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Millions needed to save farms

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“It is estimated that the fiscal impact of the abovementioned production leads to an estimated R780 million contribution to taxes throughout the economy.”

Severe drought conditions in Garries and Aggeneys. Picture: Gideon Jacobs

MORE than 15 500 farms in the Northern Cape, covering more than 20 million hectares are severely affected by the drought and R425 million is needed over the next three months to assist affected farmers.

This is according to Agri Northern Cape Agriculture Drought Report 2019/2020, which warns that the direct impact of the current drought will be disastrous to the economy of the Province.

According to the report which was released on Wednesday, during April 2019 it was reported that almost 10 000 farms in the Province, with a carrying capacity of 166 000 large stock units, covering more than 5.8 million hectares had experienced prolonged drought.

This has escalated to a current situation where more than 15 500 farms covering more than 20 million hectares are severely affected

“This relates to 613 447 LSUs (livestock units) which are affected, while the total area affected by the potential disaster drought in the Province is 27 157 247 ha with a carrying capacity of 1 068 408 LSUs (livestock units),” the report states.

Given the current values of products and levels of production, it is estimated that the value of production during a normal situation in the affected area, would amount to R2.53 billion per annum.

The Vegetation Condition Index which uses 23 years of data, supports the drought as observed on ground level.

“The VCI map for September 2019 shows that the Northern Cape remains under severe drought conditions, as shown by the poor levels of vegetation activity.

“If the knock-on effect of backward and forward linkages to the rest of the economy is added, the total value of production for the entire economy is estimated at R7.85 billion per annum.”

The report states further that it is estimated that production in the affected area will employ 13 827 full-time equivalent jobs and with the backward and forward linkages to the rest of the economy, it is responsible for 22 437 full-time equivalent jobs throughout the economy.

“It is estimated that the fiscal impact of the abovementioned production leads to an estimated R780 million contribution to taxes throughout the economy.”

The direct impact of this current drought and potential escalation if the drought prevails will be disastrous to the economy of the Northern Cape Province, the report states.

“In order to assist currently affected farmers with drought relief, R425 million will be required over a three-month period.

“This amount will escalate to R612 million if below-average rainfall continues and the drought intensifies towards December 2019.”

Focusing on how farmers farmers managed to feed their animals in 2019, it was pointed out that all farmers (commercial, emerging, small-scale and subsistence) had received aid from fundraising projects and donations.

These actions are driven by NGOs like Agri Northern Cape, Agri SA, Gift of the givers, “Save the sheep” and numerous other groups as well as business and individuals.

Organised agriculture contributed R10.9 million, with donations amounting to R649,114 and private farmers contributed R3.2 million, realising a total of R14.8 million.

The government donated R30 million towards drought relief in the Province.

A breakdown of affected farmers and the cost of relief shows that 2 500 commercial farmers are currently affected. With a LSU of 30, the cost per day is estimated at R45 a day. Over a 90 days period the total cost of funding required is R303.75 million.

In terms of emerging farmers, the total number of farmers currently affected is 3 s000. With a LSU of 10, the funding needed over the next 90 days is R121.5 million. This brings the total number of affected farmers currently at 5 500 and the total amount needed for relief is R424.25 million.

In terms of the potential number of affected farmers and the cost of relief if the drought continues, the number of affected jumps to 9 000 (4 000 commercial and 5 000 emerging). The relief costs of a 90 day period amounts to a total of R688.5 million.

In terms of summer crops (maize, soybeans, sunflower, sorghum and peanuts) irrigation farmers in the Northern Cape could not obtain enough financing due to too much debt.

Regarding the effects of climate change on agriculture (from the Greenbook on the Climate Change Impacts on Agriculture, Forestry & Fisheries) it is pointed out that the most significant rise in temperatures will be over the central and northern parts of the country.

“Overall, it is anticipated that future increases in temperature and evaporation will result in an increase in the irrigation demands across the country. Areas that are generally most at risk in terms of climate impacts are those where agriculture makes a large contribution to the gross value added (GVA) and employment of an area, and where rainfall is projected to decrease, while also associated with rapid warming – effectively the northwestern and central parts of the Western Cape, large areas of the Northern Cape, as well as western parts of the Eastern Cape and southwestern areas of the Free State.”

The central and Hantam Karoo in the Western and Northern Cape is expected to experience higher temperatures and more intense heat waves, more frequent and longer dry spells and droughts. This vast area depends largely on extensive livestock farming (cattle, sheep, goats and ostriches).

Livestock farming will be primarily impacted by rangeland vegetation changes, changes in the distribution of pests and diseases and water availability. An increase in maximum temperature will lead to increased heat stress for livestock, but also lower risks associated with low temperatures in colder areas. As shown earlier, livestock farming plays a significant role in providing sustenance to poor communities and stabilizing the economies of towns in these areas.

The report came with a stern warning from Agri SA that the prevailing drought conditions throughout the country could collapse rural economies and decimate the country’s entire agricultural industry.

The lobby group said in its drought report that farmers faced potential foreclosure by banks and that those whose farms would not be attached would be unable to obtain any production credit to plough maize.

Agri Northern Cape deputy president and head of Agri SA disaster management centre Willem Symington said farmers had taken massive financial losses with 37.5% of rural South Africa affected.

“Yields per year are down and farmers are planting less,” Symington said.

“In animal production we see lessened production due to drought. In the Western Cape we have seen a loss of 25 percent in the value of export crops. They are also shedding jobs due to drought. Job losses are around 20 to 25 percent in the Northern Cape and the Free State.”

Agri SA said grain and livestock producers had been particularly affected by the unnatural dry weather conditions, below normal rainfall and warm weather.

The group said several Karoo towns had suffered the same fate as boreholes and dams had dried up.

Symington said while South Africa was one of the most food secure countries in the world the current drought could result in an entire economic downturn.

“As a country, we are not managing climatic disasters very well,” he said. “We have a lot of work to do. Drought can change our status as a food secure country.”

Grain SA chief executive Jannie de Villiers said South Africa had only received close to half the rain it required.

De Villiers said this meant that farmers could be forced to plant only 10 percent more compared to last year.

“The quality of the grains produced are not up to scratch,” De Villiers said.

“We are late, we are worried, we are not in a crisis yet, but have real concerns. We are pleading with the government for an insurance system for these kinds of situations to maintain our food security.”

Agri SA executive director, Omri van Zyl, said they had made recommendations to the government, including the establishment of a National Drought Management Commission to focus on providing the government with an effective and systematic means of assessing drought conditions, and establishing a Disaster Fund.