Lessons from Rooibos

2010-06-15 00:00

ROOIBOS is as uniquely South African as Champagne is French and Parmesan Italian. It should be one of our roaring success stories, while providing a platform for the upliftment of its traditional owners, the indigenous people who introduced it to the colonialists from its home range of the Cederberg Mountains. But while the Rooibos market has grown over the years, the indigenous emerging farmers remain largely marginalised and have yet to reap their just rewards.

Under apartheid, a Rooibos tea board was created to nurture the market and protect the novel product, both nationally and internationally. This created a strong foundation to assist the nascent industry, while excluding its traditional users, who had been responsible for revealing its secrets to the world.

Today, we have well-established overseas markets with wealthy nations such as Germany, Netherlands and Japan among our biggest customers. We export more than 60% of the crop, yet the price paid to farmers has sharply declined over the past five years, dropping by over 200% from its peak in 2004. There has been a failure to optimise a potentially lucrative export market which has exhibited instability over the past seven years. Rooibos traders and retailers receive far higher returns on their investments than the farmers.

Despite these challenges, some emerging indigenous farmers made remarkable headway in establishing niche markets through the support of nongovernment organisations, funded mainly by northern donors during the post-democracy heyday.

Small co-operatives such as the Heiveld Co-op, based around Nieuwoudtville in the Northern Cape and Wupperthal in the Western Cape, made bold strides to establish themselves as superior-quality organic and Fairtrade producers, partnering with international Fairtrade organisations.

Fairtrade was created to benefit producers in developing nations and assist the replacement of exploitative plantation trading systems with a socially, economically and environmentally sustainable system. It aims to pay a fair price to producers, reflecting the true value of the product.

Over the past few years, several established plantation farmers have gained inclusion into the Fairtrade system through questionable assessment criteria. This has tended to undercut indigenous farmers, while also undermining the intent of Fairtrade, which was never intended for use by plantation farms.

This already delicate situation has been significantly worsened by political interference.

The members of the Heiveld Co-op all farm in the Northern Cape in the region of the village of Nieuwoudtville.

In 2007, the Northern Cape government impetuously interfered in the Rooibos tea industry, without proper due process, research or consultation with local farmers. Well over R100 million was injected into building packing sheds, drying courts and other infrastructure in the Nieuwoudtville area.

While intentions were doubtlessly good, the result was the remarginalisation of the indigenous emerging farming community, who despite raising questions — and being told to shut up — were tempted to comply through promises of free diesel, vehicles and Rooibos seedlings. As these seedlings were not organic, several farmers lost organic certification of tea lands which had been gained at significant expense, and will take three years to regain.

The primary beneficiaries of this massive cash injection were the conventional, primarily white, Rooibos farming community. There was also significant market disruption through farmers being offered prices above the open-market value, resulting in a massive stockpile which now serves to depress further already low market prices. The emerging farmers remain marginalised.

What is even stranger is that this whole scheme was initiated by a partnership between the Limpopo and Northern Cape Departments of Agriculture. How did this happen?

It appears that the then head of the Limpopo Department of Agriculture, Bigman Maloa, was instrumental in pushing this scheme to supplement his attempts to save the failed conventional tea estates in Limpopo province, which were abandoned by overseas investors.

In association with his political colleague, Tina Joemat-Pettersson, then head of the Northern Cape Department of Agriculture and now national Minister of Agriculture, Forestry and Fisheries, Maloa sought Rooibos tea to market through a new quasi-governmental tea company, Venteco (Pty) Ltd, with questionable marketing proposals that have yet to bear fruit. This entity was bailed out, yet again, in May 2010, by the Limpopo provincial government.

At the end of 2009, Maloa was suspended by the Parliamentary Standing Committee on Public Accounts (Scopa) because of alleged misappropriation of over R45 million from his department, pending a forensic audit and investigation that is reportedly not yet complete.

Despite this, Maloa was appointed deputy director general of the national Department of Agriculture, Forestry and Fisheries, being put in charge of food safety and biosecurity by his erstwhile partner on this Rooibos project, Joemat-Pettersson.

Heiveld Co-op tea was rapidly becoming established as one of the highest quality Rooibos teas on the market, with its product still being marketed under the Pick n Pay organic house brand. Yet, instead of government assistance, its farmers and their organisation were undermined and many are now trapped in an awkward situation, dependent on powerful industry players. Do we need a clearer example that politics and agriculture do not mix?

Fortunately, Heiveld has managed to re-establish its independent management systems and marketing, largely recovering from the setbacks. Members learnt both the value of their independence and how inappropriate investment by the government can undermine local initiative.

What has happened in this case is a microcosm of what has befallen our agricultural markets. Political interference, whether building or dismantling systems, has inevitable unintended consequences.

Neo-liberal and free market influences imposed on South Africa’s agricultural system since our democratic transition have undermined true transformation of the sector by throwing our farmers to the wolves of international trade. Just how do we manage to sustain, uplift and transform our agricultural system against these complex challenges?

Our agricultural sector has a long history of political meddling. The apartheid state supported the Afrikaner farming community through protective instruments such as agricultural marketing boards.

These boards were dismantled under our new dispensation because of internal economic and political pressure, as well as through external neo-liberal influences such as the World Trade Organisation (WTO). This exposed the sector to disruptive influences such as subsidised and dumped commodities from the developed world. These problems were compounded by the facilitated entry of multinational corporations that now control our seed and commodity crop trading services, undermining national sovereignty and food security.

While we dismantled agricultural protection, other nations recognised the threats and took steps to protect their agricultural systems. In 1997, the Russian Agriculture Minister stated that he would maintain agricultural protection as a matter of national security. The WTO Doha round remains stalled, primarily because of developing nations’ unhappiness with the unequal trading systems proposed by developed nations.

Our small and emerging farmers remain marginalised. In the Western Cape, protests are becoming increasingly vociferous against ongoing displacement and lack of state support. The political failure to protect emerging farmers from the vagaries of the neo-liberal market system continues to undermine new entrants.

South Africa has lost markets throughout the region through our blind adoption of genetically modified crops. The trans-national corporate control of our grain markets has made it artificially cheaper to import feed into the Western Cape from Argentina and the United States than to shift our surplus from silos inland.

Instead of singing the praises of ad-hoc, nonconsultative schemes at World Economic Forum gabfests while ignoring the malign side-effects, we need political leadership that is informed and that works toward supporting national interests. We cannot continue to rely on career politicians who fail to comprehend the fundamental realities of globalised agricultural markets.

Mistakes made at national level are being repeated and compounded provincially. Pseudo-nationalisation and the appointment of politically connected cadres tend to trigger costly mistakes rather than attain success.

The case of the Heiveld co-op undermined more than a decade of hard work that had yielded tangible dividends for the farmers and first peoples, who were first marginalised by colonialism, then by apartheid, then free market fundamentalism and now through incompetence.

And just what are taxpayers to think about paying millions of their rands to break a working system that cost them nothing to set up? At the very least there ought to be a commission of inquiry.

Powerful arguments can be made to reinstate protective measures for our beleaguered agricultural sector. We need to support markets that work toward our national best interest. In doing so we must examine any state intervention so that food security and sovereignty are prioritised and emerging farmers supported.

Enabling our agricultural sector is pivotal not only to feeding ourselves but also to our future growth, employment and prosperity. A nation that cannot feed itself cannot prosper.

• Glenn Ashton is a writer and researcher working in civil society. Some of his work can be viewed at www.ekogaia.org

• This article first appeared on the website of The South African Civil Society Information Service (www.sacsis.org.za).

We cannot continue to rely on career politicians who fail to comprehend the fundamental realities of globalised agricultural markets.

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