intensification of agriculture, it is possible to determine which of these indicators are most likely to be affected by policy changes, and to what degree in both the short and longer term. The framework is then applied to case study data from the South African agriculture sector to demonstrate how consideration of the risk of natural resource degradation earlier in the policy dialogue process could result in the implementation of more effective complementary measures.

THE AGRICULTURAL INPUT INDUSTRY AND THE COMPETITIVENESS OF SOUTH AFRICAN AGRICULTURE

(1999). THE AGRICULTURAL INPUT INDUSTRY AND THE COMPETITIVENESS OF SOUTH AFRICAN AGRICULTURE. Agrekon: Vol. 38, No. 4, pp. 487-515.

Women on South African Farms: Empowerment Across or Along Race and Class Divisions?

This paper explores the role being played by two prominent women groupings in empowering farm women on South African fruit and wine farms. By focusing their efforts on farm wives and women farm workers, the Cape Women’s Forum has embarked on a process of empowering farm women across race and class divisions. This approach contrasts with that of the other group – the Women on Farms Project – in that the latter facilitates the empowerment of women farm workers only. The paper examines the activities of two groups, analyses the underlying assumptions regarding women’s shared interests guiding these divergent approaches from a feminist perspective, and identifies factors which could constrain women’s empowerment. Information on these groups was obtained by in‐depth interviews and analysis of written documents. It is suggested that liberal and socialist/Marxist feminist paradigms are particularly useful when interpreting the empowerment strategies employed by these two women’s groups. The paper concludes that, although these groups are making significant inroads into the empowerment of farm women, developments within the South African agricultural sector and the politics of international sponsorship may impede empowerment efforts in future.

Komparatiewe voordeel in die landbou

The object of this paper is to demonstrate the use of an alternative method to measure and quantify international competitiveness. The South African agricultural sector is taken as a case study. The paper builds on Bela Balassa's method (1989) of measuring comparative advantage by means of historically revealed advantage. In practice this method is easy to use, readily applicable and the necessary data are usually available. The results of this measuring excercise are interesting and support the hypotheses that a low level of labour productivity contributes significantly to the low international competitiveness of South African agriculture.

'N DINAMIESE LINEÊRE PROGRAMMERINGSBEPLANNINGS-MODEL VIR GEMENGDE VEE-WEIDING-GRAANBOERDERYE / A DINAMIC LINEAR PROGRAMMING PLANNING MODEL FOR MIXED LIVESTOCK-PASTURE-GRAIN FARMS

The dinamic linear programming technique can be used as an aid in whole-farm planning. The limited capacity of microcomputers has restricted the development of user-friendly optimizing models and as a result this handy planning method was not commonly used in the South African agricultural sector. The computer revolution has now made it possible to develop a DLP model for microcomputers. The planning horizon of the Optima model on microcomputer is six years and is most suitable for the comprehensive planning of livestock-pasture-grain farms. Assumptions, activities and constraints of such an optimizing model are discussed and the results of different scenarios analysed. The results show that the realistic scenario differs more from the pessimistic scenario and less from the optimistic scenario. The conclusion is that exceptional management is needed during times of lower product prices and yields. During favourable conditions more wheat is planted. This probably indicates wheat to be one of the most profi...

DOMESTIC AGRICULTURAL SUPPORT IN SOUTH AFRICA FROM 1988/89 TO 1993/94: A CALCULATION

“I sit there talking about soybeans, and I don't even know what the miserable things look like.” (Giuilo Andreotti, Italian Foreign Minister) The objective of this paper is to calculate total support received by the South African agricultural sector during the period 1988/89 to 1993/94. In the calculation of the total support to agriculture in South Africa, the Producer Subsidy Equivalent (PSE) was used to determine the internal support received by producers. The PSE was not calculated on a product-specific basis, but for agriculture as a whole. Agricultural support in South Africa has increased steadily during the past few years. With the exception of the drought relief programmes in 1992/93, support amounted to approximately R4 billion a year since 1991/92. Market price support is the largest component of domestic support and has contributed about 48 percent of total support during the previous four years.

ENTREPRENEURSHIP AND THE BOTTOM LINE: HOW MUCH OF AGRICULTURE'S PROFITS IS DUE TO CHANGES IN PRICE, HOW MUCH TO PRODUCTIVITY?

Abstract Conventional financial analysis shows that profit comes from the difference behveen revenues and costs. A sector can generate profit growth through productivity growth or price over-recovery, or both. The course that is taken, however, has important implications for its longer-term competitive positioning. The South African agricultural sector showed a steady decline in its performance since 1973. The decline is attributed to the cost-price squeeze; incrcases in productivity did not compensate for decreases in price recovery. The decline reached its lowest in 1983 when the growth in productivity overtook the negative effect of the terms of trade.