"You know, use it or lose it will work now, with the recapitalisation and development with the strategic partnerships we will form with farmers whether active or retired," he told a media briefing in Cape Town.
"Our view is that [we should] give them a chance, establish a clear system of managing these farms, provide necessary support and those who do not want to work the land, take them out.
"There is not going to be any compromise on that part. The only thing that we thought we should strengthen is the support."
Failed or declining
Nkwinti pointed out that the principle would not apply to people who were given land as part of the reconstitution process.
"But those who got land through redistribution, if they don't use that land, we will take it."
The minister revealed last year that more than half the farms bought by government as part of its Land Redistribution for Agricultural Development programme had failed or fallen into decline.
On Tuesday, Nkiwinti put the figure considerably higher and painted an increasingly bleak picture of the overall state of land reform.
He said it was untenable that more than 90% of the 5.9 million hectares of land the state bought for emerging farmers was not productive and that the state was therefore losing revenue.
"More than 90% of those are not functional, they are not productive and therefore the state loses revenue.
"So we cannot afford to go on like that. We then say the agriculture sector's production as a proportion of the GDP is going down, this is part of the reason. That land has been given to people and they are not using it. No country can afford that.
Nkwinti said the state spent billions buying going concerns in the "hope that these things will continue to produce but this has not happened".
He said 15 years after the post-apartheid state introduced land reform, it was "not close to completing the process except in the Western Cape". He reiterated that government would not meet its target of turning over 30% of arable land to the black majority by 2014 as the state simply does not have the R72bn needed to achieve this.
Instead of setting a new deadline, the minister said, the department has decided to focus on making redistributed land more productive.
"We don't want to target now because we want to balance development. We want to [create a] balance between the number of hectares we get and the extent to which we use those hectares to produce food."
He said this informed the decision last year to adjust the ministry's budget to allocate 25% for recapitalisation - which will see some R254m flow towards 200 farms in distress.
Nkwinti said the efforts to salvage farming operations on redistributed land would include giving support to black farmers battling to pay their debt to the Land Bank.
The bank last July lifted a moratorium on repossessing land from emerging farmers that was introduced in 2002, but said recently it was, along with the ministry and private institutions, looking at fresh support for those in distress.
The minister said this would cost the state an estimated R207m in guarantees.
Nkwinti said his ministry's green paper on land reform was running late partly because officials were still working out how to structure strategic partnerships that will support the recapitalisation and development of emerging farm enterprises.
It is now scheduled to be published at the end of May.