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June 16, 2009

South African citrus programs transfer ownership to farm workers

by Chris Koger

Training, training, training. Gerrit van Rensburg, new minister of agriculture for South Africa’s Western Cape province, said his department’s priority is to transition previously disadvantaged farm workers into commercial growers and ranchers. To do so, $150 million of the agriculture department’s $400-million budget is set aside for different training initiatives.

Post-Apartheid government initiatives in South Africa seek to redress the disparity in white/black ownership, mandating that companies transfer some ownership to black employees and train them for management positions. The Black Economic Empowerment (BEE) Act of 2003 outlines these mandates.

Rensburg, an ostrich farmer and South African Parliament member who started the new position with a change in provincial government in May, said there are major changes taking place in agriculture.

“In the citrus industry, there are a lot of people who want to be mentors, who want to empower their farm workers,” he said in late May. “If you come back in 10 or 13 years, you’ll see a lot, especially in the Western Cape, of brown and black new commercial farmers.”

There are 14 BEE projects in the Western Cape citrus industry, including:

Mouton Citrus — Seald Sweet International Inc., Vero Beach, Fla., has an equal ownership in Mouton Citrus with the Mouton family, but 10.7% of the company is owned by Mgro Ltd., a worker-owned company. There are plans to increase worker ownership to more than 25%.

Goede Hoop Citrus — The largest packinghouse in South Africa, the company established the Goede Hoop Citrus Limited Empowerment Trust by buying shares from non-active shareholders. The employee-owned trust owns 15% of the shares in the company, and there are plans for future expansion.

De Kamp Pty. Ltd. — Growers and brothers Piet and Gerrit Smit formed De Kamp, of which farm workers have 50% stake. There are about 50 acres owned by the company, and the brothers are focusing on the U.S. and Europe as markets for the fruit.

“Training of farmers and farm workers is important for us as a government,” Rensburg said.

Stiaan Engelbrecht, managing director of Everseason Pty. Ltd., Citrusdal, markets citrus from 19 growers packed at five packinghouses, most of which have BEE programs. Those programs, he said, are not about redistributing wealth.

“It’s great to see how attitudes have changed,” Engelbrecht said.

Johan van Zyl, president and owner of Heidedal Boerdery, one of the Everseason packinghouses, agreed.

“The whole process is not something we fear,” van Zyl said. “It is something we must do.”

Piet Smit, who is also chief executive officer of the Western Cape Citrus Producers Forum, said land ownership triggers deep emotions, and the land he grows on has been in his family for four generations.

Unlike some other regions of Africa — most notably Zimbabwe — the Western Cape doesn’t have a history of widespread bloodshed over farmland.

In the last decade, thousands of white farmers have been removed from their land or killed by groups in a land-transfer campaign backed by Zimbabwe president Robert Mugabe. The result has been a notable decline in agriculture exports, idle farmland and starvation.

The Packer

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