Abstract
The land reform programme of the South African government aims, among other things, at generating large-scale employment, increasing rural incomes and combatting poverty. However, the programme equally enforces an agribusiness model that promotes large-scale production through failure to subdivide the large farms, and encouraging the beneficiaries to use the land in the manner that the former white landowners did. The article demonstrates the unsuitability of large-scale production for the land reform beneficiaries, given its unsustainable production costs. On the contrary, the limited costs associated with the small-scale model allow the beneficiaries, including those relying on off-farm income, to produce with better effect.
Introduction
The South African government’s land reform programme aims, among other things, at generating large-scale employment, increasing rural incomes (Department of Land Affairs [DLA], 1997) and combatting poverty (Department of Rural Development and Land Reform [DRDLR], 2013). However, the programme equally enforces an agribusiness model that promotes large-scale production through failure to subdivide the large farms, and encouraging the beneficiaries to use the land in the manner the former white landowners did. Joint ventures, such as strategic partnerships and share equity schemes, are promoted, thereby enforcing large-scale production, a key feature of the agribusiness model. The article demonstrates the unsuitability of large-scale production for the land reform beneficiaries, given its unsustainable production costs. It uses data from the Elangeni case study in Limpopo province, South Africa, to show how the limited costs associated with the small-scale model allow the beneficiaries, including those relying on off-farm income, to produce with better effect. Thus, in promoting large-scale production, the government emphasizes modernist and colonial orthodoxies centred on criteria of commercial viability (Hall & Kepe, 2017). The approach disregards contributions from the global South on the alternative models of agriculture conducive to the local contexts, and capable of improving the livelihoods of the poor.
The article begins by discussing the land reform programme in South Africa and the enforcement of an agribusiness model, for which large-scale production is a key feature. It then reviews debates on the small-scale model, but in particular how black Africans have used land historically. The case study of the Elangeni farming project is then discussed to demonstrate how large-scale farming is costly beyond the ability of many land reform beneficiaries. On the contrary, a case is made to demonstrate why a small-scale model, with its limited cumulative costs, is more suitable for the land reform beneficiaries. The conclusion sums up the discussion while arguing that land reform beneficiaries can succeed when producing within the small-scale model.
The Land Reform Programme in South Africa: Does It Promote the Agribusiness Model?
The land reform programme in South Africa has its basis in Section 25(5) of the South African Constitution. The section states that ‘[t]he state must take reasonable legislative and other measures, within its available resources, to foster conditions which enable citizens to gain access to land on an equitable basis’ (Republic of South Africa [RSA], 1996). In the Reconstruction and Development Programme (RDP) of the African National Congress (ANC), the land reform programme is viewed as central to rural development, large-scale employment creation, increasing rural incomes, and addressing overcrowding (African National Congress [ANC], 1994). As stated in the White Paper on South African Land Policy, access to land can contribute inter alia to the improvement of livelihoods (DLA, 1997).
Between 1995 and 1999, poor households were given Settlement and Land Acquisition Grants (SLAG) (R16,000 per household) by the government to enable them to purchase the land (Hall, 2004). For Hall (2004), at this juncture the land reform approach was pro-poor. Of the challenges faced by the land reform beneficiaries during this period, emphasis has been on the complex group dynamics that reproduced overcrowding and the limited post-settlement support (Anseeuw & Mathebula, 2008). Less emphasized is how the inherited large-scale, capital-intensive forms of production emanating from failure to subdivide the farms affected the beneficiaries’ success (Rusenga, 2017).
According to Hall (2004), the replacement of SLAG by the Land Redistribution for Agricultural Development (LRAD) programme, in 2001, shifted the policy focus towards the establishment of a class of black commercial farmers in the land reform projects. Under LRAD ‘applicants would need to make a contribution to the cost of the land of between R5,000 and R400,000 and, depending on the level of this contribution, would be eligible for a matching grant of between R20,000 and R100,000, on a sliding scale’ (ibid., p. 216). Alterations were made regarding the requirement of a minimum cash contribution of R5,000 to allow the poor to contribute this in the form of sweat equity (their labour). Although LRAD has been replaced by the Proactive Land Acquisition Strategy (PLAS) as the primary programme for land redistribution, the vision of a class of black commercial farmers has been maintained until now, at least as a policy focus (DRDLR, 2013, p. 11).
While the land acquisition strategies changed since 1994, there has been an intentional preservation of the capital-intensive production patterns of the former landowners in the land reform projects (Aliber & Cousins, 2013), and this has intensified under PLAS (Hall & Kepe, 2017). As many land reform beneficiaries struggled to fit into the adopted large-scale forms of production, a variety of programmes such as mentorships, joint ventures, and co-management arrangements were introduced (DRDLR, 2013). Their purpose has been to assist the beneficiaries to produce within the capital-intensive model of agriculture. The mentors’ responsibility is to transfer knowledge to the beneficiaries in a coaching role. The strategic partners, in joint ventures, take the leading role in sourcing capital, management, and production at the projects. Accepting a mentor or strategic partner is a condition for the beneficiaries to receive funding under Recapitalization and Development Programme (RADP). Even the business planning duties have been transferred to the strategic partners under RADP. The expectation from the government is that the land reform beneficiaries can improve their livelihoods while producing on a large scale.
The strategic partners are mostly agribusiness entities and white large-scale farmers (Hall & Kepe, 2017). Under PLAS, the strategic partners preferred by the government enforces modernist and colonial orthodoxies centred on the criteria of commercial viability, with state officials concerned with ‘surveillance and control of beneficiaries in “projects” with precarious tenure on un-subdivided commercial farms now owned by the state’ (ibid., p. 122). Consequently, Aliber and Cousins (2013, p. 41) argued that ‘the more fundamental problem is the South African state’s stubborn commitment to the LSCF (large-scale commercial farming) model of agriculture’. Thus, the state enforces an agribusiness model, with Kepe and Hall (2018) arguing that land reform in South Africa exhibits a colonial present instead of decolonization.
The beneficiaries are introduced to, and expected to succeed using unfamiliar agricultural models similar to those utilized historically by white farmers in South Africa (Rusenga, 2017). Ironically, the history of agrarian capitalism in South Africa shows that many white farmers struggled to succeed using the large-scale agrarian models. For that reason, state support and political intervention played key roles in sustaining white farmers’ production until the 1980s (Wilson, 1975). Interestingly, when state support and political intervention were reduced from the 1980s, due to the adoption of neoliberal economic policies, many large-scale farming projects collapsed, leading to land concentration in the sector (Hall, 2009). How, then, can the beneficiaries of land reform, largely unsupported, succeed using a model that has historically failed to improve the conditions of many white farmers, despite the support they received from the state?
Despite evidence showing the problems with large-scale production, the large-scale forms of production enjoy global hegemony. Large-scale production is championed by international capital investments in farmland stimulated by the global food price and supply crises. The lack of confidence in international markets as sources of food supply (De Schutter, 2011, p. 251) convinced some countries to outsource food production by buying farmland in the Global South. They were joined by investment funds hedging ‘their assets against inflation, particularly in a context in which the stock markets remained unreliable and were providing at best low returns on investment’ (ibid.). For McMichael (2011, p. 8), all this is a product of the general accumulation crisis, expressed through the conjunction of food, energy, and financial crises, which make agriculture a relatively safe investment haven for the relatively long term. The manner in which the land is acquired has been described as land grabbing by some scholars.
In countries such as Brazil and South Africa, the governments’ agricultural policies are biased towards large-scale farming. Commenting on the PLAS strategy in South Africa, Kepe and Hall (2018, p. 133) argue that ‘the state’s land reform strategies continue to keep control of the land and means of production in the hands of whites, corporate and even multinational capital, as well as black elites, while the majority rural black population holds insecure land rights and is often beholden to the state and whites for their use of the land as “partners”’. Even those who accessed land before PLAS inherited large farms and are expected to improve their livelihoods through large-scale, capital-intensive production (Aliber & Cousins, 2013).
The enforced agribusiness model is the culmination of the emergence of large agribusiness complexes towards the end of the twentieth century, and their rapid expansion and dominance of the agricultural sectors of many developing countries, including international trade in food products (Rusenga, 2017). In this model of farm production, upstream and downstream agricultural activities are dominated by a decreasing number of large agribusinesses with interlinked interests in the supply of inputs, agricultural production, and the marketing and processing of farm products (MST, 2013, pp. 9–10). In South Africa, the agribusiness model has been entrenched through the deregulation and liberalization of the agricultural sector. While the agribusiness model has several features, this article is concerned with the implications of promoting large-scale production in the land reform projects.
The small-scale/large-scale debate is viewed as quite an old and tired debate by some. However, the enforcement of large-scale production on South African land reform projects by the government and its agribusiness partners (Hall & Kepe, 2017) make it important to look at the agricultural models and their impact on livelihoods. Instead of changing the manner in which land is used, the government seeks to provide ‘social and economic infrastructure and basic resources’ while ushering the beneficiaries into the agricultural value-chains (DRDLR, 2013, p. 10). Strategic partnerships and mentorships were introduced in this context.
This article is not arguing that all farms in South Africa, including those owned by agribusinesses, should utilize the small-scale model. The point is that one should be pragmatic and open to a plurality of models depending on conditions and the capabilities of the beneficiaries. The beneficiaries themselves should lead in determining how they can successfully utilize their land, as opposed to the current imposition of large-scale farming on projects, including those of the poor (Aliber & Cousins, 2013). However, one can make a strong case that the poor land beneficiaries can do well in a small-scale model, as fewer resources are needed for production compared to large-scale farming (Mafeje, 2003). I will come back to this point later.
The efficacy of large-scale farming has been championed by some scholars. For instance, Sender (2016) thinks that the few but large farm enterprises dominating marketed agricultural production in South Africa should be supported and encouraged to take-over farm enterprises that are not productive and efficient. For him, it is easier to monitor large enterprises than providing subsidies to many smallholder farmers. The ‘efficiency’ of large enterprises is thought to contribute more to the economy, while making South African agriculture competitive on a world scale. Small farms, according to Sender, have failed historically in South Africa. The author does not address the land reform programme directly. However, his views on the efficacy of large-scale farming are clear.
Bernstein (2007) is sceptical of promoting small farms through the land reform programme. Drawing lessons from the classic agrarian question, Bernstein believes that once pre-capitalist landed property, with its predatory appropriation of rent, is destroyed, leading to the creation of conditions for capitalist agrarian transition, redistributive land reform is not justified. For Bernstein, if the capitalist social property relation established delivers productivity gains, the subdivision of larger (and productive) farms into small farms becomes reactionary and utopian (ibid., p. 38). Reactionary, because it turns back the clock of progress, and, utopian, because the likelihood of achieving ‘efficiency and equity’, increased agricultural productivity, and rural employment and incomes through an egalitarian agrarian structure of family farms is limited. His conclusion suggests that better livelihoods are achieved only in an agricultural system of large farms. While one could go on and discuss the nuances in the arguments of those who favour large farms, the main purpose here is to demonstrate that the South African government’s preferences have a theoretical backing from some scholars on the agrarian question.
Challenging the Hegemonic Model: Why the Small-scale Model?
Various reasons have been offered to support alternative models for land use, such as the small-scale model. For Griffin, Khan, and Ickowitz (2004, p. 368), ‘output per unit of land, or yield, often is higher on smaller farms than on large’. Drawing on data from Brazil, based on the 1995–1996 agricultural census, they show that yields on commercial farms (average farm size of 433 hectares) were only 42 per cent as high as the yields on small farms (average size of 26 hectares). They conclude that the redistribution of land ownership in favour of small farms could raise output and average income. Even investment per hectare, they noted, was slightly higher on smaller farms than on larger commercial farms. Thus, land redistribution can be expected to increase efficiency in the agricultural system.
Investment is important for the land reform programme to succeed. Mafeje (2003) provides insightful views on the implications of production models on the ability of farmers to invest. He noted that the marginal capital to output ratio is higher on large farms than on small ones. Large farms require more capital resources to improve productivity, whereas modest investments are needed for small farms (International Fund for Agricultural Development [IFAD], 1992 cited in Mafeje, 2003). Investment in the large farms generates fewer returns because its diminishing returns on capital are higher. That land reform beneficiaries in South Africa do not receive adequate post-settlement support is public knowledge. Therefore, production using a capital-intensive model may affect many of the beneficiaries who possess few resources. Several studies have shown that many land reform beneficiaries are struggling to sustain the large farming projects financially (Aliber & Cousins, 2013). Thus, the small-scale model becomes important because its cumulative cost, that is, the total amount of resources required, is low, given that the land needing investment is small. In other words, the limited budget required to produce on a small piece of land makes it practically possible for those with limited resources to farm better. Requiring poor beneficiaries to produce on a large scale from the limited budgets, in an environment of limited post-settlement support, is self-defeating. It is tantamount to setting the beneficiaries for failure. For Mafeje, then, the small-scale model is more suitable, as productivity can be improved from modest investments. The model also mobilizes smallholders’ household labour (Mafeje, 2003). This explains Scoones et al.’s (2011) finding, in the context of the fast-track land reform programme (FTLRP) in Zimbabwe, that the small-scale A1 beneficiaries were more successful than the larger A2 commercial farmers, despite the lack of external post-settlement support.
Most beneficiaries lack background in large-scale farming. Even the small African commercial farmers of the 1880s, that Bundy (1979) discussed, used the land outside the large-scale agrarian models. Most African producers, historically, used off-farm proceeds to invest in agricultural production (Ncapayi, 2013), including the black middle class that combined jobs and land in their lives (Mabandla, 2015). That strategy, common among many Africans (Arrighi, 1970) since the beginning of the twentieth century, still continues to date (for Zimbabwe, see Scoones et al., 2011). Given the difficulties of accessing capital and support, in the present context of land reform, it is important to take into consideration that using off-farm income to invest in agriculture is an important strategy. However, that strategy does not work when a costly capital-intensive model is enforced upon the land reform beneficiaries.
For Ben Cousins, the small-scale model creates conditions for petty commodity production where full ‘capitalist agriculture emerges through class differentiation from within the ranks of family farmers’ (Cousins, 2013, p. 119). However, he believes that only a ‘nascent class of small- to medium-scale, market-oriented farmers … are able to engage in agricultural accumulation from below’ (Cousins, 2015, p. 250). They are capable of fully utilizing the productive potential of the scarce land and water resources in the country through significantly investing in their farms. It seems their possession of wealth is a significant factor in their likely success.
However, the fewer cumulative costs associated with the small-scale model can enable those with off-farm income or resources to invest in agriculture with better outcomes. Although not all small-scale farmers will succeed as capitalist farmers (Cousins, 2013), it is likely that many, including those without significant resources, will succeed because of the low costs of the small-scale model (see Mafeje, 2003). Supporting small-scale production may also be favourable for the government, as it may be easier to provide training and extension in this domain. This article argues that the low cumulative costs associated with the small-scale model, coupled with the tradition among black Africans to invest their off-farm income and/or resources in agriculture, make the model more suitable for the land reform beneficiaries in South Africa. We next present a case study of the Elangeni project in Tzaneen, Limpopo province of South Africa, to illustrate how the small-scale model can better facilitate livelihoods for the beneficiaries.
Case Study Background
The Elangeni project is owned by the Elangeni Trust, consisting of Sophie M., Samuel M., and their six children. The parents are retired teachers while the children have professional jobs in the cities. 1 The parents’ pension and the children’s salaries are an important production capital at the project, given the limited external post-settlement support available. The project is 165 hectares in size. It is portion 40 of Grey Stones 469 LT, located in the Deerpark area of Tzaneen, Limpopo province. The farm was acquired for R2,150,000 by the government in 2007, leased to the beneficiaries in the same year, and then transferred to them in 2009 under the LRAD terms. The beneficiaries inherited approximately 10,000 mango trees on 17 hectares and about 3,000 avocado trees on 10 hectares. Following their difficulties in supporting large-scale fruit production, the beneficiaries introduced small-scale organic vegetable production on four hectares using off-farm income (pension and salary remittances). About 130 hectares of grazing land remained fallow, because the beneficiaries did not have livestock (Elangeni SWOT Analysis Document, 2013). Thus, two models exist at Elangeni, the large scale and small scale.
Farming Has Higher Indirect Costs
The beneficiaries at Elangeni produce their products—fresh fruits and vegetables—organically. The decision to produce organically emerged as a response to challenges with raising resources to support conventional large-scale fruit production. Although household off-farm income was invested on the farm from the beginning, it was inadequate to sustain the production of the fruits. The beneficiaries introduced small-scale vegetable production with the aim of generating income for investment in the production of the fruits. Sophie M. said:
It is because if we wait for the mangoes and avocados which come once in a year, what will sustain us throughout the year? The cash [vegetables] crops help us. If you wait for the fruit trees, you harvest in November and December only, and they get finished. The avocados, you harvest in February and March, and they get finished. What will you do this other time? It [vegetable production] is helping, and we are able to pay the workers’ wages. (Sophie M., personal interview, 15 August 2013)
That decision, in itself, is quite informative. The beneficiaries were of the view that their limited off-farm income could have much effect on a small-scale project than on the large one given the limited cumulative costs on the former (Mafeje, 2003). It also exposes the challenges of capital-intensive production for the beneficiaries with limited capabilities and resources.
Organic production was viewed as profitable due to the price premiums that organic products get at the commercial markets. To get the price premiums, farmers should meet the production conditions set for organic products by commercial markets satisfactorily. However, mainstreaming such conditions in the production processes increases costs. Production of organic products for markets controlled by agribusiness requires organic certification. Certification is ‘a third-party written assurance that a clearly identified process has been methodically assessed such that adequate confidence is provided that specified products conform to specified requirements’ (United Nations, 2008, p. x). The process, carried out by an organic certification agent, ensures conformity with set organic standards.
Certification costs are high in South Africa. They average around R15,000 for a small individual farming operation, which is higher than the European average of R10,000 (Joachim S., personal interview, 14 January 2014). 2 The high costs in South Africa are attributed to the absence of domestic standards for organic farming and the small size of the local organic market. Where production is on a large scale, the high costs may deter those with few resources from production. However, the low cumulative costs of the small-scale model may be afforded by the land reform beneficiaries, who can even use their off-farm income to support production.
At Elangeni, certification costs were reduced by joining a local cooperative for organic producers, known as Nkomamonta. The members market their produce together. Because the cooperative receives one certificate for the group, which costs R25,000 to renew annually, the beneficiaries paid less for the certificate, as the amount was shared among the 16 farmers. Additional costs included R10,200 on joining and subscription fees, between 2008 and 2013 (Sophie M., personal interview, 10 June 2013), when the data were collected. These are some of the indirect costs with which land beneficiaries have to contend.
Organic crop producers require special skills and knowledge which may require investment in agricultural courses. The Nkomamonta farmers attended many meetings where they shared knowledge and ensured that all members comply with the organic standards. For instance, in the 6 months between 2 October 2008 and 8 April 2009, Sophie attended 28 meetings to discuss, inter alia, certification, market access, and planting programmes (Elangeni Farm Book, 2013). Knowledge of organic farming facilitates access to the lucrative organic markets controlled by agribusiness. Where free courses are not available, the farmers may need to use their resources to acquire the necessary knowledge. That can add to the indirect costs to farming whose combined cost may be untenable for those engaging on large-scale production.
Packaging adds to the indirect costs that make farming expensive. Sophie M. said:
Over and above that, we were packaging our products at Westfalia. Have you heard about Westfalia? That packhouse was ‘killing’ us. We were working for them. There is money they take from every packet, nearly R150,000 for our [Nkomamonta] products. We ended in September 2011 [to package with them]. They had already made R200,000 for themselves. On our side, I think we made R96,000 combined. (Sophie M., personal interview, 18 July 2012)
In 2014, packaging costs ranged between R10.35 and R11.00, excluding VAT per 4-kg box. The cost covered the carton (approximately R4), pallet strappings, stickers/labels, electricity, labour, and any chemicals (Julia T., email correspondence, 15 January 2014). 3 Where transport was hired from Limpopo to Pretoria, each 4 kg carton was charged at R5, excluding VAT. Thus, around R15 was required per 4 kg carton when transport was hired. If one adds these costs to the budget for production activities on the farm itself, it is clear that many farmers may not afford to support large-scale farming given the huge costs associated with it. However, because the small-scale model has fewer cumulative costs, land beneficiaries can produce better with their limited resources.
Farming Has Higher Direct Costs
As alluded in the previous section, commercial agriculture is very expensive. As such, many farmers without more resources cannot afford to produce on a large scale, as argued by Mafeje (2003), let alone those who depend on household off-farm income. An illustration, using production cost projections data from the South African Subtropical Fruit Growers’ Association (Subtrop), makes this point clear. The data were for the 2006 production season. Table 1 illustrates the production cost projections per hectare of mangoes for trees that have reached maturity age, produced at a commercial level. The costs cover the basic activities that cannot be avoided when producing mangoes for the markets—such as labour, weeding, disease and pest control and harvesting.
Production Cost Projections per Hectare of Mangoes
The projections suggest that an estimated R13,349 was needed in 2006 to produce a hectare of mangoes. That means that for the 17 hectares that Elangeni has under mangoes only, R226,933 would have been needed in 2006. Obviously, that estimated figure is higher now. But how many land reform beneficiaries can afford such costs of production? Many beneficiaries depend on their own sources of funding, such as household off-farm income (Rusenga, 2017). Surely, the costs of large-scale production are prohibitive (Mafeje, 2003) and can affect the land beneficiaries’ success in improving their livelihoods. In the case of Elangeni project, the beneficiaries would also need to mobilize resources for the avocados on 10 hectares. It is likely that the cost per hectare of avocados may not differ much from that of mangoes, given that the general maintenance activities are the same.
Where the scale of production is small—for illustrative purposes, say, five hectares of mangoes—the beneficiaries would have required around R66,745 in 2006, which can more realistically be mobilized than the R226,933 needed for 17 hectares. The limited cumulative costs of the small-scale model can also affect the quality of the products positively, as resources are concentrated on production. Even in terms of output, five hectares of mangoes can generate good income for the beneficiaries. As noted by Subtrop (2013, Mango production costs 2006), at full capacity a hectare of mangoes can produce between 25 and 30 tons. Thus, up to 125 tons could be produced from five hectares of mangoes generating between R101,250 (atchar markets) and R312,500 (informal markets), depending on the markets supplied (ibid.).
Commenting on the pruning of approximately 13,000 fruit trees at Elangeni, Samuel M. said:
We have challenges with machines for pruning these fruit trees. It is very expensive to hire the guys with the machines for pruning the trees. It is R300 per hour. For this row from here to there he will take six hours. Already it is R2,000, one day. When he finishes the whole farm, it will be over R100,000. The trees need pruning for them to produce the quality fruits… (Samuel M., personal interview, 15 August 2013)
Although the figure of R100,000 is just an estimate, Samuel M. confirms that more capital is required for large-scale farming, more so where farming implements have to be hired. For those relying on household off-farm income for operational capital, as is the case at Elangeni, the cost may undermine their production. The point is not that the costs per hectare differ on the small-scale model compared to a hectare on large-scale production. It is the cumulative costs, the total amount of resources needed for large-scale production that are more than what many land reform beneficiaries can afford.
On the other hand, although organic vegetable production is demanding and costly, because the scale of production is small (four hectares), the beneficiaries at Elangeni were able to use their household off-farm income to support production. As shown in Table 2, in 2008, the beneficiaries used R25,898.20 as operational capital for organic vegetable production. Vegetable production was funded mostly from household off-farm income. The Elangeni Farm Book is not exhaustive, nor comprehensive in terms of capturing every cost at the farm. However, the fact that the beneficiaries could fund production using their own offfarm income confirms Mafeje’s (2003) view that modest investments are required for production using the small-scale model. The small-scale model positively amplifies the effect of limited investments in agriculture (Rusenga, 2017). It is important to note that R25,898.20 used for vegetable production would have been woefully inadequate, had the beneficiaries tried to use it for the 27 hectares of subtropical fruits. Thus, supporting small-scale production may also be favourable to the government, since it requires less financial support and it may be easier to provide training and extension for beneficiaries in this domain.
Total Inputs Expenditure, 2008
Even with regard to disease and pest control, the small-scale model allowed the beneficiaries at Elangeni to cope better than they did in large-scale fruit production. When they had a contract to supply organic vegetables to Woolworths (2008–2012), there was less emphasis on manufactured chemicals than the use of indigenous resources on, or around, the farm. The beneficiaries were taught natural methods for disease and pest control by the agronomist from the retailer. With regard to disease control Sophie M. said:
When we started, there was another smelly tree. You see, garlic is a good chemical. We boil it, mix it with chillies, and another smelly tree called Manganyi. We also boil this tree and mix it with the other mixture. We pour the mixture into the areas affected by diseases. You will not find anything eaten. (Sophie M., personal interview, 18 July 2012)
The skills that Woolworths transferred to the beneficiaries minimized the cost of pest and disease control. The feasibility of using the natural methods was enhanced by the small-scale model of production. The methods could be difficult to apply in a large-scale production set-up. This is probably why intensive usage of agrochemicals is common in large-scale production (Landless Rural Workers’ Movement [MST], 2013). Where chemicals were used to control diseases and pests, the small scale nature of production allowed the beneficiaries to achieve the task with little resources expended.
On the contrary, controlling diseases and pests on the 27 hectares of subtropical fruits required more resources. According to Subtrop, R2,500 (R42,500 for the 17 hectares at Elangeni) was required for pest control per hectare of mangoes in 2006 (Subtrop, 2013, Mango production costs 2006). That figure did not only exclude the 10 hectares of avocados, it also excluded the cost for disease control. The basic spraying programme has three stages in the season, focussing on disease and pest control. During the flower bud development stage (May to July), a sanitization spray should be done to control fungal and bacterial diseases (Elangeni Spraying Programme for Fruits, 2013). In the flowering and fruit set stage (August to October), diseases such as powdery mildew and pests such as gall fly should be controlled. From fruit growth up to harvest (October to February), diseases such as anthracnose and pests such as termites and fruit flies should be controlled through sprays. Some diseases can be ignored, but others can destroy the whole crop if not controlled (Marius P., personal interview, 27 August 2013). 4
Thus, input costs are high on large-scale production, whether crops are produced organically or conventionally. Because the beneficiaries did not have adequate resources to invest on spraying, only copper was used to control worms in mangoes and black spots on avocados. The children had purchased 625 kg of copper for R22,500 in 2010 (Elangeni Farm Book, 2013). The effect of the failure to adequately spray the trees was reduced access to the lucrative markets with strict market standards (Rusenga, 2017).
Although crop type also influences the inputs budget, the scale of production does affect the cumulative amount of resources spent on inputs. For instance, when producing one hectare of organic green beans, seven litres of biotrissol (liquid fertilizer) is needed (Elangeni Fertiliser and Spraying Programme for Organic Vegetables, 2013), among other chemicals, costing R1,470. 5 Many beneficiaries may mobilize resources needed for input costs for small-scale production (see Scoones et al., 2011, for Zimbabwe’s A1 beneficiaries). However, as the scale of production grows, the cumulative cost for inputs increases beyond the ability of many beneficiaries. Thus, R14,700 needed to buy biotrissol for 10 hectares of green beans is not easy to mobilize, compared to, say, R1,470 for one hectare. After all, this is just one chemical among a number that are applied, such as Dipel, Kanguard, and KangroShield 100. Indeed, large-scale production does affect the ability of many land reform beneficiaries in the context of limited external post-settlement support.
The labour requirements for large-scale production also present challenges to the beneficiaries at Elangeni. On average, there are eight ‘permanent’ farmworkers on the project throughout the year, including Sophie M. and her husband Samuel M. 6 About 20 seasonal workers are brought in during the mango and avocado harvests. While the eight workers ‘sustained’ production on the four hectares of organic vegetables, their labour was inadequate to sustain the 27 hectares of mangos and avocados. Despite challenges, there was consistent production of organic vegetables at Elangeni between 2008 and 2013. However, the production of subtropical fruits (on a large scale) has always been affected by inadequate labour, among other factors.
The orchards where affected by a hail storm (in 2010) and veld fire (in 2012). A combination of inadequate labour and financial resources affected the ability of the beneficiaries to resuscitate the orchards. As shown by Samuel M earlier, the pruning of 27 hectares of trees required a lot of resources, not only financial, but also in terms of labour. The failure to provide enough care for the trees affected the output. From the 2010/2011 season up to 2012/2013, no harvests were made, as the trees had to recover naturally. However, even before the natural disasters, the failure to provide enough care to the orchards, due to inadequate labour and other resources, affected the output at Elangeni. While a hectare of mangoes should produce a peak yield of between 25 and 30 tons (Subtrop, 2013, Mango production costs 2006), in their best year (2008/2009) the beneficiaries produced 40,360 kg of mangoes and generated R46,608 (Elangeni Farm Book, 2013). This translates to an average of 2.4 tons per hectare, clearly showing that the beneficiaries were not successful in large-scale subtropical fruit production. Although many factors contributed to low production outputs at Elangeni, inadequate labour played a big role. While it is possible for a farmer not to spray any chemicals, the core activities such as pruning and weeding require labour. And, the agribusiness model makes it difficult for the beneficiaries, as the labour requirements are higher compared to the small-scale model.
The higher costs associated with large-scale production also affected the beneficiaries’ ability to produce more and quality jobs. Precarious, short-term, and insecure jobs were created. The farm workers partially dealt with the poor working conditions by migrating to other farms when better employment opportunities emerged. However, precariousness, prevalent in the large-scale commercial sector since the 1950s (Atkinson, 2007), has been worsened in the projects by the beneficiaries’ inability to produce using the costly agribusiness model. In spite of their failure to guarantee quality jobs, the beneficiaries continued to access cheap labour fuelled by high poverty levels in the workers’ households. The wages paid to the workers were below the R105 minimum daily wage rate instituted by the Department of Labour (DoL) in 2013. The beneficiaries applied to the department for an exemption to paying such wage rates, on the basis that they could have been forced to shut down the operations. Nevertheless, the decrease of employment in the large-scale commercial farms (Statistics South Africa [Stats SA], 2009) make land reform projects a serious rural employment option for the poor.
Additionally, where large-scale production takes place, sophisticated machinery is normally acquired, requiring huge resources. The list of implements that Elangeni has (see Table 3) shows that the choices were influenced by the large-scale, capital-intensive nature of subtropical fruit production. More than R500,000 was spent on farm implements aimed at facilitating large-scale production.
Production Equipment at Elangeni
The DRDLR released the balance of the grant, totalling R500,000 in 2011. The balance of the grant is the money that remains after the cost of the farm has been subtracted from the total allocated grant. With little flexibility on how the money should be spent, the DRDLR used the grant to buy a few implements, including a tractor that cost R400,000 and a bakkie (costing R70,000). After successfully applying for a grant worth R350,000 from the Department of Trade and Industry (DTI) under the Cooperative Incentive Scheme (CIS) in 2012, the conditions of the grant restricted its use towards the purchase of farm equipment. By September 2013, only around R100,000 of the grant had been used to buy additional equipment.
The above-mentioned support was important for the beneficiaries. However, its impact could have been greater, had the resources been used differently. For instance, buying a second hand-tractor could have left plenty of money to cover other costs. The state spent R3 million in total at Elangeni alone, which others can argue is substantial support to the beneficiaries. But 72 per cent of that sum went towards the purchase of the farm alone. The remaining R850,000 was spent on, or reserved for, the purchase of farm implements only. Operational costs for labour, inputs, electricity, fuel, and maintenance of the equipment remain catered for through either farm savings or off-farm income invested in the farm. Off-farm income is the driving factor for production.
The list of equipment in Table 3 reveals how capital-intensive production is under the agribusiness model. If the beneficiaries struggled for operational capital, despite the state having invested R3 million on the farm, surely the agribusiness model is not financially feasible. With many beneficiaries not as fortunate as those at Elangeni in terms of mobilizing production resources, this means that they will likely be less successful when producing on a large scale. This makes the call for support for the small-scale model of farming of less capital-intensive crops more important.
Conclusion: Towards an Inclusive Agrarian Model
The discussion questioned the rationale for the South African government to promote large-scale production among the land reform beneficiaries. Despite the evidence showing that large-scale production is costly beyond the ability of many land reform beneficiaries (Aliber & Cousins, 2013; Rusenga, 2017) the government insists on the preservation of large-scale production systems. Is there evidence anywhere in the world, let alone in Africa, of poor rural people succeeding in large-scale production? I have not seen it myself. Land has been part of many people’s livelihoods in the Global South. However, many of those people do not use their land within the mainstream models of agrarian capitalism. In the context of Southern Africa, the works of Arrighi (1970), Bundy (1979), Ncapayi (2013), and Mabandla (2015) all point to a long tradition of combining land and labour (wages) as part of livelihood strategies by black Africans, but outside the mainstream models of agrarian capitalism.
Is it not paradoxical that large-scale production enjoys hegemony both nationally and globally, despite many farmers struggling to produce using the model? Because it serves the interests of global capital, large-scale production is presented as the perfect model in mainstream knowledge production dominated by Northern theory. It fits properly into the large agricultural system controlled by agribusiness, with the latter also dominating downstream and upstream agricultural value chains; hence the argument in this article that we are experiencing an agribusiness model for which large-scale production is an important component (Rusenga, 2017). The othering of alternative models, such as the small scale, is achieved through the skewed politics of knowledge production which advance a narrative that everything coming from, or supported by the North, is good (Connell, 2007). Indeed, as argued by Connell (2007) Northern theory marginalizes the experiences of many people in the Global South. As such, important works of scholars such as Mafeje (2003) and Cousins (2013) on the suitability of the small-scale model for black Africans gets ignored by those in charge of agrarian policy in South Africa, and the Global South at large. This article presented data from the Elangeni project to demonstrate how the huge costs associated with large-scale production hinders the land reform beneficiaries from producing effectively using their off-farm income, which is an important production resource. It argued that the small-scale model can facilitate the investment of off-farm income in agriculture by the resource-constrained land reform beneficiaries. Even for the government, the small-scale model can make it easy to provide support and extension.
What is the level and rate of agricultural success at Elangeni project? The fact that, since 2008, the beneficiaries were able to sustain organic vegetable production using mainly off-farm income, while failing to do the same with fruit production, attests to the efficiency of the small-scale model, even for those with limited resources and depending on household off-farm income. Indeed, it is through the proceeds from the small-scale model and off-farm income that the hired workers (six at most) receive their wages. Thus, although more needs to be done to improve capacity of the beneficiaries, the small-scale model is more suited to their capabilities than the agribusiness model.
Footnotes
Declaration of Conflicting Interests
The author declared no potential conflicts of interest with respect to the research, authorship and/or publication of this article.
Funding
The author received no financial support for the research, authorship and/or publication of this article.