(Bloomberg) — The biggest grains lobby in South Africa said a lack of title deeds in the country’s poorest province is hindering a plan to move the corn belt west as coal mines take over some of the best grain-growing land in the country.
South Africa, the world’s biggest white-corn producer after Mexico, wants to raise annual output by the Eastern Cape, a coastal province in the center of the country, ninefold to 1 million metric tons by 2018 as coal mining renders land unsuitable for farming in the eastern province of Mpumalanga, the Bureau for Food and Agricultural Policy said in a report.
Mpumalanga, which produced 20 percent of 2014’s crop, is usually the largest corn-producing province after the Free State and the area where about 80 percent of the nation’s coal is mined. The Eastern Cape is the second-smallest producer of the country’s nine provinces.
“We’re losing a lot of good agricultural land, the best, in Mpumalanga because of the coal mines,” Jannie de Villiers, chief executive officer of Grain SA, the largest representative of corn growers, said in an interview in Bloomberg’s Johannesburg office.
New farmers in the Eastern Cape are struggling to access finance because they don’t hold title deeds to swathes of communal land that belongs to local communities. The province is the least economically developed, the South African Institute of Race Relations said in a January report.
Newcomers to farming in the Eastern Cape, who produce on a small scale, “are doing it well, but they’re doing it on small pieces of commercial land and they cannot expand because they don’t have the finance,” De Villiers said. “It is communal land — there’s no tenure, no security, no loans.”
Best Potential
About 46 percent of South Africa’s best agricultural land, or fertile soils, is found in Mpumalanga, 12 percent of which will be rendered unsuitable for farming due to mining, the report showed. The usability of another 14 percent of the best- quality land is under threat because of prospecting, it said.
“Communal land rights have been exercised for centuries by traditional communities” in South Africa’s rural areas, where more than a third of the country’s million people reside, Gerrit Pienaar, a law professor at the North-West University, wrote in the October 2013 edition of the journal of the Helen Suzman Foundation. “These rights are not individualized, and may not be registered at present.”
Developing farms in the Eastern Cape, where Grain SA has about 2,000 members out of more than 7,000 countrywide, is favorable because it has good rainfall, stable production, and can generate high yields, De Villiers said.
Corn Imports
South Africa is importing corn for the first time in 11 months as the worst drought since 1992 destroyed crops in the continent’s biggest producer. The dry weather has damaged crops in the Free State and North West provinces, which accounted for 64 percent of output in 2014. The local price of the white variety, a staple food, has risen 22 percent on the South African Futures Exchange in Johannesburg this year and that of the yellow type, used mainly as animal feed, by 10 percent as the government-convened Crop Estimates Committee predicts a harvest of 9.67 million tons, the smallest since 2007.
“If we want to maintain our food security and have a surplus of maize, we need to start producing in the Eastern Cape,” De Villiers said, using the local term for corn.
