Ray Smith returns from SDARL's study of South Africa's agriculture
Ray Smith, Philip, and the rest of the South Dakota Agriculture and Rural Leadership (SDARL) class, has returned from a study of agricultural practices in South Africa.
Smith was the only Haakon County representative in the SDARL Class V trip. He was told that South Africa is in an uneasy post-Apartheid transition. The government, now run by the black population, has mandated that by the year 2011, 30 percent of all ag land is to be bought by the government and turned back to the blacks. Smith observed, "That program is not going well and has to do with lack of education and capital. It is a huge problem of a mixed culture that is not working." Smith was told that only about 30 percent of the country's total land is useable for agriculture. In lectures and face-to-face discussions by various professionals, Smith learned that there are currently an approximate 4,300 farmers/ranchers and 3,500 dairies in South Africa.
As an agriculture banker, Smith noted that the interest rate on loans in South Africa range between 10.5 and 14 percent. Interest rate of deposits is as high as seven percent. "But there is eight percent inflation, so it is diluted somewhat," said Smith. He observed that most of the large producers were operating off of their own capital. Smith said that tour speaker, agriculture banker Ernst Janovsky, told the SDARL group that South African agricultural land has risen to four times its value since 1994.
The class visited the Karan Beef feedlot, which can accommodate over 120,000 head, thus is the largest privately owned feedlot in the southern hemisphere. It owns the largest feed mill of its kind in the world, capable of producing up to 1,000 tons of mixed feed per day. It owns its own "abattoir," or slaughter and packing house, that processes 1,000 head per day.
Smith said, "Feedlots don't really have a way to hedge, or forward contract, their pricing." So, Karan Beef, by owning the process from feedlot through butcher and packaging, can sort of control prices.
Smith said that he ate a lot of beef and maize-meal while there. There was endless variety of hamburger (minced meat) and jerky. "The beef is quite a bit leaner than ours, though still good," said Smith. "Instead of grading meat by marbling, they grade it by age and the amount of fat covering the ninth, 10th and 11th ribs," he said. Smith related, "There is a shortage of large animal vets, only 32 in the whole country, who have to deal with the game farms and the cattle producers." The South Africa farmers raise beef, lamb and chicken for livestock, but not much pork.
One farmer/guide that Smith talked to said that South Africa is use to cheap labor, which is an advantage, but they will have to soon plan for mechanization because of the loss of labor to AIDS. Smith was told by the owner of a huge mango farm that 40 percent of this year's workers will not return next years because they will be dead of AIDSâ
or be caring for family members dying of AIDS. South Africa is estimated to lose 20 percent of its population by 2015.
Concerning the medical field in South Africa, Smith reported that a guide said, "If you wanted to die, go to state medical care." The guide then said that the country's private medical care was one of the best in the world. He said the Europeans come on "medical safari" for various procedures because the quality is good and the cost is lower than in many parts of Europe. The guide related that a knee replacement cost around 30,000 rand, or about $4,000. The guide also complained that his medical health insurance cost him an equivalent of $266 per month. Much, if not all, of the black population totally believe in "sangoma" healers who throw and read bones to give diagnoses and treatment.
The SDARL trip included many game drives - some drive-throughs for sight-seeing and some for hunting of the many species artificially raised there. It is predicted that such tourism will soon become the country's number one industry. The class also visited huge olive farms, which raise approximately 90 percent of their crops for oil and 10 percent for table use. Wineries are common in the Cape area of South Africa, specializing in French and German wines, as well as the Pinotage wine, a South African cultivar.
The class toured the Embryo Plus Centre, which specializes in embryo transfers. In recent years it has exported approximately 12,000 embryos of breeds like brahman, simmentaler, bonsmara, sentrapol, boran, brangus, redpole, simbra and south devon to Canada, United States, Brazil, Argentina, Australia and many African countries.
Smith felt that he simply could not describe the expansive beauty of the mountains, river gorges and rolling plains (velds) of the country. He felt the same about how disheartening was the poor educational system of the country, which will hurt the country for a long time to come. "South Africa has great potential with abundant natural resources, cheap labor, fertile land, etc," said Smith, "but since Apartheid, the government has taken the contry backwards and shown no signs of correcting the many problems that exist."