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Global Development Institute

Farm Scale and Viability: an assessment of black economic empowerment in sugar production in Mpumalanga Province, South Africa

This project contributes to understanding of the relationship between farming scale and rural poverty reduction. It provides a quantitative and qualitative analysis of farming efficiency (in terms of land, water, labour and capital) on farms ranging from less than 10ha to more than 1000ha producing sugar cane in the lowveld of Mpumalanga Province, South Africa.

It also provides information on the role farming (including direct and indirect employment by farms) plays in rural livelihoods, and on the political and institutional relations associated with farming at different scales in this area. The project assesses how farm scale affects the distribution of benefits and costs in this part of the South African rural economy and the policy lessons this has for the wider African context in which foreign investment in large-scale farming is accelerating. 

This project is led Professor Phil Woodhouse in collaboration with Paul James and Professor Ben Cousins, PLAAS, University of the Western Cape, South Africa. It is funded by the Department for Internaitonal Development and Economic and Social Research Council joint programme on poverty alleviation.

Key academic publications

Findings

Sugar cane production in the Nkomazi Municipality of the Mpumalanga Lowveld has been intimately linked to the eviction of the black population in the 1950s and their resettlement in ‘homeland’ areas along the Swaziland border. The subsequent boom in commercial sugar cane production in the area was also used as a means to provide improved incomes for about 1200 small-scale African sugar cane growers in the last decade of Apartheid. Since the establishment of majority-rule government in 1994, the sugar industry in Nkomazi has increased its share of the South African market while transferring at least 25 per cent of land growing sugar cane back into ownership of previously evicted black communities through South Africa’s land reform programme. The industry now claims that the majority of land used for sugar cane in Nkomazi is owned by the beneficiaries of land reform. However, among small-scale growers a crisis in operation and maintenance of irrigation has prompted two contradictory trends.

On the one hand, few young people are taking over their parents’ small-scale sugar cane farms and a process of land concentration is taking place as a more successful minority ( about 30 percent of small-scale growers) become ‘medium-scale’ by buying the land of their less successful neighbours. On the other hand, there is a move by the sugar milling company to take more direct control of failing small-scale sugar cane schemes by turning them into larger blocks through rental agreements with small-scale landowners. The latter draws on recent experience of ‘joint-venture’ sugar cane production on land transferred to black ‘community trusts’ under the land reform programme. While these moves to medium- and large-scale farming are consistent with the changing livelihoods and aspirations of black South Africans since the end of apartheid, there are contradictions between the emergence of black capitalist medium-scale farmers on the one hand and extension of corporate control of production on the other. While corporate agriculture offers advantages to some, in particular farm employees and a small number of black-owned contractors, it appears geared to the profitability of the sugar processing factories and offers little benefit to the majority of African ‘landowners’ while potentially blocking the further expansion of medium-scale growers.

Impacts

Preliminary results were presented to small-scale sugarcane growers at a workshop in Nkomazi (in August 2014). They have also been discussed with, and comments received from, agencies involved in supporting small-scale growers, in particular Mpumalanga Canegrowers (representing sugarcane growers' interests) and TSGro (a service company jointly owned by small-scale sugarcane growers and the sugar company, TSB). The findings have also been presented at two conferences (one in South Africa, and one in the UK) and appear in the journal 'Journal of Southern African Studies'. The project provided funding for a conference of the Southern African Sugar Research Network, in Johannesburg in November 2014, bringing together researchers from seven countries in southern Africa working on the political economy of sugar production.