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Eastern Cape Business 2023-24

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The 2023/24 edition of Eastern Cape Business is the 16th edition of this successful publication that, since its launch in 2006, has established itself as the premier business and investment guide for the Eastern Cape. The Eastern Cape Development Corporation (ECDC) is supporting this issue of the journal, both in providing up-to-date information for editorial use and in sharing information about its activities. It will also distribute the journal through its regular channels. The Eastern Cape’s multi-faceted approach to the challenges and opportunities of sustainability are explored in a special feature. From caring for agricultural land through partnerships between farmers, wool brokers and fashion houses, to solar panels and improved lighting and water systems, companies are finding ways to incorporate sensible and profitable solutions into their business models. The Nelson Mandela Bay Development Agency celebrates a significant milestone this year, it being 20 years since it began operations.

OVERVIEW Agriculture and

OVERVIEW Agriculture and agro-processing A black-owned dairy has won a major contract. SECTOR INSIGHT Magwa Tea Estate is functioning again. Danone has signed a R75-million agreement with Ncora Dairy in Keiskammahoek. The 600ha dairy is part of the Amadlelo Agri group, a majority black-owned producer of raw milk, and the investment will see 2 400 dairy cows producing 10.5-million litres of milk. The farm employs 35 people and 1 200 people are beneficiaries of the dairy’s operations. The first milking on the farm began in 2012 after the irrigation, parlour, roads and fencing were funded by the Eastern Cape Department of Rural Development and Agrarian Reform (DRDAR). The CEO of Amadlelo Agri, Simpiwe Somdyala, sees other benefits accruing from the investment: “I look forward to this partnership and the value that this will bring in upskilling us to be a zero-carbonemission-generating farm.” The Eastern Cape provides approximately a quarter of South Africa’s milk and the industry is further expanding as producers are favouring high-rainfall coastal areas such as the Tsitsikamma region. The rich natural grasslands of the Eastern Cape have the potential to produce high-value organic meat, a product that is increasingly popular in health-conscious international markets. There are about 70 000 people employed on commercial farms across the Eastern Cape, with a further 436 000 people dependent on smaller farms, mostly in the east. Deciduous fruits such as apples, pears and apricots are grown primarily in the Langkloof Valley. Another crop in which the Eastern Cape leads national production is chicory. The province’s pineapple crop is grown in the same part of the Sunshine Coast that produces chicory. The Eastern Cape holds 21% of the country’s cattle (about 3.2-million), 28% of its sheep (seven-million) and 46% of its goats, making it the largest livestock province by some margin. The Sundays River Valley is South Africa’s biggest citrus producer from a defined area. The valley’s harvest in 2021 was 30.5-million cartons and this is anticipated to increase to 40-million by 2026. The province as a whole is the country’s secondlargest cultivator of citrus. The Sundays River Valley irrigation scheme was started in 1920s. Darlington Dam (also known as Lake Mentz) was built on the river and a series of canals were constructed to supply water to farms from Kirkwood at the upper end of the valley to Addo. More than 4 000 people are employed in citrus in the Sundays River area, with that figure more than doubling in the picking and packing season. Further west, there is about 6 600ha of land under citrus in the Gamtoos Valley, which exports about nine-million cartons every year. More than 100 farmers are dependent on the Kouga Dam for EASTERN CAPE BUSINESS 2023/24 26

water in this region, but the dam has recorded consistently low levels in recent years and has to supply the towns of Hankey and Patensie and the Nelson Mandela Bay metro. Magwa Tea Estate is being restored and its products are appearing on shelves. The Premier of the Eastern Cape says he drinks no other tea. The provincial government has committed to buying Magwa and Majola tea, it can be bought at more than 100 retail outlets and the Premier Hotel Group is a purchaser. More than 1 500 jobs were saved when the provincial government intervened but other commercial partnerships, such as with timber company Sappi, will give Magwa a more diverse income stream. Agro-processing Getting small-scale farmers connected to agro-processing value chains is a major goal for agricultural policy-makers. This lies behind the creation of the Wild Coast Special Economic Zone (SEZ) near Mthatha. The 5 000ha Ncora Irrigation Scheme is seen as a model for the SEZ, which has attracted interest from AngloGold Ashanti and Exxaro. The DRDAR has several programmes to support small-scale farmers. The Eastern Cape Development Corporation (ECDC) supports agro-processing through loans and equity arrangements: projects that have received financial support include aquaculture, the production of dietary fibre from pineapples and bamboo products. The National Woolgrowers’ Association of SA (NWGA), with a membership base of 4 500 commercial and 20 000 communal members, is based in Gqeberha, as is Cape Wool SA. South Africa produces about 54% of the world’s mohair and Gqeberha is the mohair capital of the world. Farms around the small towns that dot the open plains south of Graaff-Reinet, Aberdeen, Somerset East, Jansenville and Willowmore routinely produce nearly half of South Africa’s production. The office of the South African Mohair Growers Association (SAMGA) is in Jansenville. Grootfontein College of Agriculture, the only tertiary educational institute in the country to offer a programme aimed at Angora goat farming and mohair production, is in Middelburg. Processing of mohair takes place in Kariega, Gqeberha and Ntabozuko (Berlin) outside East London. The mohair value chain includes brokers,buyers, processors, spinners, manufacturers and retailers. Simpiwe Somdyala, CEO of Amadlelo Agri The SAMIL company has divisions all along the value chain. The Stucken group controls Mohair Spinners South Africa, Hinterveld (a mill) and the processing company Gubb & Inggs in Kariega. Ouma Rusks are still made in Molteno where they were invented. Cadbury Chocolates operates a big site across the lake from the Nelson Mandela Stadium in Gqeberha and Nestlé makes 11 kinds of chocolate at its factory in East London. The Sasko mill in Gqeberha is the province’s only big milling plant. Coca-Cola Sabco and SAB’s Ibhayi brewery are the major beverage manufacturers in Gqeberha and Distell has a bottling plant in the city. Sovereign Foods in Kariega is the country’s fourth-biggest producer of poultry. ■ ONLINE RESOURCES Citrus Growers’ Association of Southern Africa: Eastern Cape Rural Development Agency (ECRDA): Milk Producers Organisation: South African Mohair Growers Association (SAMGA): 27 EASTERN CAPE BUSINESS 2023/24

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