PRESENTATION TO THE PORTFOLIO
COMMITTEE ON AGRICULTURE, FORESTRY AND
FISHERIES
The impact of the current drought on agricultural
productivity, sector employment and food costs;
and the Department’s response in assisting
farmers in drought-stricken areas
24 NOVEMBER 2015
THE DISASTER RISK MANAGEMENT CYCLE: AN IMPERATIVE
FOR DROUGHT AND FIRE RISK MANAGEMENT
Response
Prevention
Recovery
Development
2
CONTENTS OF THE PRESENTATION
o PURPOSE
o BACKGROUND
o IMPACT ON ANIMAL PRODUCTION FARMERS
o IMPACT ON CROP PRODUCTION FARMERS
o PROGRESS ON RESPONSE MEASURES
o CONCLUSION
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PURPOSE OF THE PRESENTATION
o To report on the impact of drought to the sector
o To reflect on weather outlook to inform planning for drought and fire
risk reduction
o To highlight specific impacts on selected commodities and trade
o To highlight progress made to date in responding to the situation
o To highlight implications on food security
o To recommend measures moving forward
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OVERVIEW OF THE AGRICULTURAL SECTOR
o Agriculture, Forestry and Fisheries sector is vital to many livelihoods.
o It is a source of employment for rural communities with significant
contribution to the Gross Domestic Product (GDP).
o Drought has crucial influence towards the sector in addressing socio
economic challenges of the country.
o Stats SA notes that the sector contracted by 17% quarter on quarter largely
due to drought conditions in 2015.
o The CSIR forecast that significant rainfall is only expected by March 2016.
o There is a need to foster agricultural development and food security
measures despite the effects of drought and fire incidents.
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FOOD SECURITY STATUS: A REGIONAL AND
GLOBAL PICTURE
 Regionally:
o Hunger in the region declined by 30% between the 1990- 1992 and 2015, this is in
accordance with the State of Food Insecurity in the World Report (SOFI 2015).
o This 30% decline translates to approximately one person out of four in SSA is
undernourished today compared to a ratio of one person out of three in 1990-1992.
 Nationally:
o About 14.1 million (26%) of people in South Africa are still predisposed to hunger and
malnutrition and therefore do not have enough food to eat, thereby increasing levels of
absolute poverty every year.
o The figure steadily increased from 12.0 million in 2011, 13.6 million in 2012, and 13.8
million in 2013.
o The upward trend calls for action to counter the situation, e.g. Agricultural Policy Action
Plan (APAP) etc.
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GLOBAL OUTLOOK – SHOULD SA IMPORT
o Based on the latest indications, the world cereal supply and demand
balance in the 2015/16 marketing season is likely to remain in a generally
comfortable situation.
o While world production is expected to fall below last year’s record, supplies will
be almost sufficient to meet the projected demand, requiring only a small
reduction in global stocks by the end of the season (FAO, 2015). FAO, 2015.
o World cereal production in 2015 is currently forecast at 2 534 million tons,
6 million tons less than expected in September and 24 million tons (0.9%)
below the 2014 record.
o This month’s revision results from lower production prospects for coarse
grains and rice, which more than offset a higher estimate for wheat. The
forecast for global coarse grains production in 2015 has been lowered by
around 5 million tons in recent weeks on less buoyant expectations in the
United States and the EU, more than offsetting improved prospects in
Brazil.
o The latest forecast puts this year’s global coarse grains production at 1
306 million tons, 1.8% below the record of 2014.
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GLOBAL OUTLOOK – SHOULD SA IMPORT
o The forecast for rice production has also been cut by close to 8 million tons, to 493 million
tons (in milled terms), reflecting the numerous setbacks endured since the onset of the
season and the diminishing scope for recovering losses through larger secondary crops
as the season advances.
o At this level, global rice production would be 1.9 million tons, or 0.4%, lower than the
current estimate for 2014, implying a second year of mute or negative growth.
o
By contrast, world wheat production is now forecast at around 735 million tons, 6.4
million tons above the previous forecast in September and slightly (0.3%) exceeding last
year’s record. Higher wheat production in China and the European Union (EU) accounts
for most of this month’s upward adjustment.
o World cereal utilization in 2015/16 is expected to approach 2 530 million tons, down 6
million tons from the previous forecast, but still 1.2% (31 million tons) above 2014/15. This
month’s revision mostly reflects downward adjustments to world food consumption
estimates for rice.
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GLOBAL OUTLOOK – SHOULD SA IMPORT
o Total food consumption of cereals is currently put at 1 097 million tons,
down 21 million tons from the previous forecast, but still 1.1% higher
than the revised estimate for 2014/15.
o Total feed utilization of cereals is projected at 904 million tons, 6.4
million tons higher than last reported and 1.8% above 2014/15. Higher
anticipated feed use in China, Canada and the EU accounts for most of
the revision.
o Total industrial use of cereals (for the production of ethanol, starch and
brewing) is projected to increase marginally from 2014/15 as demand
by the grain-based fuel ethanol industry is predicted to remain almost
flat, mostly reflecting a sluggish growth in the maize intake in the United
States.
o By contrast, a strong demand for starch is anticipated to boost the use
of grains for starch production, with most of the increase concentrated
in China.
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GLOBAL OUTLOOK – SHOULD SA IMPORT
o Rice trade in 2016 (January/December) is now forecast
at near 45 million tons, 1 million tons, or 2.2%, more than
last year and almost 3 million tons above the precedent
forecast in September.
o Besides reassessing trade availabilities and requirements
in light of more pessimistic 2015 crop prospects, the new
figures take unrecorded trade flows into better
consideration.
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RAINFALL DISTRIBUTION: A COMPARATIVE
PICTURE
Less rainfall during 2014-2015 especially in most parts of the country with arable land
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PROVINCIAL DAM LEVELS
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THE IMPACT OF DROUGHT ON FOOD
PRODUCTION
o
The grain industry is one of the biggest - contributing about 25% of
agricultural GDP
o
Maize is the largest locally produced field crop and an important source of
carbohydrates in the Southern Africa region
o
South Africa is the largest maize producer in the Southern African
Development Community (SADC) region
o
There are more than 9000 commercial scale as well as thousands small
scale producers
o
Maize is mainly produced in North West, Mpumalanga highveld, Free
State (FS), KwaZulu-Natal (KZN) midlands
o
o
About 8 million tones of maize is consumed in SA and the rest exported
KZN, Mpumalanga (MP), North West (NW), Limpopo (LP), and Free State
(FS) are severely affected with some areas declared disaster-stricken. In
iLembe District Municipality in KZN, municipalities are tankering drinking
water to communities and there is already water restrictions imposed in
many areas to mitigate against the drought impact
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DROUGHT IMPACT ON ARABLE LAND IN SA
NB:
- The drought has affected arable land in SA.
- Area planted for white & yellow maize
maize is reduced.
- South Africa has declining but sufficient
stock levels of white maize until the end of
April 2016, yellow maize stocks will be very
tight.
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IMPACT OF DROUGHT TO FOOD SECURITY:
GRAIN
o The 2014/2015 drought affected SA’s grain production areas,
therefore affecting availability of white maize which is a major staple
as well as yellow maize which is critical for feed
o July 2014 to July 2015, the cost of basic food basket increased by
about R21 (+4.1 %) in nominal terms from R502 to R522 (National
Agricultural Marketing Council (NAMC), 2015)
o In terms of food security, this drought also has impact in the SADC
o The maize production estimate for 2014 was at 9.84 million tonnes ,
31% less than 14.250 million tons for 2013 production season (Crop
Estimate Committee, 2015)
o This translates to an average maize yield of 5.30 t/ha, the lowest
maize yield since 2008
o This will affect the price of maize meal and the affordability of basic
staple food especially by the poor and vulnerable.
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IMPACT OF DROUGHT IN THE REGION
o The early maize production forecast stands at about
21 million tons, which is at 15% lower than the fiveyear average and significantly below last year’s
bumper crop.
o The lack of rainfall during the critical time for growing
maize in the Mozambique , southern part of
Zimbabwe and Eastern part of South Africa, Namibia,
Botswana and Southern part of Angola.
o It is expected that large volumes will be imported by
Zimbabwe, as well as Botswana, Lesotho, Namibia
and Swaziland.
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MAIZE PRICES ON THE SAFEX MARKER
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MARKET PROFILE ON SOYABEANS
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PROJECTIONS ON MAIZE STOCKS
o The projected closing stock level of total maize at 30 April 2016 is
estimated at 1,323 million tons, compared to 2,074 million tons the
previous season.
o White maize is estimated at 1,039 million tons against 1,283 million
tons the previous season, whilst yellow maize is estimated at
283 884 tons against 791 054 tons the previous season.
o For the end of April 2016, the available stock for total maize is 48
days against 76 days the previous season.
o For white maize, South Africa has sufficient stock levels up until the
end of April 2016, however, the stock levels for yellow maize will be
tight.
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IMPACT ON MAIZE AND WHEAT PRICES
o The respective future prices for wheat, maize (white and yellow) and
sunflower for delivery in October 2015 experienced upward
pressure, compared to the same period last year (2014).
o On 30 September 2015, the mark-to-market price (SAFEX) for white
maize to be delivered in October 2015 amounted to R3 159/tons
compared to R1 761/tons (up by 79% or R1 398/ton) the same time
the previous year.
o For yellow maize, the price amounted to R2 924/tons compared to
R1 770/tons (up by 65% or R1 154/ton) the same time the previous
year.
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IMPACT ON LIVESTOCK FARMERS
o High economic losses especially on Game and high value livestock
stud breeds
o Poor fertility of National herds due to poor nutrition of animals under
extensive conditions
o Poor calving rates and high mortality rate
o Poor nutritional of animal proteins for human consumption
o There is a need to manage epidemiological effects of the drought,
viz: outbreak of diseases due to pollution of streams, etc.
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INTERVENTIONS TO DATE
Implementation of risk reduction measures in line with the disaster risk management
sector plan aligned to the Disaster Management Act 2002 (Act 57 of 2002) that includes
o Implement the landcare program (R66 million) to reduce veld and soil degradation
and water loss and promote conservation agriculture practices.
o Through the ARC released the drought tolerant maize.
o
Prevention and mitigation programmes, spent R9 million on drilling boreholes for
livestock water.
o Disseminate early warning information and provide appropriate advice to farmers in
the form of strategies.
o
DAFF must make the awareness to the farmers to irrigate in the early hours
and late.
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INTERVENTIONS TO DATE
RISK REDUCTION
Such strategies include:
• Usage of grey water especially in food gardens.
• Water harvesting technique
• Times for irrigation i.e late afternoon/early evening to reduce
evaporations
• Using drip irrigation instead of sprinklers as it saves water
• Reducing livestock to protect limited grazing
o Partnership: through the NAMC conduct Food Price monitoring.
o Developed and implement climate adaptation plan and program for the
sector
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DECLARATIONS
o Almost all province are affected by drought disaster such as Free
State;Mpumalanga;North West;KwaZulu Natal;Northern Cape;
Limpopo; Western Cape and Gauteng.
o Amongst the above eight (8) Provinces mentioned only four (4)
confirmed declarations of state of provincial disaster as per disaster
Management Act (57 of 2002).
o Other provinces are in a process of declaring.
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Response and relief measures
o Provision of R36.5 million by Provincial Departments of Agriculture
to relieve small scale and subsistence farmers in affected provinces.
o DAFF provides R226 million through reprioritization of the conditional
grant to provide the livestock feed and water to smallholder farmers to
both maintain production animals and encourage the herd reduction
through the market
o Department of Agriculture forestry and Fisheries has requested
provinces to reprioritised 20% of CASP/ILIMA Letsema conditional
grant.
o The funding from Comprehensive Agricultural Support programme
(CASP) and illema letsema programmes to assist the small scale
farmers. CASP will be for Agricultural infrastructure projects and ILIMA
fund will be for animal feeds;Inputs and Transportation inclusive.
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Response and relief measures
o DAFF has provided the Provincial departments with the template to register
farmers affected by drought and therefore the assistance will depend
on the list provided and also the list will be used for delivering points.
o DAFF has developed disaster relief scheme framework for
implementation that include conditions for relief programme.
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INTERVENTIONS TO DATE
o Industrial Development Cooperation have made available the soft loans
through its Agro Processing and Agriculture Strategic Business unit for
Commercial Sector as a result funding will be commercial in nature and
not grants.
o The emergency funding will be allocated towards working capital,
infrastructure and a small portion allocated towards carry over debt.
o IDC will consider financial assistance to its existing clients that apply for
drought relief.
o For non-IDC clients, lending will not be made directly to the endbeneficiary but rather through intermediaries that are NCA compliant.
(e.g. Landbank, Agribusinesses).
o The loan agreement will thus be entered into between IDC and the
relevant intermediary. These intermediaries will have to apply to IDC on
a case by case basis and a due diligence will be applicable.
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INTERVENTION TO DATE
oCoordinate and mobilize relevant departments food supply to
distressed families in the affected areas including farm workers.
oThrough Ilima letjema support recovery with seeds and inputs for
recovery.
oThrough existing drought Task Team to monitor and coordinate the
response measures appropriately.
oThrough NAMC, the Crop Estimates Committee to monitor the
demand and supply of the grains and the food prices.
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COLLECTIVE INTERVENTIONS TO DATE
o Relevant Ministers are meeting regularly to oversee the situation
and give direction on the necessary interventions.
o Relevant Ministers have been established under the leadership of
COGTA with last media briefing dated 13 November 2015 (DAFF;
DEA; DWS and COGTA).
• The coordination is at NDMC under DCoG for all departments, they
have established Joint Operational Centre (JOC)
• DAFF has established the Joint Sector Operation Committee, all
relevant line functions participate
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COLLECTIVE INTERVENTIONS TO DATE
o The PDMC coordinate departments at provincial level including
organised agriculture including relevant stakeholders (i.e NDMC
JOC).
o Inter-Departmental Structure is being formalised.
o The engagement with the Commodity organisations and farmer
organisations is taking place.
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PROVINCIAL DEPARTMENTS REPRIORITISED FUNDS
DROUGHT UTILISED FUNDS BY PROVINCES TO DATE
Province
Provincial
Contribution
Number of Farmers
assisted
Areas Benefitted
(Municipalities)
Funds used for
FS
R10 million
456
Machabeng
Livestock
Feed(Transport
included)
KZN
LP
R24 million
R3 million
541
Thulamela, Blouberg
Musina, Lephalale
Letaba, Polokwane
Makhuduthamaga,
Elias Motswaledi
Livestock
Feed(Transport
included)
MP
R1.8 million
220
Thembisile Hani
Nkomazi
Firefighting
Equipment’s
NC
R 7.6 million
256
Namakwa
Louriesfontein
Calvinia
Brandvlei
Livestock
Feed(Transport
included)
GP
R 1 million
250
City of Tshwane
West rand
Sedibeng
Ekurhuleni
Livestock
Feed(Transport
included)
Total
R47.4 million
1 723
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DAFF REPRIORITISED FUNDS
The reprioritisation of the Conditional Grants is been considered to make
provision for support on Animal feed, Animal Water Supply in line with the
conditions of the Grants
Province
Total reprioritised R’000
Confirmed funds reprioritised
R’000
Eastern Cape
29 476
0
Free State
30 663
29 000
Gauteng
15 186
3 000
KwaZulu-Natal
22 489
45 000
Limpopo
28 391
51 000
Mpumalanga
25 610
0.00
Northern Cape
24 748
0.00
North West
37 982
33 922
Western Cape
12 390
0.00
Total
226 935
161 922
Funds will disbursed through the provincial departments in the line drought
disaster management framework.
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DAFF REPRIORITISED FUNDS
Emergency Funding requests for drought have been received from affected province
and requests are as follows.
PROVINC
E
FODDERS
REQUEST
LIVESTOCK
WATER
RESOURCE
PROVINCIAL
CONTRIBUTI
ON
NUMBER OF FARMERS
AFFECTED
NUMBER OF
LIVESTOCK
AFFECTED
FS
R 77,89
million
R 24,662
million
R10
2 907 (748 commercial)
109 245
KZN
R 142 million
R800 million
R 24 million
153 000 (16000
commercial)
2,7million
LP
R 20 million
R31 million
R3 million
67 445(only communal)
51 560
MP
R50 million
R21 million
R 1,8 million
1 804 (396 Commercial)
114 400
NW
R 2,9 billion
R 179,425
million
-
19 430 (1 767 commercial)
481 187
NC
-
-
R7,6 million
-
-
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CONCLUSION AND WAY FORWARD
o It is critical that we put more effort in improving understanding of the
risks and vulnerabilities of the agricultural, forestry & fisheries sector
and the impacts of these vulnerabilities on rural communities.
o There is need to reconsider existing programmes funding to ensure
limited adverse effect on crop failures while strengthen legislative
frameworks such as Conservation of Agricultural Resources Act, Act
43 of 1983 (CARA) to encourage correct livestock unit per hectare.
o DAFF will continue to provide farmers with weather advisories and
warnings to guide future crop plantation and reduction of stock.
34
CONCLUSION AND WAY FORWARD
o All fundamental signs point to an upward trend in food prices.
o South Africa has national food security but not household food security.
o Ongoing disaster risk reduction measures and climate change adaptation measures
in the agricultural, forestry and fisheries sectors need to be scaled up
o Land rehabilitation programmes need to be scaled up to improve land productivity for
agricultural production (e.g. LandCare Programme)
o Heightened support for departmental programmes such as FETSA TLALA,
Comprehensive Agricultural Support Programme (CASP), Ilema,etc.
35
CONCLUSION AND WAY FORWARD
o It is critical that we put more effort in improving understanding of the
risks and vulnerabilities of the agricultural, forestry & fisheries sector
and the impacts of these vulnerabilities on rural communities.
o There is need to reconsider existing programmes funding to ensure
limited adverse effect on crop failures while strengthen legislative
frameworks such as Conservation of Agricultural Resources Act, Act
43 of 1983 (CARA) to encourage correct livestock unit per hectare.
o DAFF will continue to provide farmers with weather advisories and
warnings to guide future crop plantation and reduction of stock.
appropriate.
36
RECOMMENDATIONS
That the Portfolio Committee on Agriculture, Forestry and
Fisheries notes :
• The profile of the drought situation nationally;
• the interventions being instituted to respond to and
recover from the drought situation;
• consider strengthening provincial capacities for
agricultural disaster risk management coordination to
ensure risk reduction and effective response; and
• provide guidance on possible interventions to enhance
current response efforts.
37
Thank you
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