Agri Value Chain Virtual Discussion Series – Milling industry

Anchored by Agbiz CEO Dr John Purchase, the panel for this discussion includes De Wet Boshoff, Executive Director, AFMA; Boikanyo Mokgatle, Executive Director, National Chamber of Milling; and Peter Lovelace, CEO, Central Edible Oil Company (Ceoco).

The session started with De Wet Boshoff speaking from the perspective of being the link between the grain sector, animal feed and the animal sector as a whole. He describes the manufacturer’s industry as being an interesting position in the agri value chain and talks about unlocking sustainable growth in all sectors of the agricultural value chain. “You can picture us as a Switzerland, we are neutral. We project ourselves in the value chain as a supporting industry, helping other industries in the value chain achieve their growth goals,” he says.

Boikanyo Mokgatle enlightens viewers on how the milling industry adds value to the value chain. “It is imperative for us to consult with the government from an industry perspective.” He sheds light on the work of the various established forums and the process of collaboration as industry stakeholders move towards a value chain way of thinking as opposed to industries moving in isolation. He stresses the need for government to create an enabling environment from a trade policy perspective to create opportunities for the industry to take advantage of growth opportunities in the global space. Boikanyo says that it is time to move to the next step of engaging industry structures further.

Peter Lovelace explains the mechanics of the oil industry and what he describes as its ‘relatively fluid’ value chain. He expresses his concern at sunflower seemingly getting pushed out of the chain due to various factors, not least of which is the climatic conditions that have led to a scarcity of rain. “The quality of the sunflower we are growing keeps deteriorating and that is a concern. If we are getting lower and lower oil content in the seed grown, that will affect our competitiveness and our cost structure.” He mentions that South Africa does have the capacity to replace our internationally imported sunflower oil with locally produced and crushed oil. If we can get the producers to produce more locally and climatic conditions improve our imports can easily grow exponentially.

Speaking on the export possibilities available for animal feed products for the South African value chain, De Wet expressed concerns about the infrastructure constraints that cause the price of transportation of goods within our borders to be much more expensive than international shipping, especially in coastal regions. Boikanyo adds to the discussion by saying that we are in a transitional figure and that stockpiling and high demand due to the Covid-19 pandemic has contributed to increased reportedmaize shortages.

In his closing statement, Peter raised great concern about the continuing decay of our municipalities and factories but rounded his statement off on a positive note touching on the hard work that the industry has put in to up the quality of local soybean production and how he believes we can challenge the quality of imports without any doubt. He also sent kudos to South African farmers who he says are “some of the best in the industry”.

The fourth session of the Agricultural Value Chain Virtual Discussion Series will put the focus on producers. We will be looking at different company’s views on the agricultural food value chain approach to the local market,company's agricultural food value chain approach concerning access to the international market and the economic impact that Covid-19 has on the industry.

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