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September 19, 2010

Low maize prices endanger viability of South African farmers

The trade union Solidarity has said that the lives of tens of thousands of people in rural areas in South Africans could be affected if there is any truth to the predictions by Grain SA that as many as 30% of South Africa's commercial farmers would no longer be able to farm due to the low maize price. This means that up to 10 800 farms could fail.

According to Dirk Hermann, deputy general secretary of Solidarity, this could result in smaller farms being swallowed up by larger units. In such cases, many farm workers usually lose their jobs because one of the advantages of large-scale farming is that one large farm does not necessarily need as many labourers as two small farms. Thousands of farm workers could therefore lose their jobs.

Dr Pieter Mulder, deputy minister of agriculture, forestry and fisheries, said earlier that up to 25 farmers in Schweizer-Reneke in North West alone might not survive the maize crisis.

"The loss of buying power in the local communities could lead to a social crisis in the nearby towns. Such a radical change in the agricultural sphere could have a negative effect on schools, churches and the rural economy," Hermann said.

Moneyweb

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