For Unati Speirs, the head of agroprocessing at the Industrial Development Corporation (IDC), food is Africa’s new mining.
“By 2025, the Southern African Development Community will be among the world’s largest food consumers. By 2025, the population of Africa will reach 1.4 billion people and, by 2050, Africa will overtake China and India [in population size],” she says.
It’s therefore imperative that South African food producers position themselves to take advantage of a new food revolution for a growing population.
Speirs (36) controls a book of agriprocessing companies worth R7.3 billion to the IDC, along with a team of 10 chartered accountants and 15 other staff, from marketers to agriculturalists and food specialists. Together they receive requests for assistance from farmers and food producers and conduct due diligence on businesses to determine the value the IDC can help to unlock.
Speirs has a Master of Science degree in agriculture and is now doing her PhD in agriprocessing. She believes there is a lot of value in the sector, prompted in no small part by the increasing global popularity of food TV channels and shows such as MasterChef.
“The new generation of consumer is passionate about his or her food and wants it to be sustainably produced, wants to know where the food was produced, by whom and how it was made,” she says.
“People don’t just eat because they are hungry; they are concerned about how nutritious their food is and how they are contributing to the economy with their consumer spend. They also want the convenience of gourmet at a reasonable price.”
This, Speirs says, places environmentally friendly farming practices in South Africa in a unique position to score for generations to come.
Speirs cites the Coega Dairy near Port Elizabeth (see left) as a good example of how available opportunities can be maximised by the IDC partnering with the right business model. Milk from Coega is sold by the Shoprite group in South Africa and the rest of Africa.
The agriprocessing sector can make a real difference in the lives of those who work in it.
“A majority of people who work in agribusinesses have a low level of skills – it’s not like the health or chemical sectors, for instance, where a four-year qualification is a minimum requirement. It’s possible to start as a general worker and grow into a manager through workplace experience,” she says.
“By growing youth participation in agriculture, young people have the freedom to grow in the areas they come from that will reduce the pressure for urbanisation without infrastructural development, which in turn grows rural communities. Agriprocessing has the ability to grow the economy and jobs in the areas that need them the most.”
The IDC is also helping to transform the sector by financing worker trusts that enable a farm’s employees to buy significant stakes in businesses for which they and their families have worked for generations, something Speirs describes as a “win-win situation”. The corporation also funds equity partnerships and supports emerging black farmers who are linked directly to retail chains or export markets.
There are obstacles, though. One is a reluctance among young people to pursue a career largely deemed not sexy. Another is a lack of interest and information about the sector’s potential and economic opportunities.
Then, of course, there is the drought, the worst the country has experienced in 23 years.
“The IDC is responding by establishing an emergency fund in the four affected provinces for new and existing clients,” she says. “We’re expecting the drought to last until at least September 2016, and we’re expecting the situation to get worse by then, with floods and other related post-drought climatic conditions.”
Among Speirs’ favourite agribusinesses are those that have gone global – such as Dynamic Commodities, an IDC client producing sorbet that is now available in Japanese supermarkets.
“It’s like flying our flag. I get so proud when I arrive in [global grocery chains] such as Tesco and see one of our products,” she says.