Agricultural public spending, growth and poverty linkage hypotheses in the Eastern Cape Province of South Africa
- Authors: Ndhleve, Simbarashe
- Date: 2012
- Subjects: Poverty -- Economic aspects -- South Africa -- Eastern Cape , Rural poor -- South Africa -- Eastern Cape , Sustainable development -- South Africa -- Eastern Cape , Rural development -- South Africa -- Eastern Cape , Agricultural industries -- South Africa -- Eastern Cape , Government spending policy -- South Africa -- Eastern Cape , Finance, Public -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Doctoral , PhD (Agricultural Economics)
- Identifier: vital:11157 , http://hdl.handle.net/10353/493 , Poverty -- Economic aspects -- South Africa -- Eastern Cape , Rural poor -- South Africa -- Eastern Cape , Sustainable development -- South Africa -- Eastern Cape , Rural development -- South Africa -- Eastern Cape , Agricultural industries -- South Africa -- Eastern Cape , Government spending policy -- South Africa -- Eastern Cape , Finance, Public -- South Africa -- Eastern Cape
- Description: The adoption of the Millennium Development Goal 1 (MDG1) of reducing the rate of poverty to half of the 1990-level by 2015, the advent of democracy in South Africa, among other things, have raised concerns over the potential role of the agricultural sector. There is a belief that the sector has the capacity to successfully reduce poverty among the rural masses and contribute to addressing the problem of inequality in South Africa. In line with that thinking, South Africa‘s agricultural sector has attracted considerable fiscal policy interest. For instance, South Africa‘s statistics show that public investments in agricultural development programmes have been growing. In spite of this, rural poverty is still a major concern on an overall basis. However, this might not be the case in the Eastern Cape Province and the situation might be different for each district municipality. This study assesses the linkages between public agricultural investment, agricultural growth and poverty reduction in the Eastern Cape Province. The study also addresses the question whether Eastern Cape Province is on course to meet several regional development targets. The study also aims to provide an estimate of the amount of agricultural investment required to attain the agricultural productivity growth rate which is sufficient to meet MDG1. The study reviewed the various theories of public spending, linkages between public investment and agricultural growth and how these components affect the incidence of poverty. The conventional wisdom that public expenditure in agriculture positively affects economic growth and this growth consequently reduces poverty was noted. The reviews also revealed that in many developing countries, the current level of public agricultural investment needs to be increased significantly for countries to meet the MDG1. This study employed the decomposition technique and growth elasticity of poverty concept to estimate the response of poverty to its key determinants. The size of public spending, prioritization of public spending and the intensity in the use of public funds emerged as important in increasing agricultural production. The relationship between government investment in agriculture and agricultural GDP shows iv that public funds were largely behind the province‘s success in increasing agricultural production throughout the period from 1990s to 2010. Agricultural spending went to sustainable resource management, administrative functions and then farmer support programme. Exceptional growth in the size of spending was recorded in respect to agricultural economic function, structured agricultural training, sustainable resource management and veterinary services. Overall output from the agricultural sector fluctuated, and the sector contributed less than 5 per cent to the total provincial GDP. Correlations between growth in agricultural sector and changes in the incidence of poverty in Eastern Cape show that during the period 1995 to 2000, increases in the agricultural GDP per capita may have failed to benefit the poor as poverty increased in all the reported cases.–However, for the period between 2005 and 2010, the situation was different and it was observed that increases in agricultural GDP per capita and were associated with reduction in the incidence of poverty. Growth elasticity of poverty (GEP) estimates reveal that agricultural GDP per capita was more important in reducing poverty in 5 out of the 7 district municipalities. Non-agricultural GDP per capita was only important in two district municipalities. It emerged that most of the district municipalities are not in a position to meet any of the regional set goals. This situation is largely attributable to the province‘s failure to boost agricultural production which is an outcome of low and inefficient public expenditure management, inconsistent and misaligned policies and failure to fully embrace the concept of pro-poor growth. Varied provisional estimates for the required agricultural growth rate and the increase in public spending on agriculture required in order to reach MDG1 were calculated for each district municipalities. All the district municipalities of Eastern Cape will need to increase public investment in agriculture for them to achieve MDG1.
- Full Text:
- Authors: Ndhleve, Simbarashe
- Date: 2012
- Subjects: Poverty -- Economic aspects -- South Africa -- Eastern Cape , Rural poor -- South Africa -- Eastern Cape , Sustainable development -- South Africa -- Eastern Cape , Rural development -- South Africa -- Eastern Cape , Agricultural industries -- South Africa -- Eastern Cape , Government spending policy -- South Africa -- Eastern Cape , Finance, Public -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Doctoral , PhD (Agricultural Economics)
- Identifier: vital:11157 , http://hdl.handle.net/10353/493 , Poverty -- Economic aspects -- South Africa -- Eastern Cape , Rural poor -- South Africa -- Eastern Cape , Sustainable development -- South Africa -- Eastern Cape , Rural development -- South Africa -- Eastern Cape , Agricultural industries -- South Africa -- Eastern Cape , Government spending policy -- South Africa -- Eastern Cape , Finance, Public -- South Africa -- Eastern Cape
- Description: The adoption of the Millennium Development Goal 1 (MDG1) of reducing the rate of poverty to half of the 1990-level by 2015, the advent of democracy in South Africa, among other things, have raised concerns over the potential role of the agricultural sector. There is a belief that the sector has the capacity to successfully reduce poverty among the rural masses and contribute to addressing the problem of inequality in South Africa. In line with that thinking, South Africa‘s agricultural sector has attracted considerable fiscal policy interest. For instance, South Africa‘s statistics show that public investments in agricultural development programmes have been growing. In spite of this, rural poverty is still a major concern on an overall basis. However, this might not be the case in the Eastern Cape Province and the situation might be different for each district municipality. This study assesses the linkages between public agricultural investment, agricultural growth and poverty reduction in the Eastern Cape Province. The study also addresses the question whether Eastern Cape Province is on course to meet several regional development targets. The study also aims to provide an estimate of the amount of agricultural investment required to attain the agricultural productivity growth rate which is sufficient to meet MDG1. The study reviewed the various theories of public spending, linkages between public investment and agricultural growth and how these components affect the incidence of poverty. The conventional wisdom that public expenditure in agriculture positively affects economic growth and this growth consequently reduces poverty was noted. The reviews also revealed that in many developing countries, the current level of public agricultural investment needs to be increased significantly for countries to meet the MDG1. This study employed the decomposition technique and growth elasticity of poverty concept to estimate the response of poverty to its key determinants. The size of public spending, prioritization of public spending and the intensity in the use of public funds emerged as important in increasing agricultural production. The relationship between government investment in agriculture and agricultural GDP shows iv that public funds were largely behind the province‘s success in increasing agricultural production throughout the period from 1990s to 2010. Agricultural spending went to sustainable resource management, administrative functions and then farmer support programme. Exceptional growth in the size of spending was recorded in respect to agricultural economic function, structured agricultural training, sustainable resource management and veterinary services. Overall output from the agricultural sector fluctuated, and the sector contributed less than 5 per cent to the total provincial GDP. Correlations between growth in agricultural sector and changes in the incidence of poverty in Eastern Cape show that during the period 1995 to 2000, increases in the agricultural GDP per capita may have failed to benefit the poor as poverty increased in all the reported cases.–However, for the period between 2005 and 2010, the situation was different and it was observed that increases in agricultural GDP per capita and were associated with reduction in the incidence of poverty. Growth elasticity of poverty (GEP) estimates reveal that agricultural GDP per capita was more important in reducing poverty in 5 out of the 7 district municipalities. Non-agricultural GDP per capita was only important in two district municipalities. It emerged that most of the district municipalities are not in a position to meet any of the regional set goals. This situation is largely attributable to the province‘s failure to boost agricultural production which is an outcome of low and inefficient public expenditure management, inconsistent and misaligned policies and failure to fully embrace the concept of pro-poor growth. Varied provisional estimates for the required agricultural growth rate and the increase in public spending on agriculture required in order to reach MDG1 were calculated for each district municipalities. All the district municipalities of Eastern Cape will need to increase public investment in agriculture for them to achieve MDG1.
- Full Text:
Impact of animal traction power on agricultural productivity: case of lowlands of Mohale's Hoek district of Lesotho
- Rampokanyo, Lepolesa Michael
- Authors: Rampokanyo, Lepolesa Michael
- Date: 2012
- Subjects: Animal traction -- Lesotho , Agricultural productivity -- Lesotho , Draft animals -- Lesotho , Food security -- Lesotho , Farm produce -- Lesotho
- Language: English
- Type: Thesis , Masters , MSc Agric (Agricultural Economics)
- Identifier: vital:11178 , http://hdl.handle.net/10353/483 , Animal traction -- Lesotho , Agricultural productivity -- Lesotho , Draft animals -- Lesotho , Food security -- Lesotho , Farm produce -- Lesotho
- Description: Most farming at subsistence level is located in rural areas where the majority of smallholder farmers have low productivity which results in high rate of food insecurity. The areas are characterised by animal traction and poor farming practises, and monoculture is mostly preferred. In light of this, this study analyzed the impact of animal power on agricultural productivity. Smallholder farmers in the lowlands of Mohale’s Hoek district of Lesotho were investigated by means of a case study methodology. The aim of the study was to inform agricultural policy about the level and key determinants of inefficiency in the smallholder farming system so as to contribute to policy designed to raise productivity of smallholder farmers. The sampling frame comprised farmers and extension workers in the lowlands of Mohale’s Hoek district. From this frame, 118 farmers and 4 extension workers were randomly selected from four villages, namely‘Mapotsane, Potsane, Tsoloane and Siloe. The four groups of farmers include; the farmers owning and using cattle for ploughing, farmers owning tractor and cattle and using them for ploughing, farmers owning tractor only and using it for ploughing, and farmers who owned neither cattle nor tractor and normally hire these when ploughing operations are to be done on the farm. The interviews of these farmers and extension workers were conducted by means of semi-structured questionnaire which consisted of both open and close ended questions. The study used the stochastic frontier production model for the production efficiencies and linear regression model for the impact of animal traction on agricultural productivity. Both procedures provided insights into the relative contributions of animal power and traditional systems to poverty alleviation and food security in the project areas. Descriptive statistics were employed for farming systems and challenges facing small scale farmers. Gross Margins analysis was conducted for the animal power and tractor power yield levels for maize crop to compare the two types of power. Some diagnostic tests to detect serial correlation and heteroskedasticity and t-tests were also performed. The significant variables include the area of sorghum ploughed, members of the household that assist with family labour, education, quantity of fertilizer applied, time taken by the farmers in farming, members who are formally employed, household size, area of land ploughed, old age, costs of tractor and animal, marital status, income, area of maize ploughed, area of sorghum ploughed, quantity of fertilizers applied, costs of seeds and fertilizers applied, maize and sorghum yield and amount sold and consumed. The study revealed that monoculture is mainly practised and many smallholder farmers used traditional technologies that fail to replace nutrients in the soil. Nonetheless family labour was not a problem. During the farming season, tractors were used as the main source of power for ploughing. Most farmers hired these for maize production as it is a staple food crop even where animal power is available. It was noted that the tractors were few and in most cases old and malfunctioning. The cost of using animals in farming obviouslyplayed a role in the production of both maize v and sorghum in the lowland areas of Mohale’s Hoek district. Smallholder farmers who owned both tractors and animals produced more but they were mainly affected by high costs of maintaining the aging tractors, generally purchased on the used-equipment market. The increased challenges resulted in lower productivity of the smallholder farmers, including: unhealthy animals, drought, marketing problems, late ploughing, poor soils, lack of extension services, low yields, low income, lack of information, lack of appropriate implements, lack of support services, nutrition inadequacy, inappropriate farming systems. The study recommended the adoption and promotion of low-cost mechanization in the lowlands of Mohale’s Hoek district so as to increase the production of the smallholder farmers. Increased productivity will in turn improve household food security.
- Full Text:
- Authors: Rampokanyo, Lepolesa Michael
- Date: 2012
- Subjects: Animal traction -- Lesotho , Agricultural productivity -- Lesotho , Draft animals -- Lesotho , Food security -- Lesotho , Farm produce -- Lesotho
- Language: English
- Type: Thesis , Masters , MSc Agric (Agricultural Economics)
- Identifier: vital:11178 , http://hdl.handle.net/10353/483 , Animal traction -- Lesotho , Agricultural productivity -- Lesotho , Draft animals -- Lesotho , Food security -- Lesotho , Farm produce -- Lesotho
- Description: Most farming at subsistence level is located in rural areas where the majority of smallholder farmers have low productivity which results in high rate of food insecurity. The areas are characterised by animal traction and poor farming practises, and monoculture is mostly preferred. In light of this, this study analyzed the impact of animal power on agricultural productivity. Smallholder farmers in the lowlands of Mohale’s Hoek district of Lesotho were investigated by means of a case study methodology. The aim of the study was to inform agricultural policy about the level and key determinants of inefficiency in the smallholder farming system so as to contribute to policy designed to raise productivity of smallholder farmers. The sampling frame comprised farmers and extension workers in the lowlands of Mohale’s Hoek district. From this frame, 118 farmers and 4 extension workers were randomly selected from four villages, namely‘Mapotsane, Potsane, Tsoloane and Siloe. The four groups of farmers include; the farmers owning and using cattle for ploughing, farmers owning tractor and cattle and using them for ploughing, farmers owning tractor only and using it for ploughing, and farmers who owned neither cattle nor tractor and normally hire these when ploughing operations are to be done on the farm. The interviews of these farmers and extension workers were conducted by means of semi-structured questionnaire which consisted of both open and close ended questions. The study used the stochastic frontier production model for the production efficiencies and linear regression model for the impact of animal traction on agricultural productivity. Both procedures provided insights into the relative contributions of animal power and traditional systems to poverty alleviation and food security in the project areas. Descriptive statistics were employed for farming systems and challenges facing small scale farmers. Gross Margins analysis was conducted for the animal power and tractor power yield levels for maize crop to compare the two types of power. Some diagnostic tests to detect serial correlation and heteroskedasticity and t-tests were also performed. The significant variables include the area of sorghum ploughed, members of the household that assist with family labour, education, quantity of fertilizer applied, time taken by the farmers in farming, members who are formally employed, household size, area of land ploughed, old age, costs of tractor and animal, marital status, income, area of maize ploughed, area of sorghum ploughed, quantity of fertilizers applied, costs of seeds and fertilizers applied, maize and sorghum yield and amount sold and consumed. The study revealed that monoculture is mainly practised and many smallholder farmers used traditional technologies that fail to replace nutrients in the soil. Nonetheless family labour was not a problem. During the farming season, tractors were used as the main source of power for ploughing. Most farmers hired these for maize production as it is a staple food crop even where animal power is available. It was noted that the tractors were few and in most cases old and malfunctioning. The cost of using animals in farming obviouslyplayed a role in the production of both maize v and sorghum in the lowland areas of Mohale’s Hoek district. Smallholder farmers who owned both tractors and animals produced more but they were mainly affected by high costs of maintaining the aging tractors, generally purchased on the used-equipment market. The increased challenges resulted in lower productivity of the smallholder farmers, including: unhealthy animals, drought, marketing problems, late ploughing, poor soils, lack of extension services, low yields, low income, lack of information, lack of appropriate implements, lack of support services, nutrition inadequacy, inappropriate farming systems. The study recommended the adoption and promotion of low-cost mechanization in the lowlands of Mohale’s Hoek district so as to increase the production of the smallholder farmers. Increased productivity will in turn improve household food security.
- Full Text:
Implications of food value chain support structures for water resource management by smallholder farmers in the Eastern Cape Province
- Authors: Arowolo, Steven Alaba
- Date: 2012
- Subjects: Agricultural assistance -- South Africa -- Eastern Cape , Agricultural productivity -- South Africa -- Eastern Cape , Agricultural extension work -- South Africa -- Eastern Cape , Agricultural development projects -- South Africa -- Eastern Cape , Rural development -- South Africa -- Eastern Cape , Farm produce -- South Africa -- Eastern Cape -- Marketing , Sustainable development -- South Africa -- Eastern Cape , Water resources development -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Masters , MSc Agric (Agricultural Economics)
- Identifier: vital:11181 , http://hdl.handle.net/10353/d1001027 , Agricultural assistance -- South Africa -- Eastern Cape , Agricultural productivity -- South Africa -- Eastern Cape , Agricultural extension work -- South Africa -- Eastern Cape , Agricultural development projects -- South Africa -- Eastern Cape , Rural development -- South Africa -- Eastern Cape , Farm produce -- South Africa -- Eastern Cape -- Marketing , Sustainable development -- South Africa -- Eastern Cape , Water resources development -- South Africa -- Eastern Cape
- Description: Smallholder agriculture is faced with so many challenges despite all the policies and programmes that have been channelled towards ensuring improvement in this sector. Improving smallholder agricultural productivity requires that smallholder farmers gain access to reliable and adequate farmer support services such as physical infrastructures like good road network, functional irrigation facilities, extension services, finance and efficient marketing system. However, these support services are lacking in a vast majority of the rural communities in which the smallholder farmers live and work. This study is centred on governance within the food value chains, with specific focus on butternuts and chicken value chains;with a view to identifying those factors preventing smallholder farmers from accessing the mainstream market. Ciko and Mbozi villages in Mbashe local municipality were used as the research sites for the study. Data were collected across the two villages through sampling of 100 individual farming households based on random selection; questionnaires and checklist of questions were used as tools to access information from farmers through focus group discussions, personal interviews and key informants. In addition,Ciko Santrini project and foundation community project, which are the two agricultural community projects located within the study area were also investigated. Conceptual and analytical frameworks were employed in the research analysis. Williamson’s 4-level of social analysis and the sustainable livelihood frameworks were used to conceptualize the analysis. Inferential analysis was carried out using binary logistic regression and discriminant analysis with focus on butternuts and cSmallholder agriculture is faced with so many challenges despite all the policies and programmes that have been channelled towards ensuring improvement in this sector. Improving smallholder agricultural productivity requires that smallholder farmers gain access to reliable and adequate farmer support services such as physical infrastructures like good road network, functional irrigation facilities, extension services, finance and efficient marketing system. However, these support services are lacking in a vast majority of the rural communities in which the smallholder farmers live and work. This study is centred on governance within the food value chains, with specific focus on butternuts and chicken value chains;with a view to identifying those factors preventing smallholder farmers from accessing the mainstream market. Ciko and Mbozi villages in Mbashe local municipality were used as the research sites for the study. Data were collected across the two villages through sampling of 100 individual farming households based on random selection; questionnaires and checklist of questions were used as tools to access information from farmers through focus group discussions, personal interviews and key informants. In addition,Ciko Santrini project and foundation community project, which are the two agricultural community projects located within the study area were also investigated. Conceptual and analytical frameworks were employed in the research analysis. Williamson’s 4-level of social analysis and the sustainable livelihood frameworks were used to conceptualize the analysis. Inferential analysis was carried out using binary logistic regression and discriminant analysis with focus on butternuts and chicken production among the smallholder farmers in the study area to determine factors that could encourage farmers ‘access markets. The results showed that factors such as; assistance from government agency, partnerships with private and public institutions and farmers’ decision due to access to information were significant at 1% level for both butternuts and chicken production. On the other hand, factors such as provision of input subsidy and farmers’ membership of agricultural development projects are significant at 5% level. The findings suggest that adoption of any or combination of the significant factors could serve as good support structures for farmers and they could directly help them market their produce efficiently.
- Full Text:
- Authors: Arowolo, Steven Alaba
- Date: 2012
- Subjects: Agricultural assistance -- South Africa -- Eastern Cape , Agricultural productivity -- South Africa -- Eastern Cape , Agricultural extension work -- South Africa -- Eastern Cape , Agricultural development projects -- South Africa -- Eastern Cape , Rural development -- South Africa -- Eastern Cape , Farm produce -- South Africa -- Eastern Cape -- Marketing , Sustainable development -- South Africa -- Eastern Cape , Water resources development -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Masters , MSc Agric (Agricultural Economics)
- Identifier: vital:11181 , http://hdl.handle.net/10353/d1001027 , Agricultural assistance -- South Africa -- Eastern Cape , Agricultural productivity -- South Africa -- Eastern Cape , Agricultural extension work -- South Africa -- Eastern Cape , Agricultural development projects -- South Africa -- Eastern Cape , Rural development -- South Africa -- Eastern Cape , Farm produce -- South Africa -- Eastern Cape -- Marketing , Sustainable development -- South Africa -- Eastern Cape , Water resources development -- South Africa -- Eastern Cape
- Description: Smallholder agriculture is faced with so many challenges despite all the policies and programmes that have been channelled towards ensuring improvement in this sector. Improving smallholder agricultural productivity requires that smallholder farmers gain access to reliable and adequate farmer support services such as physical infrastructures like good road network, functional irrigation facilities, extension services, finance and efficient marketing system. However, these support services are lacking in a vast majority of the rural communities in which the smallholder farmers live and work. This study is centred on governance within the food value chains, with specific focus on butternuts and chicken value chains;with a view to identifying those factors preventing smallholder farmers from accessing the mainstream market. Ciko and Mbozi villages in Mbashe local municipality were used as the research sites for the study. Data were collected across the two villages through sampling of 100 individual farming households based on random selection; questionnaires and checklist of questions were used as tools to access information from farmers through focus group discussions, personal interviews and key informants. In addition,Ciko Santrini project and foundation community project, which are the two agricultural community projects located within the study area were also investigated. Conceptual and analytical frameworks were employed in the research analysis. Williamson’s 4-level of social analysis and the sustainable livelihood frameworks were used to conceptualize the analysis. Inferential analysis was carried out using binary logistic regression and discriminant analysis with focus on butternuts and cSmallholder agriculture is faced with so many challenges despite all the policies and programmes that have been channelled towards ensuring improvement in this sector. Improving smallholder agricultural productivity requires that smallholder farmers gain access to reliable and adequate farmer support services such as physical infrastructures like good road network, functional irrigation facilities, extension services, finance and efficient marketing system. However, these support services are lacking in a vast majority of the rural communities in which the smallholder farmers live and work. This study is centred on governance within the food value chains, with specific focus on butternuts and chicken value chains;with a view to identifying those factors preventing smallholder farmers from accessing the mainstream market. Ciko and Mbozi villages in Mbashe local municipality were used as the research sites for the study. Data were collected across the two villages through sampling of 100 individual farming households based on random selection; questionnaires and checklist of questions were used as tools to access information from farmers through focus group discussions, personal interviews and key informants. In addition,Ciko Santrini project and foundation community project, which are the two agricultural community projects located within the study area were also investigated. Conceptual and analytical frameworks were employed in the research analysis. Williamson’s 4-level of social analysis and the sustainable livelihood frameworks were used to conceptualize the analysis. Inferential analysis was carried out using binary logistic regression and discriminant analysis with focus on butternuts and chicken production among the smallholder farmers in the study area to determine factors that could encourage farmers ‘access markets. The results showed that factors such as; assistance from government agency, partnerships with private and public institutions and farmers’ decision due to access to information were significant at 1% level for both butternuts and chicken production. On the other hand, factors such as provision of input subsidy and farmers’ membership of agricultural development projects are significant at 5% level. The findings suggest that adoption of any or combination of the significant factors could serve as good support structures for farmers and they could directly help them market their produce efficiently.
- Full Text:
Risk preferences and consumption decisions in organic production: the case of Kwazulu-Natal and Eastern Cape provinces of South Africa
- Authors: Kisaka-Lwayo, Maggie
- Date: 2012
- Subjects: Food security -- South Africa , Sustainable development -- South Africa , Organic farming -- South Africa , Natural foods industry -- South Africa , Risk management -- South Africa , Consumers -- South Africa
- Language: English
- Type: Thesis , Doctoral , PhD (Agricultural Economics)
- Identifier: vital:11188 , http://hdl.handle.net/10353/492 , Food security -- South Africa , Sustainable development -- South Africa , Organic farming -- South Africa , Natural foods industry -- South Africa , Risk management -- South Africa , Consumers -- South Africa
- Description: Despite phenomenal success of the commercial agricultural sector in South Africa and significant progress in integrating smallholders since democratic reforms, food security concerns remain. Recent global increases in food prices have further exacerbated vulnerabilities and made it imperative to examine alternative food production questions in the country. Organic agriculture is identified as one of the sustainable approaches to farming and offers insights towards a paradigm shift in food and nutritional security. Notwithstanding, consumer awareness, knowledge and consumption of organic foods are significantly lower in developing than developed countries. Risks associated with adoption of organic practices need to be explored to address the supply and demand constraints. Similarly, while consumer awareness of organic foods is the first step in developing demand for organic products, it does not necessarily translate to consumption. Therefore it is important to investigate these issues. The objectives of this study were to: (i) describe the demographic and socio-economic characteristics of organic farmers and consumers; (ii) establish the determinants of farmers‘ decision to participate in organic farming distinguishing between the fully-certified organic, partially-certified organic and non-organic farmers; (iii) elicit farmers risk preferences and empirically analyse farmers sources of risk and risk management strategies; (iv) explore consumer awareness, perceptions and attitudes regarding organic products; and (v) identify the factors that influence consumer‘s preference and consumption of organic products. A total of 400 respondents were surveyed, consisting of 200 smallholder farmers in KwaZulu-Natal and 200 consumers in the Eastern Cape. The KwaZulu-Natal study was conducted earlier and identified the following as major sources of risk, lack of consumer awareness of organic products and lack of information among producers about consumer preferences for organic products. This informed the need to undertake a consumer awareness and preference study, in order to inform producers. The Eastern Cape is a bordering province to KwaZulu-Natal with similar socio economic conditions and a major consumer of produce from KwaZulu-Natal. It was also expected that in the intervening period there could have been awareness about the product. An vii indication of its appeal would not be in the consumption of the product by the people who grow it, but by consumers who reside in bordering regions. Producer and household questionnaires were used to record household activities, socio-economic and institutional data as well as household demographics through personal interviews. The Arrow Pratt Absolute Risk Aversion (APARA) coefficient was used to measure the farmer‘s degree of risk aversion and the experimental gambling approach to establish the risk classification. Consumers were also asked about their awareness and knowledge about organics, attitudes and perceptions towards organics, preference and consumption patterns. The ordered probit results indicate that older farmers, who are less risk averse and reside in the sub-ward Ogagwini, Ezigani, and Hwayi were more likely to be certified organic farmers. Similarly, the propensity to adopt organic farming is positively correlated to household size, livestock ownership, asset base and tenure security. The risk analysis indicates that at higher pay-offs most farmers are intermediate to moderately risk-averse, with little variation according to personal characteristics, and that non-organic farmers tend to be more risk averse than fully-certified and partially-certified farmers. In general, price, production and financial risks were perceived as the most important sources of risk. Using Principal Component Analysis (PCA), seven principal components (PCs) explaining 66.13% of the variation were extracted. Socio economic factors having a significant effect on the various sources of risk are age, gender, education, location, information access and risk taking ability. The most important traditional risk management strategies used by the surveyed farmers are crop diversification, precautionary savings and participating in social networks. There was general awareness of what constituted organic foods with many consumers associating organic foods with health and nutrition, chemical free and produced using indigenous methods of production. However, there was low awareness of organic products among consumers with little or no knowledge of organic certification and standards. According to the logit model the major factors influencing consumer awareness of organic products are: gender, education, employment status, and location of the respondents, person/household member responsible for shopping and the price perception of the decision maker. The discriminant analysis showed that the consumption of organic products is significantly affected by age of the consumer, viii location, person/household member responsible for shopping, consumer awareness of organics, price perception and label trust. The findings from this study provides useful practical insights for policy makers, farm advisers and researchers in the design of effective and efficient policies, programmes and projects which can affect the adoption of organic practices, increase smallholder farmers capacity to manage risk and drive growth in the organic food market.
- Full Text:
- Authors: Kisaka-Lwayo, Maggie
- Date: 2012
- Subjects: Food security -- South Africa , Sustainable development -- South Africa , Organic farming -- South Africa , Natural foods industry -- South Africa , Risk management -- South Africa , Consumers -- South Africa
- Language: English
- Type: Thesis , Doctoral , PhD (Agricultural Economics)
- Identifier: vital:11188 , http://hdl.handle.net/10353/492 , Food security -- South Africa , Sustainable development -- South Africa , Organic farming -- South Africa , Natural foods industry -- South Africa , Risk management -- South Africa , Consumers -- South Africa
- Description: Despite phenomenal success of the commercial agricultural sector in South Africa and significant progress in integrating smallholders since democratic reforms, food security concerns remain. Recent global increases in food prices have further exacerbated vulnerabilities and made it imperative to examine alternative food production questions in the country. Organic agriculture is identified as one of the sustainable approaches to farming and offers insights towards a paradigm shift in food and nutritional security. Notwithstanding, consumer awareness, knowledge and consumption of organic foods are significantly lower in developing than developed countries. Risks associated with adoption of organic practices need to be explored to address the supply and demand constraints. Similarly, while consumer awareness of organic foods is the first step in developing demand for organic products, it does not necessarily translate to consumption. Therefore it is important to investigate these issues. The objectives of this study were to: (i) describe the demographic and socio-economic characteristics of organic farmers and consumers; (ii) establish the determinants of farmers‘ decision to participate in organic farming distinguishing between the fully-certified organic, partially-certified organic and non-organic farmers; (iii) elicit farmers risk preferences and empirically analyse farmers sources of risk and risk management strategies; (iv) explore consumer awareness, perceptions and attitudes regarding organic products; and (v) identify the factors that influence consumer‘s preference and consumption of organic products. A total of 400 respondents were surveyed, consisting of 200 smallholder farmers in KwaZulu-Natal and 200 consumers in the Eastern Cape. The KwaZulu-Natal study was conducted earlier and identified the following as major sources of risk, lack of consumer awareness of organic products and lack of information among producers about consumer preferences for organic products. This informed the need to undertake a consumer awareness and preference study, in order to inform producers. The Eastern Cape is a bordering province to KwaZulu-Natal with similar socio economic conditions and a major consumer of produce from KwaZulu-Natal. It was also expected that in the intervening period there could have been awareness about the product. An vii indication of its appeal would not be in the consumption of the product by the people who grow it, but by consumers who reside in bordering regions. Producer and household questionnaires were used to record household activities, socio-economic and institutional data as well as household demographics through personal interviews. The Arrow Pratt Absolute Risk Aversion (APARA) coefficient was used to measure the farmer‘s degree of risk aversion and the experimental gambling approach to establish the risk classification. Consumers were also asked about their awareness and knowledge about organics, attitudes and perceptions towards organics, preference and consumption patterns. The ordered probit results indicate that older farmers, who are less risk averse and reside in the sub-ward Ogagwini, Ezigani, and Hwayi were more likely to be certified organic farmers. Similarly, the propensity to adopt organic farming is positively correlated to household size, livestock ownership, asset base and tenure security. The risk analysis indicates that at higher pay-offs most farmers are intermediate to moderately risk-averse, with little variation according to personal characteristics, and that non-organic farmers tend to be more risk averse than fully-certified and partially-certified farmers. In general, price, production and financial risks were perceived as the most important sources of risk. Using Principal Component Analysis (PCA), seven principal components (PCs) explaining 66.13% of the variation were extracted. Socio economic factors having a significant effect on the various sources of risk are age, gender, education, location, information access and risk taking ability. The most important traditional risk management strategies used by the surveyed farmers are crop diversification, precautionary savings and participating in social networks. There was general awareness of what constituted organic foods with many consumers associating organic foods with health and nutrition, chemical free and produced using indigenous methods of production. However, there was low awareness of organic products among consumers with little or no knowledge of organic certification and standards. According to the logit model the major factors influencing consumer awareness of organic products are: gender, education, employment status, and location of the respondents, person/household member responsible for shopping and the price perception of the decision maker. The discriminant analysis showed that the consumption of organic products is significantly affected by age of the consumer, viii location, person/household member responsible for shopping, consumer awareness of organics, price perception and label trust. The findings from this study provides useful practical insights for policy makers, farm advisers and researchers in the design of effective and efficient policies, programmes and projects which can affect the adoption of organic practices, increase smallholder farmers capacity to manage risk and drive growth in the organic food market.
- Full Text:
The competitiveness of the South African citrus industry in the face of the changing global health and environmental standards
- Authors: Ndou, Portia
- Date: 2012
- Subjects: Citrus fruit industry -- South Africa , Food industry and trade -- Safety regulations , Agricultural industries -- Safety regulations , Food -- Safety measures -- International cooperation , Export marketing -- Law and legislation -- South Africa , Competition, International
- Language: English
- Type: Thesis , Doctoral , PhD (Agricultural Economics)
- Identifier: vital:11162 , http://hdl.handle.net/10353/477 , Citrus fruit industry -- South Africa , Food industry and trade -- Safety regulations , Agricultural industries -- Safety regulations , Food -- Safety measures -- International cooperation , Export marketing -- Law and legislation -- South Africa , Competition, International
- Description: In recent years, concern about food safety linked to health issues has seen a rise in private food safety standards in addition to the regulations set by the Food and Agriculture Organisation (FAO) in collaboration with the World Health Organisation (WHO). These have presented challenges to producers and exporters of agricultural food products especially the producers of fresh fruits and vegetables. In spite of the food safety-linked challenges from the demand side, the vast range of business-environment forces pose equally formidable challenges that negatively impact on the exporting industries’ ability to maintain or improve their market shares and their ability to compete in world markets. The objective of this study was therefore to establish the competitiveness of the South African citrus industry in the international markets within this prevailing scenario. Due to the diversity of the definitions of competitiveness as a concept, this study formulated the following working definition: “the ability to create, deliver and maintain value and constant market share through strategic management of the industrial environment or competitiveness drivers”. This was based on the understanding that the international market shares of an industry are a function of forces in the business environment which range from intra-industry, external and national as well as the international elements. The unit of analysis were the citrus producers engaged in export of their products and the study made use of 151 responses by producers. The study adopted a five-step approach to the analysis of the performance of the South African citrus industry in the global markets, starting with the analysis of the Constant Market Share (CMS) of the South African citrus industry in various world markets, establishing the impact of the business environmental factors upon competitiveness, establishing the costs of compliance with private food safety standards, determining the non-price benefits of compliance with the standards, as well as highlighting the strategies for enhancing long-term competitiveness of the industry in the international markets. South Africa is one of the top three countries dominating the citrus fruit export market. Since its entry into the citrus fruit exports market in the 1900s, the industry has sustained its activity in the international market. The Constant Market Share Analysis shows that, amidst the challenges on the international market side, and the changes in the business environment, over much of which the industry has limited control and influence, the industry has maintained its competitive advantage in several markets. The CMS shows that South Africa’s lemons are competitive in America. Despite a negative trend, the South African grapefruit has been competitive in France, Greece, Italy, the Netherlands and Spain. Oranges have been competitive in the Greece, Italy, Portugal, UK, Asian and Northern Europe markets. Competitiveness in these markets has been due to the inherent competitiveness of the industry. Competitiveness in such markets as the Middle East has been attributed to the relatively rapid growth of these markets. The South African citrus industry has similarly undergone many major processes of transformation. The business environmental factors influencing its performance have ranged reform to the challenges beyond the country’s borders. These factors directly and indirectly affect the performance of the industry in the export market. They have influenced the flow of fruits into different international destinations. Of major concern are the food safety and private standards. Challenges in traditional markets as well as opportunities presented by demand from newly emerging citrus consuming nations have seen a diversification in the marketing of the South African citrus. The intensity of competition in the global market is reflected by the fluctuations in the market shares in different markets as well as the increase and fluctuations of fruit rejection rates in some lucrative markets such as America. A combination of challenging national environmental forces and stringent demand conditions negatively impact on revenues especially from markets characterised by price competitiveness. This study identified cost of production, foreign market support systems, adaptability, worker skills, challenges of management in an international environment and government policies such as labour and trade policies as some of the most influential obstacles to competitiveness. Some of the most competiveness-enhancing factors were market availability, market size, market information, market growth and the availability of research institutions. However, compliance with private standards still poses a challenge to the exporters. The different performance levels of the industry in various markets prove the dissimilarity of the demand conditions in the global market. These are supported by the negative influence associated with the foreign market support regimes as well as the challenges associated with compliance with private food safety standards. While market availability, market growth, market information and size were identified as enhancing competitiveness, the fluctuations and inconsistencies in the competitiveness of the industry in different foreign markets require more than finding markets. Resource allocation by both the government and the industry may need to take into account the off-setting of the national challenges and support of farmers faced with distorted and unfair international playing fields. Otherwise, market availability is not a challenge for the industry save meeting the specifications therewith as well as price competitiveness which is unattainable for the South African citrus producers faced with high production costs. For the purposes of further study, it is recommended that account should be taken of all the products marketed by the industry (including processed products such as fruit juices) in order to have a whole picture of the competitiveness of the industry in the international market. This study also proffers a new theoretical framework for the analysis of the business environment for the citrus industry and other agro-businesses. This framework takes into account the indispensability of the food safety standards and measures as well as the diversity of the global consumer and the non-negotiability of food trade for the sustenance of the growing population.
- Full Text:
- Authors: Ndou, Portia
- Date: 2012
- Subjects: Citrus fruit industry -- South Africa , Food industry and trade -- Safety regulations , Agricultural industries -- Safety regulations , Food -- Safety measures -- International cooperation , Export marketing -- Law and legislation -- South Africa , Competition, International
- Language: English
- Type: Thesis , Doctoral , PhD (Agricultural Economics)
- Identifier: vital:11162 , http://hdl.handle.net/10353/477 , Citrus fruit industry -- South Africa , Food industry and trade -- Safety regulations , Agricultural industries -- Safety regulations , Food -- Safety measures -- International cooperation , Export marketing -- Law and legislation -- South Africa , Competition, International
- Description: In recent years, concern about food safety linked to health issues has seen a rise in private food safety standards in addition to the regulations set by the Food and Agriculture Organisation (FAO) in collaboration with the World Health Organisation (WHO). These have presented challenges to producers and exporters of agricultural food products especially the producers of fresh fruits and vegetables. In spite of the food safety-linked challenges from the demand side, the vast range of business-environment forces pose equally formidable challenges that negatively impact on the exporting industries’ ability to maintain or improve their market shares and their ability to compete in world markets. The objective of this study was therefore to establish the competitiveness of the South African citrus industry in the international markets within this prevailing scenario. Due to the diversity of the definitions of competitiveness as a concept, this study formulated the following working definition: “the ability to create, deliver and maintain value and constant market share through strategic management of the industrial environment or competitiveness drivers”. This was based on the understanding that the international market shares of an industry are a function of forces in the business environment which range from intra-industry, external and national as well as the international elements. The unit of analysis were the citrus producers engaged in export of their products and the study made use of 151 responses by producers. The study adopted a five-step approach to the analysis of the performance of the South African citrus industry in the global markets, starting with the analysis of the Constant Market Share (CMS) of the South African citrus industry in various world markets, establishing the impact of the business environmental factors upon competitiveness, establishing the costs of compliance with private food safety standards, determining the non-price benefits of compliance with the standards, as well as highlighting the strategies for enhancing long-term competitiveness of the industry in the international markets. South Africa is one of the top three countries dominating the citrus fruit export market. Since its entry into the citrus fruit exports market in the 1900s, the industry has sustained its activity in the international market. The Constant Market Share Analysis shows that, amidst the challenges on the international market side, and the changes in the business environment, over much of which the industry has limited control and influence, the industry has maintained its competitive advantage in several markets. The CMS shows that South Africa’s lemons are competitive in America. Despite a negative trend, the South African grapefruit has been competitive in France, Greece, Italy, the Netherlands and Spain. Oranges have been competitive in the Greece, Italy, Portugal, UK, Asian and Northern Europe markets. Competitiveness in these markets has been due to the inherent competitiveness of the industry. Competitiveness in such markets as the Middle East has been attributed to the relatively rapid growth of these markets. The South African citrus industry has similarly undergone many major processes of transformation. The business environmental factors influencing its performance have ranged reform to the challenges beyond the country’s borders. These factors directly and indirectly affect the performance of the industry in the export market. They have influenced the flow of fruits into different international destinations. Of major concern are the food safety and private standards. Challenges in traditional markets as well as opportunities presented by demand from newly emerging citrus consuming nations have seen a diversification in the marketing of the South African citrus. The intensity of competition in the global market is reflected by the fluctuations in the market shares in different markets as well as the increase and fluctuations of fruit rejection rates in some lucrative markets such as America. A combination of challenging national environmental forces and stringent demand conditions negatively impact on revenues especially from markets characterised by price competitiveness. This study identified cost of production, foreign market support systems, adaptability, worker skills, challenges of management in an international environment and government policies such as labour and trade policies as some of the most influential obstacles to competitiveness. Some of the most competiveness-enhancing factors were market availability, market size, market information, market growth and the availability of research institutions. However, compliance with private standards still poses a challenge to the exporters. The different performance levels of the industry in various markets prove the dissimilarity of the demand conditions in the global market. These are supported by the negative influence associated with the foreign market support regimes as well as the challenges associated with compliance with private food safety standards. While market availability, market growth, market information and size were identified as enhancing competitiveness, the fluctuations and inconsistencies in the competitiveness of the industry in different foreign markets require more than finding markets. Resource allocation by both the government and the industry may need to take into account the off-setting of the national challenges and support of farmers faced with distorted and unfair international playing fields. Otherwise, market availability is not a challenge for the industry save meeting the specifications therewith as well as price competitiveness which is unattainable for the South African citrus producers faced with high production costs. For the purposes of further study, it is recommended that account should be taken of all the products marketed by the industry (including processed products such as fruit juices) in order to have a whole picture of the competitiveness of the industry in the international market. This study also proffers a new theoretical framework for the analysis of the business environment for the citrus industry and other agro-businesses. This framework takes into account the indispensability of the food safety standards and measures as well as the diversity of the global consumer and the non-negotiability of food trade for the sustenance of the growing population.
- Full Text:
The impact of the new co-operative act on employment and poverty reduction: a case study of sorghum producers in the Eastern Cape province
- Authors: Manciya, Sixolise
- Date: 2012
- Subjects: Sorghum industry -- South Africa -- Eastern Cape , Poor -- Employment -- South Africa -- Eastern Cape , Poverty -- South Africa -- Eastern Cape , Agriculture, Cooperative -- South Africa -- Eastern Cape , Cooperative societies -- South Africa -- Eastern Cape , Agricultural development projects -- South Africa -- Eastern Cape , Farmers -- South Africa -- Eastern Cape -- Economic conditions , Job creation -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Masters , MSc Agric (Agricultural Economics)
- Identifier: vital:11180 , http://hdl.handle.net/10353/d1001026 , Sorghum industry -- South Africa -- Eastern Cape , Poor -- Employment -- South Africa -- Eastern Cape , Poverty -- South Africa -- Eastern Cape , Agriculture, Cooperative -- South Africa -- Eastern Cape , Cooperative societies -- South Africa -- Eastern Cape , Agricultural development projects -- South Africa -- Eastern Cape , Farmers -- South Africa -- Eastern Cape -- Economic conditions , Job creation -- South Africa -- Eastern Cape
- Description: In general, traditional co-operatives suffer from free-rider, horizon, portfolio, control and influence problems that starve them of both equity and debt capital. Evidently, the factors which constrain agricultural development also inhibit co-operative development in the former homelands. These factors include socio-economic as well as political factors operating in the environment of the cooperatives. In addition to these external factors, co-operatives have several internal problems such as inefficient management and lack of understanding of the co-operative concept and principles. The New Cooperative Act No. 14 of 2005 was an attempt at addressing these fundamental problems. The purpose of this study was to analyze the extent towhich cooperatives organized on the basis of this new Act have performed and to ascertainwhether or not they have met the expectations of the policy makers. In order to address these issues a structured questionnaire was used to interview 100 farmers. Farmers were divided into two groups, one group consisting of fifty members and the other fifty non-members; all these farmers were randomly selected from Ndonga and Maqhashu in Lady frère. The study investigated and profiled the socio-economic situation of the communities of Ndonga and Maqhashu with particular emphasis on the employment and poverty situations, as well as the income earning opportunities in the communities. It also undertook a comparison of the members and non-members of the co-operatives in terms of their production results under the sorghum production programmes in the two communities.The data were analyzed by means of descriptive and inferential statistics which explain some measures of central tendency and dispersion as well as levels of significance. A t-test of independent samples was used to compare the means for the sorghum yields and revenues for non-members and members of the co-operative. Gross margin analysis was also used to determine the financial implications of cooperation for the smallholders. In addition, a multiple regression model and a discriminant function were fitted to determine the factors explaining the differences in performance of members and non-members of the cooperative society. The Gross Margin analysis shows that the cooperatives are operating at a loss, meaning they produce less with high production costs. However, the results also show that the Ndonga and Maqhashu sorghum co-operative did not benefit only its members but the whole community through significant job creation for the local population.
- Full Text:
- Authors: Manciya, Sixolise
- Date: 2012
- Subjects: Sorghum industry -- South Africa -- Eastern Cape , Poor -- Employment -- South Africa -- Eastern Cape , Poverty -- South Africa -- Eastern Cape , Agriculture, Cooperative -- South Africa -- Eastern Cape , Cooperative societies -- South Africa -- Eastern Cape , Agricultural development projects -- South Africa -- Eastern Cape , Farmers -- South Africa -- Eastern Cape -- Economic conditions , Job creation -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Masters , MSc Agric (Agricultural Economics)
- Identifier: vital:11180 , http://hdl.handle.net/10353/d1001026 , Sorghum industry -- South Africa -- Eastern Cape , Poor -- Employment -- South Africa -- Eastern Cape , Poverty -- South Africa -- Eastern Cape , Agriculture, Cooperative -- South Africa -- Eastern Cape , Cooperative societies -- South Africa -- Eastern Cape , Agricultural development projects -- South Africa -- Eastern Cape , Farmers -- South Africa -- Eastern Cape -- Economic conditions , Job creation -- South Africa -- Eastern Cape
- Description: In general, traditional co-operatives suffer from free-rider, horizon, portfolio, control and influence problems that starve them of both equity and debt capital. Evidently, the factors which constrain agricultural development also inhibit co-operative development in the former homelands. These factors include socio-economic as well as political factors operating in the environment of the cooperatives. In addition to these external factors, co-operatives have several internal problems such as inefficient management and lack of understanding of the co-operative concept and principles. The New Cooperative Act No. 14 of 2005 was an attempt at addressing these fundamental problems. The purpose of this study was to analyze the extent towhich cooperatives organized on the basis of this new Act have performed and to ascertainwhether or not they have met the expectations of the policy makers. In order to address these issues a structured questionnaire was used to interview 100 farmers. Farmers were divided into two groups, one group consisting of fifty members and the other fifty non-members; all these farmers were randomly selected from Ndonga and Maqhashu in Lady frère. The study investigated and profiled the socio-economic situation of the communities of Ndonga and Maqhashu with particular emphasis on the employment and poverty situations, as well as the income earning opportunities in the communities. It also undertook a comparison of the members and non-members of the co-operatives in terms of their production results under the sorghum production programmes in the two communities.The data were analyzed by means of descriptive and inferential statistics which explain some measures of central tendency and dispersion as well as levels of significance. A t-test of independent samples was used to compare the means for the sorghum yields and revenues for non-members and members of the co-operative. Gross margin analysis was also used to determine the financial implications of cooperation for the smallholders. In addition, a multiple regression model and a discriminant function were fitted to determine the factors explaining the differences in performance of members and non-members of the cooperative society. The Gross Margin analysis shows that the cooperatives are operating at a loss, meaning they produce less with high production costs. However, the results also show that the Ndonga and Maqhashu sorghum co-operative did not benefit only its members but the whole community through significant job creation for the local population.
- Full Text:
- «
- ‹
- 1
- ›
- »