Minister Meets With Banks About Drought

Statement by the Minister of Agriculture, Cobus Dowry

6 December 2004

During a meeting with all the major banks, organized agriculture co-ops, and officials from the Department of Agriculture, at my request, it was re-emphasized that a joint effort by all role players will be needed to make a meaningful impact on the effect of the drought in the Western Cape.

Poor yields, ranging from less than one ton per hectare, to 25000 hectares that produced no yield at all, are putting the future existence of wheat farmers under threat. Poor yields in crops can only be atttributed to the extreme weather conditions. In my deliberations with banks and co-ops it is evident that the farmers cannot be blamed for the poor and well below average yields.

The total effect of this means that farmers will not be in a position to obtain any future finance towards production cost for the 2005 season resulting in many farmers not being able to put one grain of wheat into the ground at the start of the next season.

The impact of this on the total rural community, from producers, to farm labourers, to entire towns, means that we will have ghost towns with many thousands of farm labourers and other employers in businesses that will be laid off. The estimated direct impact on farm workers will be the loss of more than one third of the estimated 3000 jobs with wheat farmers in this area. For this reason I have called on banks and co-ops to reschedule and consolidate the debt of farmers.

My advisory committee on the assessment and prioritization of drought-stricken areas in the Province has completed a tour of the Province and we will be in a position to disburse funds from the R9 million that was allocated to us by the National Department of Agriculture, as soon as the allocation and formula for disbursement has been gazetted.

In the meantime, the banks and co-ops have indicated their willingness to form a joint task team with the Western Cape Department of Agriculture to look at various models through which farmers could find some form of relief in the present situation. Both groupings stressed their commitment to work with us to find a way forward to assist our farmers during these hard times and welcomed the initiative that we are taking to create this channel of communication in the interest of the farmers and agriculture as a whole.

ENQUIRIES: ALIE VAN JAARSVELD
084 604 6701