africa an el dorado for south africa’s agribusiness...

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Africa an El Dorado for South Africa’s Agribusiness Giants

Contents

Key findings 3Introduction 4From agriculture to agribusiness 4 Whatisanagribusiness? 5What is driving agribusiness incursion and expansion on the continent? 6 Increasingconsumermarketandspending 6 Increasingreturnsoncommoditycropsandland 6 Increasingneedtosecurefoodandenergysecurity 7Enter South African agribusiness 9 Push-pullfactorsforSouthAfrica’sentryintoAfrica 10 Fiercemarketconditionsandcompetition 10 Landissues 11 Labourissues 11 Risingrawmaterialandinputcosts 12 Highreturnsoninvestment 12 Sizeandtypeofinvestment 13 Retailing 13 Agro-processing 14 Farming 16 Inputs—withafocusonseeds 18Support for agribusiness expansation in Africa 19 Infrastructureandincentives 20 Humanresourceissues 22 Integratedregionalmarkets 23 Innovationandtechnology 24The potential impact on Africa’s agricultural value chain 26 Marketstructure 26 Foodproduction 27 ImplicationsforAfrica’sfoodsovereigntymovement 28 Localinnovation 29 Equityandrights 29Conclusion 30Appendix 1: South Africa’s leading expansionist agribusinesses 32Appendix 2: Africa’s top 20 agribusiness companies 35References 37

The African Centre for Biosafety (ACB) is a non-profit organisation, based in Johannesburg, South Africa. It was established to protect Africa’s biodiversity, traditional knowledge, food production systems, culture and diversity, from the threats posed by genetic engineering in food and agriculture. It, has in addition to its work in the field of genetic engineering, also opposed biopiracy, agrofuels and the Green Revolution push in Africa, as it strongly supports social justice, equity and ecological sustainability.

The ACB has a respected record of evidence-based work and can play a vital role in the agro-ecological movement by striving towards seed sovereignty, built upon the values of equal access to and use of resources.

©The African Centre for Biosafetywww.acbio.org.zaPO Box 29170, Melville 2109 South AfricaTel: +27 (0)11 486 1156

Design and layout: Adam Rumball, Sharkbouys Designs, Johannesburg

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Africa an El Dorado for South Africa’s Agribusiness Giants 3

Key findings

• ThefarmtoforkagribusinessvaluechaininAfricaisworthbillionsofdollars,withSouthAfrica’sagribusinessdominatingthesector.TigerFoods,PioneerFoodsGroup,TongaatHulett,AstralFoods,AFGRI,IllovoSugar,AnglovaalIndustries(nowAVILtd),RainbowChicken(RCLFoods),CloverHoldingsandOceanoGroupareamongthetoptwentyAfricanbusinessesoperatingonthecontinent.SouthAfrican-ownedretailer,Shoprite,controlsastaggering34%ofthecontinent’ssupermarketretailmarket.

• Africaneconomiesaregrowingfasterthantheglobalaverage;itsmiddleclassesareexpectedtoexceedIndia’sinnumbersby2020,andby2030itstop18citieswillboastacombinedspendingpowerofUS$1.3trillion—US$400billionofwhichislikelytobespentonfoodeachyear.Thisisadynamicgrowthmarketforagribusinessandtoogoodanopportunitytomissforprofitmaking.

• SouthAfricainvestsinmoreAfricanprojectsthananyothercountry;theseprojectsincludemediaandtelecommunications,technology,retail,consumerproductsandfinancialservices,aswellaspropertydevelopment,buildinggrainmills,processingfacilitiesandregionaldistributioncentres,chickenandbeefoperationsandsugarplantations.StandardBank,Absa,FirstRandandNedbankarequicklyexpandingtheirservicestootherAfricancountries.

• SouthAfricanagribusinessisexpandingthroughself-fundedoperations,partnerships,mergersandacquisitions,particularlyinthefoodprocessingandretailingsectors.Ofthemergersandacquisitionsoccurringinthepastdecadeon

theAfricancontinent,21.7%ofthemhavebeeninstigatedbySouthAfricancompanies.CompaniesintheUnitedStateshavebeeninvolvedin28%ofmergersandacquisitions.

• PrivateequityinvestmenthasincreasedtoaroundUS$5billion,withmorethan25internationalinvestmentfundsfocusedontheagribusinesssector.ThesefundsincludetheSouthAfrica-UnitedKingdomEmergentAssetManagementfund,whichhasalreadysecuredlandin15Africancountriesandpromisesa30%returnoninvestmentfromcommodityfarmingandlandspeculation.AnotherisAgri-Vie,formedbySanlamPrivateEquityandStrategy.

• ThegrowingbiofuelmarketalsodrivestheacquisitionoflandinAfrica.SouthAfricansugargiants,IllovoandTongaatHulett,haveidentifiedethanolproductionasincreasinglyimportanttotheirfuturebusinessplans.

• Sevenofthetenleadingagribusinesses(TigerFoods,PioneerFoodGroup,AFGRI,IllovoSugar,AstralFoods,CloverGroupandTongaatHulett)arebackedbytheSouthAfricagovernment-ownedPublicInvestmentCorporation(PIC),whichisresponsibleformanagingtheSouthAfricanGovernmentEmployeesPensionFund(GEPF),theUnemploymentInsuranceFund(UIF)andtheCompensationCommissioner’sFund.

• Agribusinessesonthecontinentbenefitenormouslyfromaccesstoprivatecapital,experience,establisheddistributionchainsandbothdirectandindirectsubsidiesandincentivesofferedtothem.

• TheirentranceintoAfrica’srelativelyunsophisticatedagribusinessmarkethasthepotentialtoentrenchacultureofcorporateconsolidationonthecontinent,blocktheemergenceofsmalleroperators,depresslocalinnovationsystemsandnegativelyimpactonfoodsecurity.

In the 16th and 17th centuries Europeans believed that somewhere in the New World there was a lost city, a place of immense wealth, known as El Dorado. In his 1849 poem, writer Edgar Allan Poe

offers a suggestion as to the whereabouts of this lost city of gold.

Over the Mountains of the Moon Down the Valley of the Shadow

Ride, boldly ride If you seek for El Dorado.

4 A F R I C A N C E N T R E F O R B I O S A F E T Y

Introduction

SouthAfricanbusinessesinvolvedintheagriculturalvaluechain(millers,processorsandretailers)haveaggressivelyexpandedtheiroperationsintoAfricasincethe1990s.Thishasbeenachievedthroughown-fundedset-ups,acquisitions,mergersandpartnerships.TheirAfricandivisionsareincreasinglyprovidingahighreturnoninvestment,fuellingfurtherexpansionplansonthecontinent.

Bothpushandpullfactorsshapetheexpansiondrive.Theserangefromlocalmarketconditionstothepotentialprofittobemadefromarapidlyurbanisingpopulationwithincreasinglevelsofdisposableincome.Poorinfrastructure,weakgovernancestructuresandlowlevelsofhumanresourcesaresomeofthechallengesfacedbycorporateagribusinessonthecontinent;however,SouthAfrica’smajorplayersarewellplacedtoovercomethesetrialsthroughtheiraccesstocapital,technology,marketexperienceandincentivesofferedbyAfricancountries.ThisexpansiontakesplacewithinaninstitutionalandpolicyframeworkthatfacilitatestheaggressiveencroachmentofforeigncapitalintoAfrica’sagribusinesssector.

ThispapertracestheexpansionofleadingSouthAfricanagribusinessesintoAfricanmarkets;examinestheirrationaleforexpansion;highlightstheirchallengesandsuccesses;andprovidesananalysisoftheirpotentialimpactonthecontinent’sagriculturalvaluechain,intermsofentrenchingacultureofconsolidationandtheirinfluenceonfoodsecurityandlocalinnovation.

Althoughsomeoftheagribusinessesdiscussedinthispaperhaverecentlybeenacquiredbyinternationalcompanies(PioneerHi-bredacquiredPannarin2012)orhaverelocatedtoalternativebases(AFGRImoveditsAfricanbusinessoperationstoMauritius),alloriginatedinSouthAfrica,benefitedfromhistoricalsupportandpracticeaparticularbrandofexpansion.Anexplorationofforeigncapitalenteringthecontinent’sagribusinesssector,whileaworthwhilestudy,isoutsidethescopeofthispaper.

From agriculture to agribusiness

Tradeinfoodwasperhapsthefirsteconomicactbyhumankind,andourfirstformofwealth.Ashumanbeingsbegantoorganiseandadoptandcreatetechnologythroughwhichtoaccumulatemorefood,andthuswealth,thebeginningsofindustryweresetinplace.Sotheshiftfromlocalvillagemarketstobigger‘wholesale’marketswithsomeretailoptionswaspartofaprocessthatwouldleadtofurtherspecialisation.Thiswasspurredonbythepossibilitiesoflong-distancetradeandthentheestablishmentofspecialisedgrowingareasandfinallyrefrigerationtechnologyandmotorisedtransport.1Justasagricultureandtradeinfoodinfluencedindustry,industrythinkingbegantopervadefoodproductionindevelopedcountries,withfarmsrunlikefactoriesandaconcentrationonefficiency,volumeandprofit.2Andthentheretailsectorradicallyhonedtheentiresystembyintroducingself-servicestoresandthesupermarketwasborn.3

Today’scurrentfoodsystem,fromproductionandprocessingthroughtodistribution,isaglobalone.Globalisationhastransformedthelocalisedfoodsystemsoftheworldinto“anintegratedandlinearworldsystembasedontheprinciplesofcomparativeadvantage,standardization,geographicaldivisionoflabourandcontrolbyafewcorporationsandtradeagreements”—withfoodandfoodproductsnowsourcedgloballyandmainlyfromindustrialisedfarms.4Themodernfoodsystemofthedevelopedworldisdominatedbyoff-farmactorswithfarmershavinglittleinputintopricingorpolicy-making;anditisdrivenbyprocessors,tradersand,increasingly,retailers.5Controlofthesystemnowrelieson“controllingthemeansofco-ordinationratherthanthemeansofproduction”.6

Thisshiftfromagri-“culture”toagri-“business”inthedevelopedworldhasoccurredwithinadominantagriculturalnarrativethat,fromthe1900sonwards,hascentredonmodernisation,includingtheuseofhybridtechnologies,mechanisationandexternalinputs.7The


rationaleisthatmodernisationleadstoincreasedproduction,whichleadstoincreasedincomesandhigherstandardsoflivingforthoseinvolvedintheagriculturalvaluechain.8/9Thecurrentdrivetomoderniseagricultureanditsup-anddown-marketlinkagesinAfricaisframedwithinthisparticularnarrative,whichisperpetuatedatthehighestgloballevels10/11/12andrestsontheneedtoradicallyincreaseyieldstofeedagrowingAfricanpopulation,13/14/15estimatedtobeover2billionby2050.16

Themodernitynarrativeignoresthefactthatalthoughmodernfarmingmethodshaveresultedinyieldincreasesoverthepast50years,17thishasnotnecessarilytranslatedintoincreasedaccesstofood,increasedincomeorincreasednutritionalsecurity,18ecologicalsustainabilityorsocialjustice.Italsopresentsaone-dimensionalviewpoint19denotingasimplisticunderstandingofsocial,economicandecologicalsystemsofAfricaandhowtheyinteract.Thisnarrowunderstandingisnotadequatetodealwiththeinterconnectedcomplexitiesofthecontinent’scurrentchallenges,20/21suchasfoodinsecurity,biodiversitylossandclimatechange.

FramingthemodernisationofAfricanagribusinesswithinthisnarrow,one-dimensionalnarrativealsomasksthemoreprobableunderlyingmotivationsforcorporateagribusinessexpansion.Theseincludethedesiretoopenupnewconsumerandproductmarketsforhybridandgeneticallymodifiedseed,inorganicfertilisers,herbicides,pesticides,mechanisedfarmingequipmentandprocessedfoods.

What is an agribusiness?

Agribusinessesarethoseoperatingonthecontinuumbetweenfarmandfork.22Agribusinessencompassesthosefarmingtheland(individual,contractandcorporatefarmers),thosesupplyingtheinputs(seed,fertilisers,pesticides)andfarmingequipment,thoseaddingvaluethroughprocessing(millers,bakers,canners)tothosespecialisinginpackaging,distribution,marketingandretailing(supermarkets).23Banksandinsurancecompaniesincreasinglyparticipateinagribusinessventuresandleadinginternationalconsultingandauditingfirms,suchasDeloitte,havededicatedagribusinessteamsofferingadviceandexpertisetofarmers,manufacturers,marketersandagriculturaleconomists.24Figure1depictsatypicalagribusinesssupplychain.

Agribusinesscanbelocal,national,regionalorinternationalinscope.AgricultureplaysasignificantroleinAfricancountries.Asasectoritcontributesthemosttothegrossdomesticproduct,rangingfrom33.6%inRwandato76.9%inLiberia,andanaverageof44%(whencombinedwithagribusiness)acrossthecontinent.25SouthAfricaisanoutlierasitsagriculturalsectorcontributesonly3%togrossdomesticproductandemploys9%oftheworkforce,26incontrasttomostAfricancountriesinwhich65%ormoreoftheworkforceisemployedinagriculture,rangingashighas92%inBurkinaFaso.27Smallholdersstillproduce90%ofAfrica’sagriculturaloutput.28

Figure 1: A typical agribusines supply chain

Source:WorldBank2005

Inputindustry Producers Processors Retailers Consumers

Agriculturalproduction Foodindustry Consumption

POLICY LEVEL


What is driving agribusiness incursion and expansion on the continent?

Agribusinessisviewedbybothpublicandprivatesectororganisationsasavehicletoalleviatepovertythroughincreasedeconomicgrowth,ledbyprivatesectorinvestmentincentivisedbythepotentiallyhighprofitstobemade.

TheWorldBankarguesthatthekeyforeconomictransformationanddevelopmentonthecontinentcouldliewithagricultureandagribusiness,29estimatingthatthetwosectorscombinedcouldcompriseaUS$1trillionindustryinsub-SaharanAfricaby2030.30Thetheoryisthatincreasedagriculturalproductivitywillleadtoincreasedfarmerincomes,higherlevelsoffoodsecurityandincreasedemploymentopportunities.31AccordingtotheWorldBank,Africawillnotachieveitsdevelopmentalgoalsifattentionisnotpaidtoagribusiness.32

IntheinstitutionalspaceinAfricaagribusinessisviewedasavehicletocreateon-andoff-farmjobs;developruralinfrastructure,includingschoolsandclinics;33enabletechnologytransfer;improvebusinessservices,includingsupplyofinputs,technicalassistanceandcredit;andlowerfoodcostsonaregionallevel.34Inshort,agribusinessisviewedbymanyasapointofinterventionatwhichinnovationcouldhavea“widespreadandprofoundeconomicandsocialimpact”.35However,itismoreprobablethatthepotentialforgeneratingprofitdrivesinvestmentandexpansioninthesector,withlittleregardforAfrica’seconomic,socialorenvironmentallong-termsustainability.

TheComprehensiveAfricaAgricultureDevelopmentProgramme(CAADP),whichprovidesaframeworkforagriculturaldevelopmentandgrowthonthecontinent,36supportspoliciesandsystemsthatwillattract

foreigndirectinvestmentinthecontinent’sagriculturesector.37TheestimatedinvestmentgapintheagriculturalsectorisestimatedtorequirearoundUS$90billionannually,38tobemetbyprivatecapitalinvestment.39

Increasing consumer market and spending

CurrentlyAfricaneconomiesaregrowingfasterthantheglobalaverageandtheircitizenshaveincreasinglevelsofdisposableincomeanddisplayhighlevelsofconsumerconfidence.40Thisisappealingtothoselookingforafastandhighreturnoninvestments.Africathuspresentsarelativelyuntappedmarketforthoseinagribusiness,basedonestimationsthat:

By2020,Africa’smiddleclassarguablywillexceedIndia’sinnumbers41andthenumberofAfricanhouseholdswithincomesexceedingUS$5,000willincreasefrom85millionto128million.42TheywillspendUS$174billiononfoodandbeverages.43SeeFigure2fortheprojectedvalueandurban/ruralsplitofsub-Saharan’sfoodmarketby2030;theurbanfoodmarketisprojectedtobeworthUS$400billionby2030.44/45

By2030,Africa’stop18citieswillhaveacombinedspendingpowerofUS$1.3trillion46anditsworkforcewillbe800millionstrong.47

By2040,Africawillbehometooneinfiveofthepanet’syoungpeople.48

Thispresentsadynamicgrowthmarket;however,itshouldbenotedthattheattractionofurbanisationisoftennotthepullofbetterpaidjobsinthecity,butratherthepushofruralpoverty.49ItshouldalsobenotedthatdefiningthosespendingbetweenUS$2toUS$20adayasmiddleclassisproblematicgiventhatthepovertylineforthedevelopingworldissetatUS$2apersonaday.50

Increasing returns on commodity crops and land

Investorslookingtocashinontheincreasingrateofreturnarisingfromagriculture,increasingcommoditypricesandspeculativeinvestmentbasedonlandvalues51aresecuringAfricanfarmland.

Theflowofprivateequityinvestmentinto


Africaisontherise—currentlymorethanUS$5billionhasbeenallocatedtoAfricanagribusiness52andthereareover25investmentfundsfocusedonthissector.53OneoftheseistheSouthAfrican/UnitedKingdomEmergentAssetManagementFund,whichhasraisedmorethanUS$450millionforinvestmentintofarmlandinsub-SaharanAfrica.54Bylate2010,landhadbeensecuredinAngola,Botswana,theDemocraticRepublicofCongo(DRC),Kenya,Lesotho,Madagascar,Malawi,Mauritius,Mozambique,Namibia,SouthAfrica,Swaziland,Tanzania,ZambiaandZimbabwe.55A30%returnispromisedtoinvestors.56AnotherexampleisAgri-Vie,theUS$100millionprivateequityfundformedbySanlamPrivateEquityandStrategy,forthesolepurposeofinvestinginbusinessesoperatingalongtheAfricanagribusinessvaluechain.57

Asanexample,inWestAfrica(themostpopularchoiceofdestinationforinvestment)investorscanacquireuncultivatedlandforlessthanUS$100perhectare;beginproducingpalmoilorrubberataninvestmentcostofUS$5,500perhectare;andrealiseavalueofUS$16,000perhectare.58Inthisregionahigherreturnoninvestmenttendstobebasedonhigheryield;forexample,asingledry-landhectareinCongo-Brazzavillecanyield10tonsofmaizeasopposedto3tonsinSouthAfrica.59

Acharacteristicoftheselanddealsisthattheyareexportorientedinnatureandoftenfocusoncashcropsandbiofuels;Africahaslimitedcapacitytoabsorbeither.60Volatile

commoditymarketsarealsonotthemostsecureorsustainablevehiclethroughwhichtotransformthefortunesofthecontinent—acontinuedlong-termdeclinewouldhavedisastrousimplications.61Itisworthnotingthatforeigndirectinvestmentinfarmlandcanreducefoodsecurityifittakeslandawayfromfoodproduction—forbiofuelorcommoditycrops,forexample—orifthefoodisdestinedforexportasopposedtolocalconsumption.62

Increasing need to secure food and energy security

Land,accesstoitandownershipthereof,isaboneofcontentionaroundtheworld,andincreasinglyitisbecomingascarceandcontestedresource.63TherehasbeenunprecedentedacquisitionofAfricanfarmlandinthepasttwodecades,byforeigncountriesdrivenbyadesiretoensuretheirownfuturefoodsecurity(forexample,China,SouthKoreaandIndia64)orbythosefacingincreasingconstraintsontheirnaturalresources,suchaswater(forexampletheGulfStates,SingaporeandMalaysia65),orontheirabilitytotrade(duetorestrictiveexportrestrictions).66

ThereasonsgivenbycountrieslookingtoacquirelandinAfricaisthatthecontinenthasmorethan300millionhectares67oftheworld’s1.5billionhectaresofarableland—currentlyvaluedatUS$5trillion.68Thatonly183millionhectaresofthislandiscurrentlybeingfarmed69impliesthatthecontinenthastheworld’sgreatestreservesofarableland,

Figure 2: Projected value of food markets in sub-Saharan Africa by 2030


untappedwatersupplies(lessthan2%ofwaterreservesareused),proximitytoseveralinternationalmarkets,70aswellashistoricallylowerproductioncosts.71Thesefiguresmustbeinterrogated,asestimationsof‘unused’arablelanddonottakeintoaccountunofficialandundocumenteduseofthelandfortraditionaluses,suchasshiftingcultivation,dryseasongrazing,72wildplantgatheringandwateraccessoritsroleasasafetynet.73Inaddition,inAfricainparticular,traditionalownershiporuseoflandisoftennotofficiallyorlegallyrecognised.74/75Muchofthislandisforestedandprovidesvaluableecosystemservices;consequentlyitsconversionintofarmlandhasnegativeecologicalimplications.76Despite

claimsofmassiveuntappedwatersupplies,waterremainsascarceresourceontheAfricancontinent—millionsstruggletoaccesssafedrinkingwaterandwatermanagementmodelsareinsufficient.77AsmoreAfricansmovetocitiesincreasedpressurewillbeputonwatersystems.78Inaddition,projectedclimatechangeimpactsonalreadyvariablerainfallpatternsneedtobetakenintoaccount.79/80

TheFAO’sVoluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security and the African Union’s Declaration on Land Issues and Challenges in Africaoutlinestherisksandprincipleson

LANDGRABS

AccordingtotheLandMatrix,aglobalandindependentmonitoringinitiativethataimstopromotetransparencyandaccountabilityinlandinvestmentdecisions,over150foreignlanddealshavebeenconductedinAfrica—about30inCentralAfrica,116inWestAfricaand5inSouthernAfrica—withmanymoreinthepipeline.94Since2000,therehavebeenover50landdealswithforeignersinTanzania—comprisingabout1.2millionhectares95andin2009alone,about60millionhectaresofAfricanlandwaspurchasedorleasedbyforeigncountriesandcompanies.96HottargetsforlandacquisitionsareMauritius,Uganda,Rwanda,Burundi,Togo,Nigeria,GambiaandSierraLeone,asthesecountrieshavethemostarablelandavailable.97ThesedealsarefacilitatedbyAfricanstateslookingtoattractforeigndirectinvestment.Forexample,Ghanaallowsforeignownershipoflandthrough50-yearleaseagreementswithoptionstorenew98andZambiaoffersfacilitatedaccesstoland,99with99-yearleaseagreements.100

Characteristics of these deals

Thereisalackoftransparencyaboutthesedeals,includingtheirextent,thecostpaidforthelandandtheintendedpurposeoftheuseoftheland.101

Theyoftenrelyonandinvolvebilateralagreements102/103andincludedirectstateinvestmentorindirectinvestmentthroughstateloansorgrants.104/105

Theyareexportorientedinnature,oftenfocusingoncashcropsandbiofuels.106

Theyoftenincludefreeaccesstowater,taxexemptionsandrepatriationofprofits.107

PotentialimplicationsforAfrica[sub-heading]

Thedevelopmentofinfrastructureandlocalmarkets,oneoftheconditionsforinvestment,oftendoesnotoccurandcannotbeenforcedretroactively.108

Arablelandandincreasedagriculturalproductionwillneedtomeetlocalfoodneeds,giventheprojectionofadoubledsub-Saharanpopulationby2050.109

Large-scalelandacquisitionscouldresultinlocalpeoplelosingaccesstotheresourcesonwhichtheydependfortheirfoodsecurity.110

ManyAfricancountriesdonothavethelegalmechanismsorcapacitytoprotecttraditionallandrights.111This,combinedwithalackoftransparency,putsAfricanfarmersatgreatrisk.112


whichlanddealsshouldbebased.81Theseincludemappinganddocumentinglandrights,interestsandclaimswithanemphasisontheinclusionofsmallholdersandcommunitiesandtheprotectionofnationalfoodsecurity.82Rwandaiscompletinganationwideprogrammetoissuelow-costlandtitles;Coted’Ivoire,BeninandBurkinaFasoarepilotingrurallandtenuremaps;Tanzaniahasnearlycompletedsurveyingitscommunallands;andMozambiqueandGhanaarescalinguppilotprojectsfortheregistrationofcommunalland.83ItshouldbenotedthatwhileclarityaroundlandownershipcouldbenefitAfrica’ssmallholders(whocouldgainmoresecuretenure),themovetowardsmappingcommunallandsandregisteringlandparcelscouldalsobeasteptowardsthewholesaleprivatisationofland.84Forexample,mostlanddealsinAfricainvolvenoorlowlandfees;andnegotiationstakeplacebetweenstateintermediaries.85Thiscouldleadtothepoliticalelitebeingincentivisedtodispossesslocalsoftheirland,aswellascontributetorisinglandcosts.86Increasedcostoflandalsohasnegativeimplicationsforpeasantsandsmallholderswholackthecapitaltostayinthe‘game’87whenspeculationaroundlandraisesprices.

AnadditionaldriverfortheacquisitionofAfricanlandisthegrowingmarketdemandforbiofuelcrops.88Demandforethanolisincreasingrapidlyandglobalproductionhasmorethantripledsince2000,equalling38.4milliontonsby2010.89Itisestimatedthatby2030biofuelproductionwillrequire35millionhectaresofland.90ASwiss-basedenergycorporation,asubsidiaryofAddaxandOryxGroup,spentGPB258millionin2011,tolease10,000hectaresfor50yearsinSierraLeone,togrowsugarcaneforethanolproductionforexporttoEurope.91SouthAfricansugargiants,IllovoandTongaatHulett,haveidentifiedethanolproductionasincreasinglyimportanttotheirbusinesses,withplansforfurtherexpansionintothissector.92/93ThiswillhavemajorimplicationsforAfricanfoodsecurity,ifarablelandisdivertedtotheproductionofbiofuelcrops.

Enter South African agribusiness

SouthAfricanagribusinessexpansionintotherestofthecontinentisspurredonandsupportedbynationalimperatives.SouthAfrica’sNational Development Plan: Vision for 2030notesthata“capable,strong,competitiveandwelldevelopedagribusinesssectorisessentialtoensuretheglobalcompetitivenessofourdifferentagro-foodvaluechainsandthusfoodsecurity”.113Itfurthernotesthatfactorssuchascompetitiveaccesstofinance,technologyandmarketscontributetothestrengthofthecountry’sagribusinesssector,114whichisarguablythemostdevelopedandsophisticatedonthecontinent.ItmustbenotedthatownershipandcontrolofSouthAfrica’sagribusinesssectorreflectsthefragmentedallocationofbenefitsandburdenstodifferentracegroups,gendersandgeographicalareas,asinflictedbytheapartheidregime—inparticular,accesstoarableland,water,education,subsidiesandcredit.115Eventhougheconomicliberalisationremovedthissupport,thisgroupcontinuestoenjoytheentrenchedbenefitsofsupport,alongwithaccesstoqualityinfrastructureandaccumulatedcommercialknowledge.116/117

ItisworthnotingthatthemajorityofcompaniesdiscussedinthispaperarebackedbythePIC,whichisresponsibleformanagingthesubstantialSouthAfricangovernmentpensionandunemploymentfunds.ThePICmanagesassetsworthmorethanR1.4trillion.118WhileoneofitsdivisionsfocusesonSouthAfrican-basedprojectswithdevelopmentalimpact,thePICisincreasinglylookingtoAfricanmarketsforincreasingreturnsoninvestment.119In2012theyinvestedinEcobankTransnationalIncorporated(Nedbankownsa20%stakeinEcobank),operatinginmorethan35countriesinAfrica,followedbyinvestmentinDangoteCementinNigeriaandintocompaniesworkingintheedibleoilrefinerysectorandhospitality.120Theyarelookingtoinvestininfrastructure,particularlyport,railandairports,aswellasagriculturalindustries,oilandgas,andinformationandcommunicationstechnology.121


SouthAfricancompaniesdominatetheAfricanagribusinessmarket.Theyappearedtentimesonalistofthetop20Africanagribusinessesoperatingonthecontinentin2010(seeAppendix2),withthreeentriesfromMoroccoandNigeria,twofromCoted’Ivoire,onefromAlgeriaandonefromEgypt.Thelistrankscompaniesaccordingtoturnover.122TheSouthAfricancompaniesare:TigerFoods,PioneerFoodsGroup,TongaatHulett,AstralFoods,AFGRI,IllovoSugar,AVI,RainbowChicken(nowRCLFoods),CloverHoldingsandOceanoGroup.123(SeeAppendix1foralistofthemainbusinessactivities,locations,shareholderinformationandtherevenuegeneratedfromAfricandivisionsforthesecompanies.)Inaddition,SouthAfrican-ownedShopriteHoldingsisthecontinent’sbiggestsupermarketchain.124SouthAfricahoststheheadquartersof16leadingAfricanagribusinesses,includingNigerianBreweries.125Figure3providesanoutlineofthetopSouhAfricanandinternationalfirmsoperatinginthesub-Saharanagro-foodsupplychain.

Push-pull factors for South Africa’s entry into Africa

DuringthetransitionperiodleadinguptoSouthAfrica’sfirstdemocraticelectionsin

1994,localcompaniesbeganlookingtoexpandintoAfricaandtheinternationalmarket.126SouthAfrica,aswithmanyAfricanstates,hadliberaliseditseconomicpolicies,privatisedmanypreviouslystate-controlledentitiesandopeneditselfuptocompeteinaglobalisedtradingmarket.127TheSouthAfricanmarketwasconstrained,oversuppliedandofferedlimitedprofitmargins.128Consequently,localcompanieswereeagertoexplorethenewopportunitiesofferedforcapitalaccumulationbyneighbouringstates.Figure4indicatestheagriculturalsub-sectorstargetedforacquisitioninAfricabetween2006and2011.

Thepushfactorsforexpansionincludefiercemarketconditions,insecurityaroundland,risinginputcostsandlabourissues.

Fierce market conditions and competitionIncreasingconsolidationintheSouthAfricanagribusinessmarkethasforcedcompaniestolookelsewhereforincreasedmarketshareandreturnoninvestment.129Cheapimportsarefuellingconsolidationofthelocalindustry,asincreasinglysmalleroperatorsareunabletocompeteandareacquiredbybiggerplayers130whoarealsotakingstrain.ThedumpinginSouthAfricaofpoultryproductsthatoriginateinBrazilandtheEuropeanUnionhasaffected

Figure 3: The sub-Saharan agro-food supply chain: presence of large and local firms (2008)

Agricultural inputs

Top5foreigncompanies:• BASF• DowChemicals• Bayer• DuPont• LindeGroup

Top5Africancompanies:• SASOL• AECI• OmniaHoldings• ChemicalServices

Industries• ChimiquesdeSenegal

Food processors

Top3foreigncompanies:NestleUnileverArcherDanielsMidlandTop3Africancompanies:TigerBrandsTongaatHulettAFGRIBeveragesTop3foreigncompanies:CocaColaInBevAnheuser-BuschTop3Africancompanies:SABMiller

Food retailers or distributorsNoforeigncompanies:

Top5Africancompanies:BidVestGroupShopriteHoldingsPicknPayStoresMassmartHoldingsSparGroup

FoodservicesTop3foreigncompanies:CompassGroupMcDonald’sSodexo

Farm

s/fa

rmla

nd p

urch

ases

Cons

umer

s

Source:OECD2008(modifiedtoreflectsub-SaharanAfrica)


theprofitabilityofagribusinessgiantssuchasRainbow(RCIFoods),AFGRIandAstralfoods,131/132andthesugarindustry(IllovoandTongaatHulett),whoarestrugglingtocompeteagainstcheapsugarimportsfromIndiaandBrazil.133Thesegroupsclaimthatgovernment’srecentincreasesinimporttariffsfortheseproductswillnotbeenoughtosecurethesustainabilityofthelocalmarket.Over-regulationiscitedasanotherreasonwhySouthAfricanagribusinessesarelookingelsewhereforgrowth;Shoprite,forexample,claimsthatonerouslabellingrequirementsandthestringentConsumerProtectionActarecuttingintoitsprofits.134

Inaddition,localagribusinessisfeelingthepinchasconsumerswithincreasinglyhighlevelsofdebtreducetheirspending.Clover,Rainbow,AVI,AFGRIandAstralhaveindicatedthatdepressedconsumerspending,withnoreliefinsight,isafactorlimitinggrowthintheSouthAfricanmarket.135/136/137/138CloverhasnotedthattheglobalfinancialrecessionandvolatilityoftheRandarepushfactorsfortheirAfricanexpansionplans,139asdoesRainbow,citingalsotheabove-inflationarycostsforpowerandfuel.140/141TheweakerRand,accordingtoAVI,hasalsoincreasedpressureoninputcosts,142andAFGRIhasstatedthattheinternationaloilpriceandthevolatilityofcommoditypriceshavenegativeimplicationsforgrainproduction.143

Land issuesAccesstoarablelandandwaterarealsobecomingchallengesinSouthAfrica.144AFGRInotesthelossoflandinMpumalangatominingactivitiesandthatfarmersarefacingwaterscarcitiesacrossthenation.145UnresolvedissuesaboutlandredistributioncontributetouncertaintyaboutthefutureofagribusinessventuresinSouthAfrica.146Forthosecompaniesreliantonaccesstoorownershipoffarmland,includingRainbow,TigerBrands,Clover147andAFGRI,148landreformandredistributionwillhaveseriousconsequences.RumoursoftherulingAfricanNationalCongresspartywantingtotransfer30%ofthecountry’sarablelandtopreviouslydisadvantagedfarmersby2014hascausedunease,149whiletherecentannouncementthatregisteredcommercialfarmshaveuntilearly2015tohandoverhalfownershipoftheirfarmstoworkersiftheydonotparticipateingovernment’swillingbuyer-willingsellerredistributionprogrammehasdeepenedthisunease.150Thisstatementhassincebeenretractedbygovernment.ThishasresultedinlocalagribusinesseslookingtootherAfricancountriesforgrowthopportunitiesandnewmarkets151andthepotentialtomakeaneconomickilling.

Labour issuesFormostofthesecompanies,labourunresthasaffectedprofitsoverthelastfewfinancial

Figure 4: Acquisition activity by target agricultural sub-sectors (2006–2011)

Source:CapitalIQU,Press,CopalResearch


years.152/153AFGRIcitesthehistoricfarmworkerstrike154andShoprite,RainbowandAstralFoodstheprolongedminingstrikesashavingnegativelyaffectedsales.155/156/157Inaddition,companiessuchasCloverindicatethatincreasinglocallabourcosts158and[thefact]thatSouthAfricanwages[are]outstrippingproductivity159furtherdepressprofitmargins.160

Rising raw material and input costsAstralnotesthatlocalmaizeandsoyapriceshavebeenatrecordhighsaffectingprofitability.161ThishasledSouthAfrica’spoultryproducers,accordingtoRainbow,tolooktoAfricanmarketswheremaizeandsoyaproductioncostswerelowerorsubsidised.162Illovoperceivesthesteepriseininputcostsforsugarproductionasaconstraintongeneratingprofit.163

AccordingtotheAgbiz/IDCconfidenceindexforthethirdquarterof2013,onlyhalfofagribusinessdecision-makersandexecutivesarepositiveaboutthelocalagribusinessenvironment.164Whilethe2013/2014AgribusinessInsightsSurveybyPricewaterhouseCoopers(PwC)indicatesthat70%ofsurveyedchiefexecutiveofficerswanttoexpandintoAfricaand90%ofthosewhohadalreadyexpandedtheiroperationsintothecontinentanticipatedarevenueincreaseduring2014.165

ThepotentialprofitstobemadefromAfrica’semergingconsumermarketaredrivingagribusinessexpansionplans.TheUnitedNationsDevelopmentProgrammeestimatesthatAfrica’smiddleclasswillexceedIndia’sinnumberby2020166andthisincreasewillbeaccompaniedbyariseindisposableincomelevels.167AnestimatedUS$174billionwillbespentonfoodandbeverageseachyear.168Thisishistoricallyunderservedmarketisveryappealingtolargeagribusiness—fromsuppliers,anufacturersandprocessorstoretailers.

High returns on investmentShopritechiefexecutiveofficer,WhiteyBasson,claimsthatAfricaiswherethereallyprofitableactionis.Byend2012,theturnoverfromShoprite’sAfricanstoresrepresented11.1%ofthegrouptotalandby2014turnoverwas12%higherthaninSouthAfricanstores.Salesin

Shoprite’sAfricanstoresrose28.1%inthelastsixmonthsof2013providinga45%returnoninvestment—thisdespiteslowgrowthforthegroupoverall.

Asearlyas2003Massmartacknowledgedthat“businessbeyondSouthAfrica’sbordersearnsfarhighermargins,theaveragestoreoutsideSouthAfricaisearningtwiceasmuchinbottom-linetermsasstoreswithinSouthAfrica”.169/170In2011Massmartwasacquiredbytheworld’slargestretailer,Walmart,inadealthatrequiredcompetitionapprovalinsixAfricancountries—SouthAfrica,Swaziland,Zambia,Namibia,TanzaniaandMalawi.171ItplanstoenterAngolaby2015andhavefourstoresinthecountryby2017andiscurrentlybuildingitsfirststoreinKenya.172Agro-processorssuchasOceanaaregenerating19%oftheirsalesrevenue(2013)fromAfricancountriesotherthanSouthAfricaandNamibia,whichgeneratedthemost,whileonly10%ofrevenueisderivedfromEuropeandtheFarEast.173

Attheendof2013WoolworthscloseditspilotstoresinNigeria,citingpoorprofitsandthechallengingbusinessenvironment;Shoprite,however,continuestodowellinthesamelocation,indicatingthatthepricepointforgoodsisimportant.174

Inaddition,agribusinessexpansionissupportedbybusinesssynergies.Forexample,Shoprite’spresenceonthecontinent(ithasstoresin1,525corporateand377franchiseoutletsin16Africancountries)facilitatestheexpansionofotherbusinesses.Clovernotesthatdairyexportsintosub-SaharanAfricahavebenefitedfromtheaggressiveexpansionofSouthAfricansupermarketsintotheregion.175TherearealsoconnectionsbetweenthesubsidiariesofSouthAfricancompaniesinAfrica.Forexample,ShopriteappointedZambeefinZambiatooperatethecompany’sin-storebutcheriesinitsZambian,GhanaianandNigerianstores,176andZambeefisinajointventurepartnershipwithSouthAfrica’sRCL

ShopritesoldmorebottlesofJCleRouxsparklingwineinits19Angolanstoresthanits1,400-oddSouthAfricanstoresandmorecansofRedBullinjustfiveAngolanstoresthaninSouthAfrica’sentiregroupinthelastsixmonthsof2013.


Foods.177OthermultinationalcompanieswillpiggybackontheexpansionofSouthAfrica’sagribusinesses.Forexample,ChickenLicken,constrainedbyinconsistentchickensupplieswhentryingtoexpandintotheNigerianmarket,hasindicatedthatitwillfollowinthefootstepsofRainbowChickentoguaranteequantityandqualityofchickens.178

Size and type of investment

SouthAfricaninvestmentintoAfricaisledbytheprivatecorporatesectorandfocusesmainlyonthetelecommunications,financialservicesandretailsectors.179SouthAfricanagribusinessesareinvestinginfarmingenterprises(directownership,landleases,contractfarming),retailing(directownership,jointventures,franchising),processing(milling,value-adding),supplyofagriculturalinputs,andfoodproducts.ThemaintargetsformergersandacquisitionsaretheAfricanfoodprocessingandretailsectors;SouthAfrica(21.7%)andtheUnitedStates(28%)dominatemergersandacquisitionswithinthesesectors.180

SouthAfricaexportsfourtimesmorethanitimportstootherpartsofAfrica—investmentinacquisitions,mergersandstart-upsinotherAfricancountriesincreasedfromR9billionin1997toR30billionin2002,181primarilyintheformofshoppingmalls,fast-foodoutlets,foodandretailchainsanddepartmentstores.182Between1994and2012,exportstothecontinentrose7.6%from10%withanestimatedvalueofR157billion.183

SouthAfricainvestsinmoreAfricanprojectsthananyothercountry(examplesincludebankingandinsuranceservices,agro-processing,informationtechnologyandtelecommunications),althoughtheamountinvestedisnotthehighest.184India,theUnitedStates,UnitedKingdom,CanadaandChinainvestthemostcapitalinthecontinent.185Thenumberofoverallprojectshasincreasedbyover500%inthelastdecade,with75initiatedin2013aloneataninvestmentofR14billion.186AccordingtoErnst&Young’slatest2014AttractivenessSurvey,Africahasrapidlymoveduptheranksfromthirdlastin2011tosecond-mostattractiveinvestmentdestinationintheworldin2014.187Thevalueofforeigndirectinvestmentprojectsonthe

continentby2014wasUS$52,6billion,withanincreasingnumberofintra-Africanprojects(22.8%in2013)encouragedbythecreationofregionalvaluechainsandstrongerregionalintegration.188SouthAfricaleadsthewayvis-à-visintra-Africanprojects,followedbyKenyaandNigeria.189Therehasbeenashiftinprojectfocusfromtheextractiveindustries(miningofmetalsandcoal,oilandnaturalgas)toconsumer-relatedindustries(includingmediaandtelecommunications,technology,retail,consumerproductsandfinancialservices).190Ernst&YoungestimatesthatSouthAfrica’sforeigndirectinvestmentintoAfricahascreatedover45,000jobssince2003.191

SouthAfricancompanieshavealsoexpandedservices(bankingandinsurance)tothecontinent.StandardBankoperatesin17Africancountries;AbsaboughttheAfricashareofBarclays,itsparentcompany,andoperatesin12countries;FirstRandboughttheMerchantBankofGhana;andNedbankhasaccessto35Africancountriesthroughits20%stakeinEcobank.192

RetailingTheSouthAfricanfoodretailmarketisdominatedbyfourcompanies—Shoprite,Pick‘nPay,WoolworthsandSpar.Theformertwoenterprisesdominatetheformalsector,eachofthemhavingacquiredaround40%controlby2003.193SouthAfricansupermarketsareenteringAfricainsearchofhighprofitratesandtoescapethesaturationornearsaturationofthelocalmarket.

Shoprite,nowAfrica’sbiggestsupermarketchain,operatesthrough1,525corporateand377franchiseoutletsin16Africancountries;by2010itheld34%ofthesupermarketmarketshareonthecontinent.194FurtherexpansionplansincludebuildingaregionaldistributioncentreinNigeriaalongwithanother20to30storesandbuildingalogisticscentreinAngolawithanadditional21stores.ShopritewasthefirstSouthAfricanretailertoopenintheDRC.HavingafootprintinmorethanoneAfricancountryisbeneficialfortheexpandingagribusiness.Itreducestheriskofpoliticalandeconomicinstabilityhavingadevastatingeffectonearnings;itallowsforanearly-moveradvantageinunderdevelopedmarkets;anditprovidessufficientscaletomaximiseprofits.195


ShopriteisanexampleofanagribusinessthathasbuiltupanextensiveAfricanportfolioallowingittoweatherdownturnsinindividualcountries.196Thecompanyhasovercomethedifficultyofsuitablelocationsthroughthegroup’sownpropertydivisionthatresearches,identifiesandleasespremisesordevelopsnewshoppingcentrestoaccommodatethesupermarket.197

LocalrivalPicknPayhas100storesinAfrica;SparhasstoresinNamibia,Botswana,Mozambique,ZimbabweandSwaziland;andWoolworthsoperates59storesinBotswana,Namibia,Lesotho,Swaziland,Ghana,Kenya,Tanzania,Uganda,ZambiaandMozambique,withplanstoopenanadditional15storesby2017.198Thesegroupsareleasingpremisesandcitethelackofretailspaceasafactorinhibitinggrowth.199Massmart,whichoperatesin11sub-SaharancountriesincludingNigeria,TanzaniaandGhana,isplanningtoopentwostoresinAngolain2015andafurthertwoby2017.200ItwillalsobuilditsownstoreinKenya,havingbeenunabletoattainmarketsharethroughacquisitions,andislookingforopportunitiestoexpandtoSenegalandCameroon.201

Agro-processingFoodprocessingcompaniesdrivetheAfricanagro-foodsector202byturningprimaryagriculturalproductsintoconsumablecommodities.203InSouthAfrica,thesectorisdominatedbymultinationalcompanies—10%ofagro-processingcompaniesareresponsiblefor70%ofthesector’sturnover.204TigerBrands,involvedinmillingandprocessingofmaizeandwheat,holds50%ofmarketshare,205aswellas25%ofthebreadmarket.206

Ontherestofthecontinent,multinationalssuchasUnilever,Parmalat,Nestle,Danone,Cadbury,Syngenta,CloverandDangoteFlourMills(TigerBrandsholdsa63.35%shareholding)holdstrongmarketpositions.However,therearealsoAfricancompanieswithextensivereach,includingBIDCO(anedibleoilprocessingcompanyheadquarteredinKenya),EastAfricanBreweries,CheetahMalawi,(whichsellsprocessedindigenousspicesacrosseasternandsouthernAfrica),207TigerBrands,RainbowChickenandAstralFoods.

Thesectordisplaysvarieddegreesofconsolidation.Thetopfiveagro-processingcompaniesinSouthAfricaaccountfornearly40%oftheagro-foodrevenueofthecountry,whileinNigeria,thetopfiveaccountforonly11%.208Agro-processingisseenasavitalactivitytocounteractAfrica’sincreasingimportationofmajorcommodities—currentlythecontinentimports72%ofthese,includingitsstaplefoods.209

Rapidurbanisationrates(itisestimatedthatby2030Africa’stop18citieswillhaveacombinedspendingpowerofUS$1.3trillion210)drivemarketopportunitiesintheprocessingsector.Urbanisationistraditionallyaccompaniedbyanutritiontransition,whichreferstothechangeindietfromtraditionalfoodconsumption(dietsprimarilyderivedfromplant-basedfoodsources,lowinfatandhighinfibre)tomorewestern-styledietsthatareenergy-denseandlowinfibre.211Theurbandietencouragesanincreasedconsumptionofprocessedfoodswhich,inturn,impliesincreasedprofitmarginsforagro-processors.212

SouthAfricanprocessinggiantsaremakinginroadsintotheAfricanmarket.TigerBrandshascontrollingsharesinHacoinKenya;theChocolaterieConsiferieCamerounaiseinCameroon;DangoteFlourMillsandUACFoodsinNigeria;NationalFoodHoldingsinZimbabwe;EastAfricanTigerBrandsinEthiopia;andfullcontrolofDeliFoodsinNigeria.213Itsmajoritystake(63.35%)inDangoteFlourMillsgivesitsubstantialmarketshareintheconsolidatedNigerianflourmillingindustrywherejustthreeproducerscontrol80%ofthemarket.TigerBrandsalsoexportsitsproductsthroughoutthecontinent,214withadistributionnetworkthatspansmorethan22Africancountries.215Besidesthat,ithasa


substantialshareholding(41.92%)inanotherSouthAfrican‘giant’—theOceanaGroup.

OceanaGroupisSouthAfrica’slargestfishingcompanyandhassubstantialcoldstoragefacilitiesinSouthAfrica(110,000refrigeratingpalletpositionsforfishandfruit)216andNamibiawhereitalsohasalargestakeintheindustry.217Thegroup’sstatedpurposeis“tobeAfrica’smostefficientconverteroffishingrightsintovalue”.218AlthoughitcurrentlyhasfacilitiesinSouthAfricaandNamibiaonly,thegroupsellsitsproductsthrough23operatingsubsidiariesintotheAfricanmarket.219ThreemillionofitsLuckyStarmealsandabout1.4millionofitshorsemackerelmealsareconsumedeachdayinAfrica.220HorsemackerelissoldintoAngola,Cameroon,DemocraticRepublicofCongo,Mozambique,Namibia,ZambiaandZimbabwe.221Oceanaisontheacquisitionpathtobuyupfishingrightsandinmid-2014itacquiredconditionalapprovalfromSouthAfrican’sCompetitionTribunaltopurchaseFoodcorp’sfishingbusiness.222Foodcorp,SouthAfrica’sthirdlargestfoodproducer,isitselfawholly-ownedsubsidiaryofNewFoodHoldings(Pty)Ltd,whichiscontrolledbyCapitauInvestmentManagementLimited,whichiscontrolledbyRCLFoods.223

RCLFoodsencompassesRainbowChicken,TSB(oneofSouthAfrica’slargestsugarproducerswitha32%interestintheRoyalSwazilandSugarCorporation)andVectorLogisticsSolutions.224Itownsa25%shareinUnilever,225amultinationalconsumergoodscompanywithover400brands.RainbowChickenisSouthAfrica’slargestprocessorandmarketerofchicken;itbreedsandrearsitsownlivestockandownsfivefeedmills,sixprocessingplants,distributionandmarketingchannels.226OverfourmillionchickenpiecesaresoldinSouthAfricaeveryweek.227RCLhasenteredintojointventuresonthecontinenttoexpanditsmarkets.TheseventuresincludeZambeef’sbeefandchickenoperationsinZambia.228ZambeefalsohasoperationsinGhanaandNigeria229anditoperatesShoprite’sin-housebutcheriesinZambia,GhanaandNigeria.RCLFoodswillinvestinanewrearing,layingandhatchingoperationinZambiaoverthenextfewyears.230In2014,RCLFoodsacquireda49%stakeinBotswana’sbiggestcoldchaindistributionfirm,SennFoodLogistics,forclose

onR80million.231This,incombinationwithVectorLogistics’long-termplansforexpansionintootherAfricancountries,ensuresreliabledistributionchannelsforRCLFoodsandcapturesthelogistics,salesanddistributionmarketopportunitiesinthosecountries.232However,RainbowisnottheonlySouthAfricanpoultrycompanyinterestedinnewAfricanmarkets.

Astral,witha22%shareoftheSouthAfricanpoultrymarket,iscloseontheheelsofRainbowwithits23%share.233Itisanintegratedpoultryproducermanufacturinganimalfeeds,involvedinbroilergeneticsandtheproductionandsaleofday-oldchicks.234ThecompanyhasbeenoperatingapoultryfeedbusinessinZambiaforsomeyearsandinJune2010itopenedTigerChicks,anewstate-of-the-artbroilerbreedingfarmandhatchery,alsoinZambia.235Inaddition,AstralsupplieschicksandhatchingeggstoindependentoperationsinSwaziland,BotswanaandMozambique.236In2012,thecompanyopenedahatcheryinMozambique,acountrythatimportsmostofitspoultryrequirements,andisconsideringexpandingtheoperationtoincludebroilerproductionandslaughteringfacilities.237Inearly2014Astralenteredintoalong-termsupplyagreementwithQuantumFoods,forabout550,000broilersaweek.238QuantumfallswithinthePioneerFoodGroup.239

PioneerFoodshasprioritisedAfricaforgrowth,flaggingthecontinentas“asignificantopportunityforthegroupinthemediumterm”.240Pioneer’sAfricanoperationsspanBotswana,Namibia,ZambiaandUganda.241Inmid-2014BraitannounceditwaslookingforopportunitiesforitsPremierFoodstoexpandinthefast-movingconsumergoodsmarketintherestofAfrica,242whilebeer-brewinggiant,SouthAfricanBreweries(SAB),hasbeenoperatinginAfricaforyears.SABhasbusinessoperationsin15Africancountriesandastakein21othercountries,throughanalliancewithCastel,aFrench-ownedfirm.243Home-brewersandbootleggerssupplytwo-thirdsofallalcoholconsumedinAfrica244andSABispursuingthecaptureofthelower-incomeendofthebeermarketthroughmakingimitationsoflocalbeersthatarenotpreserved;theNigerianbrandiscalledShake-Shakeasthecartonhastobeshakenbeforedrinking


tomixthesediment.Thisbrandisnowsoldin11countries.245TheexpansionofSABMillerhasincreasedopportunitiesforlocalfarmerswhosupplythecassavaandsorghumforthecompany’seconomy-brandlagers.246

AFGRIhasanextensivefootprintbothgeographicallyandacrosstheagribusinessspectrum.IthasJohnDeeredealershipsandequipmentoutletsinZambia,Congo-BrazzavilleandGhana;grainprocurementandstoragefacilitiesinZimbabwe;financialservicecentresinZimbabweandUganda;anda51%ownershipofBnotHarelinNigeria,anagriculturalpharmaceuticalcompanythatalsodealsinanimalfeedsandday-oldchickhatcherysupplies.247

CompaniessuchasPioneerFoodsbenefitfromcheapimportsofsubstanceslikesugarintoSouthAfrica,butanincreaseinsugarpriceswillmeanreducingsugarcontentorswitchingtoartificialsweetenersinitsproductswhileSouthAfrica’ssugargiantsaretakingstrainandlookingtoAfricanoperationstoprovide

higherreturnsoninvestment.248TongaatHulettandIllovobothhavefarmingandagro-processingplantsinAfricancountries—thesetwocompaniesarediscussedinmoredetailonlateroninthepaper.

FarmingAfricanfarmland,historicallyignoredbyinvestmentfunds,isbecomingacorecommodityofinvestmentportfolios.Thisisstimulatedbytheemphasisonmorepredictablefarmingsystems—theuseoftechnology,biotechexpertise,geneticsandland-managementpractices—toincreaseyields.249Besidestheopportunitytogrowcommoditycropsforexport,Africa’srapidlyincreasingurbanpopulation(thepopulationof30Africancitiesisexpectedtodoubleby2050)250presentsexcitingopportunitiesforforeignandlocalfarmers,growersandretailerstorakeinprofits.

ExpansionbySouthAfricanfarmersintoAfricadeviatesfromthenorm.African

AgriSA facilitates South African farming expansion

AgriSA,aunionrepresenting70,000large-andsmall-scalefarmersinSouthAfrica,hasanAfricaPolicyCommitteethathelpstosecurefundingforSouthAfricanfarmerswantingtoextendtheirfarmingoperationstootherAfricancountries.254Theorganisationhasbeenapproachedinitsprivatecapacitybymorethan20Africancountries(includingCongo-Brazzaville,Senegal,Uganda,AngolaandLibya)255lookingtorecruitSouthAfricancommercialgrowers.256Currently,theorganisationisinvolvedintalkswithgovernmenttoworkoutasystemofprotectionforSouthAfricanfarmersoperatinginAfrica,giventheSouthAfricangovernment’sdecisionnottorenewexpiringbilateraltreaties.257ExistingAgriSA-initiatedassociationsinCongo-Brazzaville(theCongoFarmer’sUnion)andMozambique(AgriSAMoz)arepreparingfordiscussionstonegotiateagreementsthatwillhaveinternationalvalidityandstanding.258AgriSAhasformedAgriAllAfricatoexploreissuessuchastheseandthegroupisnegotiatingwithmajorinputsuppliersandorganisationsonthecontinent,suchastheNEPADBusinessFoundation.259ItisalsointheprocessofsettingupassociationsinZambia,theDRC,Malawi,Tanzania,GabonandAngola.260TheorganisationspecifiestheminimumconditionsthatcountriesneedtomeetbeforeAgriSA-affiliatedcommercialfarmerswillbeginoperations.Theseincludeagreementsonland-userights,leasingorfulltitle(landmustbefreeormadeavailableataminimumcost);farmersmustenjoytaxholidayswhileestablishingoperationsandreducedimportdutiesonfarminputsandequipment;protectivemeasuresforinvestments,incomeandpropertymustbeinplace;andtherepatriationofprofitsandthereasonableassuranceofsafety.261AllfarminginitiativesinwhichAgriSAhasplayedafacilitatingrolemustconformtocertainstandards.262Theinitiativemustarisefrom“broadnationalconsensusandageneralneedinthatcountry”;itmustbedriven“outsidetheparty-politicalarena”;andtheinvolvementofSouthAfricanfarmersinthehostmarketmaynotresultinunfaircompetitionforlocalproducersbut“shouldcontributemeasurablytothedevelopmentofnewmarkets”.263AgriSAisamemberoftheSouthernAfricanConfederationofAgriculturalUnions,alongwith17otherorganisationsin12Africancountries.264


countriesareactivelywooingthecountry’scommercialfarmersinattemptstoraisetheirownproductionlevels,whileSouthAfricanfarmersareacquiringandleasinglandinotherAfricancountriestocreateplatformsfromwhichtheycancompetemoreeffectivelyonlocalandglobalmarkets(particularlyagainstSouthAmericanrivals),251aswellaswantingtodiversifyfromtheunstablepoliticalandeconomicclimateinSouthAfrica.252Manyareaffectedbycommoditypricefluctuationsandfarmgateprices—whichescalatewithincreasesininputcosts(seed,water,fertiliser)andbusinesscosts(electricity,labour,otheroverheads).253

SouthAfricanfarmersproducegrapesinEgyptandareconsideringolivefarmingandprocessinginMoroccoandsugarandbananaoperationsinSudan,aswellassugaroperationsinMozambique.265ThemostpublicisedofthesedealswasthatbetweenAgriSAandtheCongolesegovernmentwhichledto15SouthAfricancommercialfarmers(partofagroupof70)settingoffin2010onanother‘greattrek’toreachthe80,000hectaresgrantedtothem—afurther10millionisavailable—inanarea50kmnorthofDolisieintheNiariProvinceofCongo-Brazzaville.ThedealwasuniqueinthatitwasbrokeredbetweentheCongolesegovernmentandafarmers’union—AgriSA.Congo-BrazzavillehadapproachedAgriSAin2009,lookingtorecruitcommercialfarmers.ThestructureddealisgovernedbyabilateralagreementbetweentheCongoleseandSouthAfricangovernments.ThefarmsintheCongoareseenasextensionsoftheSouthAfricanfarmersexistingbusinessoperationsintheirhomecountry.Thedealcomprisesa30-yearlease(withthepossibilityofextension),taxexemptionsonimports,afive-yeartaxholidayandtherepatriationofprofitstoanylocation.Intheeventofexpropriationofland,farmerswillbecompensatedforland,infrastructureandlossofproduction.Asingledry-landhectareintheCongocanyield10tonsofmaizeasopposedto3tonsinSouthAfrica.TheCongolesestate-ownedlandwasclassifiedasunder-utilisedandunoccupied,butlocalfarminggroupshaveindicatedthatitwasbeingusedbysubsistencefarmers.TheCongolesegovernmentseestheinitiativeasapotentialavenuetoreducethecountry’sdebtlevelsthroughreducedfood

importsandnewfoodexportsintotheregion.TheSouthAfricafarmerssaytheyaretheretodiversifytheirbusinesses;assistlocalfarmerstocommerciallydeveloptheirownland;andtransferskillsandtechnology.Itisimportanttonotethatthesegroupsareextendingtheirbusinessoperationsandnotrelocating.

ProcessinggiantsIllovo,TSBandTongaatHulettallproducesugarinBotswana,Mozambique,Namibia,SouthAfrica,SwazilandandZimbabwe,throughownershipofpreviouslystate-ownedestates,out-growerschemeslinkedtocoreestatesandmills,andcontractfarmers.266Tongaat-Hulett,whichproducesrefinedcarbohydrateproductsfromsugarandmaize,includinganimalfeed,isalsoAfrica’sbiggestproducerofstarchandglucose.267Thecompanyhasanextensivefootprint—morethan300,000hectaresofland—anditworksin27locationsinSouthAfrica,Botswana,Namibia,Swaziland,MozambiqueandZimbabwe.268ItsprimesugarestatesareinZimbabwe,MozambiqueandSwaziland,withpackinganddistributionoperationsinBotswanaandNamibia.269

IllovoSugarisAfrica’sbiggestsugarproducer,operatingfromsixAfricancountriesandproducingmorethantwomilliontonsofsugarannually.270Italsoproducesarangeofdownstreamproducts,includinghigh-qualityalcoholfordistillingpurposes.ThecompanyoperatesinZambia,Zimbabwe,Tanzania,Malawi,Swaziland,SouthAfricaandMozambique,271althoughitmustbenotedthatin1996itsoldoffmostofitsestatesinSouthAfricaduetothethreatoflandreform.Itbeganacquiringmajorityshareholdingsfrom1996onwardsinIllovoSugarMalawi,theonlysugarproducerinthecountry(76%);ZambiaSugar,theleadingsugarproducerinthecountry(82%);KilomberoTanzania(55%);UbomboSwaziland(60%);andMaragraMozambique(90%).272Besidesthemarketopportunitiesofferedbysugar-importingAfricancountries—Africa’ssugardemandisgrowingat3.6%annually273—thesecompaniesarewell-poisedtotakeadvantageofthegrowingdemandforethanolandrenewableelectricityintheSouthernAfricanDevelopmentCommunity(SADC)region.

Tongaat-Hulettidentifiesethanolproductionasincreasinglyimportanttoitsbusinessand


planstoconstructlarge-scaleelectricityplantsatitsSouthAfricanmillsin2014and2015,aswellasalarge-scalebio-ethanolplantatoneofmills.274AtitsMozambican,SouthAfricanandZimbabweanplantsthesugarmillsarealreadygeneratingelectricityandtheplantinZimbabweproducesethanol.275IllovoinvestedinproductionfacilitiesinTanzaniaandbeganmakingethanolfrommolassesin2013.ItisconsideringstartingfuelandpotableethanolproductioninZambiaandMalawi.276ThesugarmillinSwazilandproduceselectricityfrombagasseco-generationandsellsitintothenationalpowergrid.277Thecompanyalreadyproduces91%ofitsownenergyrequirementsfromrenewableresourcesandislookingatthepotentialofco-generatingelectricitytobesoldintotheSouthAfricannationalgrid.278

Inputs—with a focus on seedsLowagriculturalproductionlevelsinAfricaareblamedonthelackofimprovedseedandinputs(syntheticfertilisers,pesticidesandherbicides).Aspartofthe‘modernistparadigm’embodiedbyorganisationssuchastheAllianceforaGreenRevolutioninAfrica(AGRA,)thereisemphasisonincreasingthesupplyandqualityofinputstoAfricanfarmers.279TheWorldBank,forexample,claimsthatitisthelowuseofmoderninputsandagro-technologiesthatseverelyconstrainsthegrowthofcompetitiveagribusinessonthecontinent.280

Seedsarebigbusiness.TheglobalcommercialseedmarketwasestimatedtobeworthUS$45

billionin2012;in2014SouthAfrica’sshareisaboutUS$450millionandtheAfricanmarketisestimatedtobeworthUS$1.1billion—andthisisenoughseedtocultivateonlyonetenthofarableland.281Tencompaniescontrol75%oftheworld’scommercialseedmarket282283andthreeofthemdominate:Monsanto(23%ofmarketsharein2007),DuPont(15%ofmarketsharein2007)andSyngenta(9%ofmarketsharein2007).284Thesecompaniesarealsopesticideproducersthatfocusonthedevelopmentofproprietaryhybridandgeneticallymodifiedseed.285TheyareallmarketleadersontheAfricancontinent,togetherwithVilmorin,Technosem,Baddar,286asaretheincreasingchainsofsmall-scalesupplierssetupthroughtheAGRAinitiative,ProgrammeforAfrica’sSeedSystems(PASS).Theprogrammehasassisted80smalltomedium-sizedAfricancompaniestoproduce80,000tonsofcertifiedseedin2014.287

Maizeaccountsforaround50%ofcommercialseedsalesinAfrica,vegetablesforabout24%(mainlyimportedseed)andwheatforabout13%.288Maizeandwheatarestaplefoodcrops,aswellasbeingcommodityexportcrops.

MonsantooperatesinAlgeria,BurkinaFaso,Kenya,Malawi,Morocco,SouthAfricaandZimbabwe289andSyngentaplanstoexpandfurther,havingcommittedtobuildingaUS$1billionbusinessinAfricaby2022.290NotablepartnershipsforSyngentaincludecollaborationwithKilimoSalama,toofferinsurance,andUWEZO,atrainingprogrammeforsmallholdersinKenyaandtheAfricaAcademy,launchedin2013,whichprovideseducationforfarmingsystems.291ThereareplansforSyngentatoacquireMRISeedZambiaandMRIAgro,Zambia’sleadingdeveloper,produceranddistributorofwhitemaizeseed.292ThiscropiscriticaltoAfrica’sfuturefoodsecurityandthemarkethashighgrowthpotential.293Inaddition,thegermplasmlibraryattheTorreyMesaResearchInstitute(TMRI)containsoneofthemostcomprehensivecollectionsofAfrica’sdiversegeneticresources.294

In2012,SouthAfrica’sCompetitionAppealCourtapprovedthemergerofPannarwithPioneerHi-Bred(afullyownedsubsidiaryofDuPont)resultinginSouthAfrica’scommercialseedmarketbeingdominatedbytwoUnitedStates-basedcompanies(Pioneer


andMonsanto)affordingthemalmosttotalownershipofthegermplasmforthecountry’sstaplefoodcrops—whitemaizeandwheat.PioneerHi-Bred’spurchaseofPannar,SouthAfrica’sbiggestseedcompany,providesaccesstothecompany’suniquemaizegermplasmlibrarydevelopedoverthelast50yearsinAfricantestingconditions,aswellasaccesstoPioneer’sAfricannetwork.ThisisanexampleofinternationalagribusinessenteringthecontinentthroughmergersandacquisitionswithSouthAfricanagribusinessgiants.

PannarhasbeensellingseedsinandfromSouthAfricasince1958andwasthefirstprivatecompanytointroduceitsownmaizehybridsinthe1960s.TodayithascompaniesineightothercountriesandeightAfricanresearchandseed-conditioningstations—fiveinAfrica,twointheUnitedStatesandoneinArgentina.Pioneer-Pannaremploysover300peopleinAfricaandservicesmorethanhalfamillioncustomers.

Pannarconcentratesonmaize,wheat,sunflower,grainandforagesorghum,soybeansanddrybeans.Thedemandfor‘improved’maizeseedinAfricaisgrowingwith35millionhectaresavailableformaizeproduction.Accordingtothe2013DataBookofitsparentcompany,DuPont,acriticalelementofthegrowthstrategyisto“advanceourpenetrationinrapidlygrowingdevelopingmarkets”andacquiringPannarwasasignificantsteptowardsbringing“technologicalinnovationtoagricultureinAfrica”.295Thecompany’sshareholdershavebenefittedfromUS$1.3billiongeneratedincashflowandUS$2.7billionpaidoutindividendsandsharerepurchases.Inits2013lettertoshareholders,DuPontnotesthatAfrica’sgrowingpopulationoffers“abundantopportunitiesforsciencetomakeadifferenceinfeedingpeople”andthatitiswell-positionedto“providesolutionstothesechallenges”.

Seedoccupiesauniquepositionasthe“platformfortechno-economictransformation”ofagriculture,296andisperceivedastheidealvehicleforsellingproprietarygenetictraits,297thankstoitscaptivemarket(theworld’sfarmers)andanestablisheddistributionnetwork298.Theembeddedintellectualpropertyineachseedcanbechargedforrepeatedly,withoutre-investmentininitial

research,developmentandregulatorycosts.299Beyondthis,seedofferscorporationstheopportunitytocapturerevenuederivingfromcomplementarysalesofchemicalproducts.300

MostseedcurrentlyusedinAfricaissavedonfarmsorexchangedwithfamilyand/orcommunitymembers.Thisimpliestheexistenceofavastandrelativelyuntappedmarketforseed,inparticularforsalesofimprovedseed—i.e.hybridisedorgeneticallymodified(GM)seed—withthepromiseofhigheryields.Forexample,Tanzania’spotentialmarketformaizeseedis70,000metrictonsandonly7,500ofthisiscurrentlyhybridseed.301HybridisedandGMseedrequiresapackageofinputstorealiseitsyieldpotential.Thus,asthemarketforthesetypesofseedsgrows,sodoesthemarketforthemandatedinputs—fertiliser,herbicidesandpesticides.

Public-privatepartnershipsbetweenmultinationalseedcompaniesandAfricangovernmentsandregionalbodiesalsoenableaccesstolocalgermplasmandgeneticresources.Onceaccessed,whatoncewaspublicisprivatisedandprotectedthroughpatentingtoproducecorporateprofit.302Itisworthnotingthatcorporateseedcompaniesrequiregeneticrawmaterialtocreatepatentedseedandthesystemrequiresanannualinjectionof7%newgeneticmaterialeachyear.303

Support for Agribusiness Expansation in Africa

SouthAfricanagribusinessfacesthesamechallengesinAfricanmarketsaslocalenterprises.Theseincludepoorandfragmentedinfrastructure;304thelackofhumancapacity,particularlyforhigh-skilledwork;305cumbersomeandonerousregulations;securinglocalfinance;306andcomplexandoftenundocumentedlandtenuresystems.307/308TheWorldEconomicForum,theWorldBank,and


theAfricanDevelopmentBankhaveidentifiedthetopthreechallengestoconductingbusinessinAfricaasfinancing,corruptionandinfrastructurechallenges.309

However,SouthAfricanagribusinessisoftenatanadvantageoveritsAfricancounterparts.Ithascapacityintermsofexpertiseandleverageinthesector,310accesstocapitalandinfluence,accesstoorownershipofadvancedtechnology,theabilitytouseeconomiesofscaleandreceivesthebenefitofdirectandindirectsubsidies.ChallengestoandadvantagesheldbySouthAfrica’sagribusinessarediscussedfurtherbelow.

Infrastructure and incentives

ThelackofadequateInfrastructureisamajorimpedimenttothegrowthofagribusinessinAfrica.Infrastructureencompassesroads,railways,powerandcommunication,aswellassocialinfrastructure—watersupply,sanitation,sewagedisposal,educationandhealth.311Thecontinenthastheworld’slowestelectrificationrate(30.5%),verylowraildensity(lessthan3kmperthousandkms2)312andreliablepowersupplyisfrequentlyunavailable313—citizensin30ofthe47countriesfaceregularpoweroutagesandinterruptions.314Inaddition,thecontinenthasthehighesttransportcostsintheworld.HalfofallAfricanfarmerslivemorethanfivehoursawayfromamarket315andfewAfricancitizenslivewithin2kmofanall-weatherroad—about32%inKenya,31%inAngola,26%inMalawi,24%inTanzania,18%inMaliand10.5%inEthiopia.316Further,Africahasroadsurfacesononly152kmper1,000squarekm2ofland.317

SouthAfrica’s2011NationalDevelopmentPlan(NDP)highlightsthecontinent’s“massiveinfrastructuredeficit”asakeychallengeforAfrica.318BridgingthisgapwillcostaboutUS$93billionperyear,about40%ofwhichneedstobespentonthepowersector.319TigerBrandscitesthelackofinfrastructure,particularlyinenergy,waterandtransport,asachallengetoconductingbusinessinAfrica,320whileClovernotesthatlonger-termexpansionintotheregionwillrequirethecompanytoinvestindevelopingitsowninfrastructure.321ThelackofrefrigerationfacilitiesinmanycountriesposesaproblemtocompaniessuchasClover,RainbowandAstralthatworkwith

chilledandambientproducts.322Thelackofinfrastructurehasaknock-oneffectforfactorssuchasrents,whicharedeterminedbythehighcostofdevelopment.323WoolworthscloseditsthreepilotstoresinNigeriain2013duetohighrentalcosts,complexsupplychainissuesandinfrastructuraldifficulties,whichlimitedprofit.324Transportcostsareanothernegativefactor—theprofitmarginsmadebyAfrica’struckingcartelsareexceptionallyhigh,reaching160%inWestAfrica.325InCameroon,transportingcassavaovera130kmdistanceaccountsforupto35%ofthecostofthefinalproduct.326Inthemid-1990swhenRwandatackledthisthornyissueandreformeditstruckingrules,pricesfellby75%.327

TheabilitytoinvestininfrastructuredevelopmentisaprimeadvantageforSouthAfricanagribusiness,whetheritisinthehomeorhostcountry.Forexample,ShopritehasbuiltshoppingmallsandcentrestohouseitssupermarketsandisconcludingajointpropertydevelopmentventurewithStandardBankandtheResilientPropertyIncomeFundtofacilitatefurtherexpansion.328ResilienthasincreasedtoR1billionitscapitalallocationtodevelopingpropertiesinNigeriafortheventure;twopropertiesareunderdevelopmentandnegotiationsforafurthersixsitesareinthepipeline.329

Besidesdirectinvestment,corporateagribusinessbenefitsalsofromindirectsubsidisationarisingfromstateinfrastructuralspending.Agribusinessrequiresanenormousamountofinfrastructure;muchofthecostofthisisnotbornebythecompanyitselfbutratherbytaxpayersinthehostcountry.330 Africancountriesareatthestartofa20–30yearinfrastructureinvestmentcycleandhavecommittedbillionsofdollarstoimprovingthecontinent’sinfrastructure.331ThroughitsinvolvementintheAfricanUnionanditschairmanshipofthePresidentialInfrastructureChampioningInitiativewithintheNewPartnershipforAfrica’sDevelopment(NEPAD),SouthAfricacontributestoregionalintegrationstrategiesthatemphasiseinfrastructuredevelopment.332Governmentinvestmentincommunicationstechnology,includingsatellitesandinternetcapabilities,isanotherindirectsubsidythatfacilitatestheefficiencyofagribusinessandhenceitsprofitability.333


Governmentinvestmentinportsandairports,whichfacilitatethefasttransferofgoodsfromoneendoftheworldtotheother,isanotherformofindirectsubsidy.334Manyoftheitemsimportedfromoverseasaresubsidisedbytheirhomegovernment,whereasdomesticsubsidiesinmanydevelopingcountriesarerestrictedbyagreementswithinternationalbodies,suchastradetreatieswiththeWorldTradeOrganisation(WTO).335Theabilityofacompanytobuildregionaldistributionwarehousesandnetworkslowerstheamountofemployeesneeded,allowsthebusinesstobenefitfromregionaleconomiesofscale,336andthuslowerstransactioncosts.337Thisallowsittoovercomethestructuralchallengesfacedbysmallercompetitors.

InthecaseofagribusinessexpansionintoAfrica,severalincentivesareofferedtoforeigninvestors.Anincentivecanbedefinedasanymeasurableadvantagegivenbygovernmenttoaspecificenterpriseorindustry.338Inthiscase,preferentialtaxtreatmentgiventoforeigndirectinvestmentoverlocalinvestmentisanincentivescheme.Foreign-ownedagribusinessinAfricabenefitsfromtheseschemeswhichrangefromdirectincentives(provisionoflandandinfrastructure)toindirect(taxreductions,accelerateddepreciationallowances,taxholidays,andreducedimporttariffs).339Othernon-fiscalincentivesincludesubsidisedfinancing.340

Ghanaallowsforeigncompanies100%ownershipinlocalcompaniesalongwithcorporatetaxrebatesofupto75%,exemptionfromcustomsimportdutiesonplantandmachinery,initialcapitalallowancedepreciationof50%andfullrepatriationofearnings.Italsoallowsforeignownershipoflandthrough50-yearleaseagreementswithoptionstorenew.341Nigeriaoffersunrestrictedcapitalallowanceforagribusinessandguaranteesupto75%ofloanstakenfromlocalcommercialbanks,aswellastaxexemptionforfiveyearsandzerodutiesonagriculturalmachinery.342Zambiaallowstowaiveimportdutiesandvalue-addedtaxandpromisedtoinvestininfrastructure(roadsandpowergrids)ineffortstoattractSouthAfricanfarmers.343Tanzaniahassanctionedzero-ratingofcapitalgoodsandallinputs(fertilisers,pesticidesandherbicides),reducedimporttariffs,defermentofvalue-addedtaxpaymentsandvalue-addedtaxexemptionsonexports,togetherwithfacilitatedaccesstoland344with99-yearleaseagreements.345InMozambiqueagriculturalenterprisesarecurrentlytaxed10%onlyonincome(comparedwithastandardcompanyincometaxof32%)andthisissettodecreaseto2%in2015.346

Incentivesgivenonadiscretionarybasis(appliedonacase-by-casebasisasopposedtobeingbasedonastandard)createopportunitiesforcorruptionandrent-seekingbehaviourbypublicservantsandpoliticians,

EXAMPLES OF INFRASTRUCTURAL ADVANTAGES

• AVI:spentmorethanR500millionontwodeep-seatrawlersandafreezerfactoryshipforitsI&Jbrandin2013.356

• Rainbow:expandeditslocalwarehousingandmillingcapacitytocaterforexpandedAfricansalesin2013.357

• AFGRI:ownsandleasesstoragefacilitiesinGhana,ZambiaandZimbabwe,alongwithgrainbunkersinZambiaandCongo-Brazzaville.358

• Oceana:ownsandoperatesthroughasubsidiary,CCSLogistics,10publicrefrigeratedwarehousefacilitiesinSouthAfricaandNamibia,offeringatotalof110,000refrigeratedpalletpositions,aswellasfruithandling,blastfreezingandtransportservices.359

• TigerBrands:hasadistributionnetworkthatspans22Africancountries.360

• Clover:ownsoneofthelargestchilledandambientdistributionnetworksinSouthAfrica,361comprising13ownedandoperatedfactoriesand21distributioncentres.362


particularlyiftheprocessesandproceduresthroughwhichtheincentiveisgrantedarenottransparent.347Forexample,mostlanddealsinAfricainvolvenoorlowlandfeesandnegotiationstakeplacebetweenbeneficiariesandstateintermediaries,348whichcouldencouragethepoliticalelitetodispossesslocalsoftheirlandaswellascontributetorisinglandcosts.349Allowingrepatriationofprofitstothehomecountryand/orexemptionfromtaxationalongwithreducedimportandexporttariffsenablestheflowofmuch-neededcapitaloutofthehostcountry350andthiscanbedoneatveryshortnotice,whichcreatesvolatilityinthehomecountry’seconomy.351Also,arisingfromthemultinationalortransnationalcorporation’sabilitytotransferpricingwithinsubsidiariessothatthetruevalueofproductsenteringandleavingthecountryisnotrecordedaccurately,thehostcountrycanlosethetaxrevenue.352

Thereislittleevidencethattaxincentivesbenefitthehostcountrybuttheseareoftenusedasameanstoamelioratedisadvantageousbusinessconditionsordisablinggovernmentpolicies.353However,thispracticedoesnotnecessarilyincentivisehomecountrygovernmentstore-crafttheirpoliciesandprocedures354whichmayalsobenefitlocalbusinesses.Foreigninvestmentisdeterminedratheronfactorssuchasmarketsize,levelofprivatisation,availabilityofresourcesandeaseofdoingbusiness.355

Human resource issues

Thelackofhumancapacitytodriveeconomicgrowthandtransformationoftheindustrypresentsafurtherhindrancetocapital.FewerchildrengotoschoolinAfricathanonanyothercontinent;halfdonotevengotoprimaryschool363andofthosethatdo,onlyoneinthreeemergeswithbasicliteracyandnumeracyskills;364andofthosegoingtohighschool,only23%graduate.365Over90millionAfricanyouthsfighttofindjobsinthepoorlypaidinformalsector.366

Acountry’sGrossExpenditureonResearchandDevelopment(GERD)ispresentedasapercentageofitsGrossDomesticProduct(GDP).ThisisknownastheGERD/GDPratioandindicatestheamountthatacountry

spendsonresearchanddevelopment.367OnlythreeAfricancountries(Malawi,UgandaandSouthAfrica)spendmorethantheAfricanUniontargetof1%ofGDPonresearchanddevelopment(2010),368whiletheremainderspendlessthan0.48%.369Toalargeextent,mostresearchanddevelopmentisfundedbyinternationaldonorsandprivateforeignorlocalcompanies.370Thenumberofresearcherspermillionpeoplerangesfrom25inMozambique,UgandaandGhanato825inSouthAfrica.371Onaverage,thecontinenthasverylownumbersofMastersandDoctoralgraduates.AgriculturalresearchnolongerdominatestheresearchagendasofAfricancountries,whichfocusmoreonmedicineandrelatedfields,372whileAfrica’sshareofworldsciencecontinuestodecrease.373Africa’sInnovationOutlook,releasedin2010,notesthatthecontinentneedstoinvestsignificantlyindevelopinghumanresources,strengtheningscientificinstitutionsandfundingscience,technologyandengineering.374TheHumanCapitalStrategy(HCS)oftheAfricanDevelopmentBank,(AfDB),releasedin2014,aimstomakehigh-impactinvestmentsineducation,scienceandtechnologytoaddressthiscrisissituation.375TheBankwillsupportinvestmentsinskillsandtechnologyinnovation,socialentrepreneurshipandlendingoperations.376TheseinvestmentsaimtoensurethatAfrica’supcoming‘youthbulge’isanopportunityandnotathreat.377ThereportcitesthehighinvestmentmadebySoutheastAsiaascontributingtohighreturnsonhumanresourcesthathaveenableditsindustrialtransformation.378

ThesestatisticshaveimplicationsforthelevelofinnovationpossiblebylocalfirmsinAfricancountrieswherethelackoffunds,informationandqualifiedpeopledoesnotsupporthome-growninnovation.379Anadditionalbarriertodevelopmentismarketdominationbyestablishedenterprises.380The15thAnnualGlobalCEOSurveybyPricewaterhouseCoopersindicatedthattheshortageoftalentinAfricacurbedinnovationandstifledmarketopportunities.381Almosthalfofthoseinterviewedforthesurveysaidthatthecostofskilledtalentwasclimbinghigherthanexpectedandthatretainingskilledstaffwasachallenge.382


SouthAfricanagribusinessesbringwiththemhighlyskilledhumanresources,expertiseandexperience,skillsdescribedbyAFGRIaskeytosuccessfulexpansiononthecontinent383theequivalentofwhichareoftenunavailableinthehostcountry.Tongaat-Hulett,forexample,needsworkerswithhighlyspecialisedskillsforcane/sugarandmaize/starchagro-processingandhasinvestedintraininganddevelopmentprogrammes.384Illovoprovidesconsiderabletrainingtoindigenousgrowersinthecountriesinwhichitoperatestoovercometheskillsshortage.385Duringitsexpansionistdriveinthe1990sSABMillerusedskilledSouthAfricanmanagementteamstopenetrateAfricanmarkets,whileSanlamhaspurchasedstakesinexistingbusinessesandbuiltupthecapacityoflocalstaff.386

Integrated regional markets

Weakgovernance,bureaucracy,andonerousandsometimescontradictoryregulationsareoftencitedbycapitalasbarrierstogrowthoftheagribusinesssectorinAfrica.387SouthAfricancorporateagribusinessrequiresstandardisedextensivemarketstobenefitfromeconomiesofscale,whileAfricanfoodandagriculturalmarketsareextremelyfragmentedandofsub-optimalsizeforprivateinvestment.388Forexample,Shopritenotesthatintra-Africantradeischallengingdueto“tedioustradeagreementsandadministration-heavyimport/exportrequirements”.389ThecompanywithdrewfromEgyptin2006despitehavingplannedtoopen100storesthere,citingrestrictivetradepracticesforitsreversal.WoolworthsclosedshopinNigeriaduetothechallengingbusinessenvironmentthere.390Asfarasthesecompaniesareconcerned,inefficiencieswithincustomsagenciesandgovernmentdepartmentsinflictcostlytimedelayswhichimpactnegativelyoncostsandprofits.391

TheWorldBankrecommendsdeepenedmarketreformsofparastatalsandtradepolicies;movingtowardsarule-basedandpredictablepolicyenvironment;acceleratingtheintegrationofmarketsbyimplementingtradeliberalisationschemes,moderninformationandcommunicationtechnology;reducingtransactioncostsandguardingagainstfraudandcorruption.392Tothisextent,AFGRIactively

workswithandsupportseffortsbySADCandtheCommonMarketforEasternandSouthernAfrica(COMESA)tomaintainsustainableagriculturalenterprises.393

Ethiopia,forexample,hasputinplacethefast-trackedadministrationofforeigndirectinvestment—investorsneedtoestablishacompany,developabusinessplanandestablishtheyhavecapacity—then,withinaveryshortperiodoftime,landismadeavailable.394InitsfirstAfricanRetailDevelopmentIndexreport,A.T.KearneyrankedRwandafirstonitslistofdesirablecountriesinwhichtoconductbusiness(basedonitsbusiness-friendlyapproachandrecenteconomicreforms)andthenNigeria(basedonitsrapidurbanisation,youthfulpopulationandrisingmiddleclass).395

RegionaleconomiczonesandharmonisedregulatorysystemsareperceivedasonewayofnavigatingthecomplexitiesofdifferentAfricanmarkets.396COMESA,theEasternAfricanCommunity(EAC)andSADCarethreesuchorganisations.397TogethertheyhaveinitiatedtheTripartiteFreeTradeAreaagreementwhichspans26Africancountriesacrossthecontinent398andintegratesthesethreeregionaleconomiccommunities,aimingtoopenupnewdistributionchannels,addvaluetoprocesses,facilitatemanufacturingandenablebusinessestoachieveeconomiesofscale.399InWestAfricatheEconomicCommunityofWestAfricanStates(ECOWAS)drivesregionalharmonisationefforts.400

SouthAfricasupportsregionalintegrationattheSADC,SouthernAfricanCustomsUnion


andtheTripartiteFreeTradeArealevels.InSouthAfrica,ajointpartnershipbetweentheDepartmentofAgriculture,ForestryandFisheriesandSouthAfrica’sagribusinesssector(JADAFA)aimstopromoteagriculturaltradeandagro-industrialinvestmentpartnershipsinAfrica.410JADAFAprovidesinformationonagriculturalmarketstofacilitatethisandtoguideinvestmentandengagementwithstakeholdersintargetcountries.411Regionaleffortsaimedattheharmonisationoftradeandseedlaws,intellectualpropertyrightsandphytosanitaryregulationshavebeenineffectforthepasttwodecades,oftenwithoutparticipationfromcivilsocietyorganisationsinaffectedcountries.

Innovation and technology

Innovationisthecreationofaneworsignificantlyimprovedproductorprocess.412SouthAfrica’sNDPemphasisesthat“Innovationistheprimarydriveroftechnologicalgrowthanddriveshigherlivingstandards”.413TheWorldBankclaimsthatthegrowthofcompetitiveagribusinessinAfricaisseverelyconstrainedbytheminimaluseofmoderninputsandlimitedaccesstoimprovedtechnologies;itproposesthattheuptakeandmoreintensiveuseofimprovedseed,fertilisersandotherinputswouldaddresstheAfricanagriculturalperformancedeficit.414

Technologiesrelevanttoagribusiness,and

REGIONAL BODIES:

COMESA:isdevelopingaregionalagro-foodssectorstrategyforprocessedfoods;401itsSimplifiedCertificateofOriginallowssomeproductsexemption/sfromcomplexcertificationrules.402

ECOWAS:aimstopromoteeconomicintegrationacross15countriesbasedonavisionof“modernandsustainableagriculture,basedontheeffectivenessandefficiencyoffamilyfarmsandthroughthepromotionofagriculturalenterprisesthroughtheinvolvementoftheprivatesector”.403

SADC:itsfunctionistoco-ordinateandharmoniseagriculturalpoliciesandprogrammes.404

KEYAGRICULTURALINITIATIVES:[heading]

UnitedStatesFeedtheFutureprogramme:hungerandfoodsecurityinitiativethatworkswiththeprivatesectortofosterprivatesector-ledgrowthinemergingmarkets.405

AllianceforaGreenRevolutioninAfrica(AGRA):workstoboostfarmproductivityandincomeswithacorefocusontheharmonisationoflawsandpoliciesthatallowforacross-borderflowoftechnology.TheorganisationisprimarilyfundedbytheRockefellerFoundationandtheBillandMelindaGatesFoundation,bothofwhichhavelinkstobiotechnologyresearch;thelatterisashareholderinMonsanto.FormoreinformationonAGRA,refertothepublicationbytheAfricanCentreforBioSafety,(ACB):Giving with one hand and taking with two: A critique of Agra’s African Agriculture Status Report 2013.406

GrowAfrica:apartnershipplatformtoaccelerateinvestmentsinAfricanagriculture.

SouthernAgriculturalCorridorofTanzania:aimstobring350,000hectaresoffarmlandintocultivationwithsupportfromcompaniessuchasDuPont,Monsanto,SyngentaandGeneralMills.407

USAID’sTradeHubSouthernAfrica:aimstofacilitatestructuredtraderegimesandstrengthenregionalorganisations,suchastheSADCSeedTradeAssociation;theseedinformationplatformoftheSouthAfricanNationalSeedOrganisation(SANSOR);andtheRegionalMarketInformationPortal408oftheSouthernAfricanConfederationofAgriculturalUnions(SACAU).

TheEuropeanUnion-SADCInvestmentPromotionProgramme:emphasisesprivate-sectorinvolvement,includingformulationofpolicypositionswithinkeygrowthsectors.409


perceivedasinnovative,includehybridandGMseed(theinnovationbeingtheproprietaryknowledgeembeddedintheircore);advancesinwarehousing,packaginganddistributionchains;watermanagementtechniques;andinformationandcommunicationtechnology.Thisisnottosaythatthereisnofarm-andcommunity-levelinnovationtakingplaceintheAfricanagriculturalsector.Farmersthemselvesarenormallyinnovative;examplesincludeafarmer-designedhybridbeehive,athree-potcookingplatethatsavesfuelandamethodforgrowingfingermilletfromseedlings—allwinnersattheEastAfricanFarmerInnovationFairin2013.415

WhileearlytechnologiesprovidedSouthAfricanagribusinesseswithanadvantagewhenexpandingintoAfricanmarkets,newerinnovationsandaccesstosophisticatedtechnologiesoffertheadvantageofproductdifferentiation,increasedefficienciesandcostsavings.

SouthAfricanagribusinessesownandusearangeofsophisticatedtechnologies.Forexample,Cloverusesbactofugationtechnologytoextendtheshelflifeofitsfreshmilkto18days—theindustrystandardinSouthAfricais12days.416AVI’sadvancedprocessingofitswet-fishline(i.e.freshfish),commissionedin2013,allowsforimprovedyieldsandcostsavings.417Inaddition,Cloverownsandoperatestheonlyultra-high-temperature(UHT)processedcheeseproductionfacilityinSouthAfrica.418

Innovationwithinthepackagingindustryhasbecomeanimportantinputintermsofthedifferentiationofproducts.419Clover’snewshapetubforbutterisdesignedtobemoreattractiveontheshelfandhas,atthesametime,cutannualproductioncostsbyR1million,420whiletheshelflifeforitslong-lifemilkandTropikafruitjuiceblendshasbeenextended,421servingtoovercomethechallengesofrefrigerationinAfrica.ClaimsofsuccessfromTigerBrandsrestonthe“perpetualrenovationandinnovationofitsbrands”anditconstantlychangesitspackagingandmarketingtosuitindividualcountrymarkets.422PartoftheR567millioninvestedincapitalprojectsbyAVIin2013wasallocatedtoautomatedpackagingatoneofitsplants,inordertoincreaseefficiency.423Shoprite’ssuccessrestsinpartonitsautomatedsupplychainthatallowsfor

centralisedprocurement,whichreducescostsandimprovesservicelevels.424

AFGRI’sworld-classsiloinventorymanagementsystem,includingelectronicsilocertificates,isanexampleofinformationandcommunicationtechnologyaffordingagribusinessanadvantage.425Shoprite’spoint-of-saledevices(10,000ofthemthroughoutthecompany’schainonthecontinent)areusedinan“efficientconsumerresponse”paradigm.Thistechnologyallowssupermarketstoavoidwastageandminimisetheirrisk,aspurchasescanbetrackedandstockisorderedondemand.426ItalsoenablesShopriteautomaticallytoupdatepricesincountrieswithfluctuatinginflationrates,aswellasprovidingfinancialandticketingservicesatthecheck-outcounter.427

Pannar’sexpansionintothemarketalongwithMonsantoandSyngenta,alignedwithAGRA’spushtosetupdistributionchannelsfor“improved”hybridseed,hasimplicationsforAfrica’ssmall-scalefarmers.Whiletheuseofhybridseedcanleadtoimprovedyields,itdoessoonlyundercertainconditions—whenaccompaniedbyfertiliser,pesticideandirrigationuse.428Small-scalefarmersfrequentlycannotaffordmandatedinputsand,ifaccessingcredit,thepurchasethereofcanleadtoindebtedness.Inaddition,dependenceonasystemthatrequiresfarmerstopurchaseseedaneweachyear(hybridseedisdesignedforsingleuse)createsfurtherfinancialburdensforagriculturalists.429Besidesthefinancialimplications,thefarmingsysteminwhichtheseseedsproducebest(highuseofpesticides,fertilisersandwater)isnotconducivetomaintainingagriculturalbiodiversity.430


The potential impact on Africa’s agricultural value chain

ThissectionprovidesananalysisofsomeofthepotentialimpactsthatSouthAfricanagribusinessexpansioncouldhaveonthecontinent’sagriculturalvaluechain.

Market structure

Theentryofcapitalised,sophisticatedagribusinessintorelativelyunformedAfricanmarketswhereitenjoysacomparativeadvantage431canchangethestructureofthehostmarketineverything,fromsupplyanddistributionchainstoconsumptionpatterns.432Itscomparativeadvantagesrestonitssizeandbargainingpowerwhichcandeterminepricespaidtosuppliers,433itsabilitytonegotiatemorefavourabletaxconditions,anditscapacitytoharnesseconomiesofscaleacrossitsnetworktoreducetransaction,distributionandmarketingcosts.434Itssuperiorcompetence,knowledge,contactsandsupportservicescandampendomesticentrepreneurshipandcompetitivenessandhindertheemergenceofsmalleroperators.435Inmanycases,theentryoflargecorporatecompaniescanreinforceexistingdualisticeconomicstructuresandincreaseincomeinequalities—inparticularthedividebetweenruralandurbanopportunities—andcontributetotherateofurbanisation.436

Corporateprocessors,suppliersandretailersrequirecertainmarketconditionstoensureareturnoninvestment.Typically,theyneedacriticalmassofconsumers,favourabletaxconditions,infrastructure,accesstocredit,reliableenergysupplies,easeofcross-bordertransactionsandtechnicalexpertise.437Inshort,corporateagribusinessrequiresstandardisedandregulatedmarketsthatminimisecontingenciesandthereforerisk.And,inturn,thegreatertheregulatoryrequirementsareinanindustry,themoreconcentrateditisexpectedtobe,ascostsbecomelessprohibitive

whenspreadoverincreasedproductoutput.438Regulatoryrequirementsincludephytosanitarystandardsthatconformtointernationalregulationsandenabletheeasymovementofgoodsbetweendifferentmarkets.Thishasnegativeimplicationsforsmallerplayerswhocannotcomplywiththeburdenofrequirements439/440andwhoarewithoutthenecessarylevelofbusinesssophisticationandcapital.441

Asexamples,TigerBrandsandShopriteseemintentonpursuingconsolidationoftheirinterestsonthecontinent.TigerBrandscontrols50%oftheSouthAfricanmaizeandwheatmillingandprocessingmarket,togetherwith25%ofthebreadmarket.WithitscontrollingsharesinDangoteFlourMillsinNigeria,ithassubstantialmarketshareinanalreadyconsolidatedflourmillingindustry—Dangoteheld18%ofmarketsharein2008,FlourMillsofNigeria38%,andIdealGroup14%,withthebalancetakenupbymuchsmallerplayers.442Inaddition,TigerBrandshascontrollingsharesincompaniesoperatinginCameroon,Kenya,ZimbabweandEthiopiaandthegroup’sdistributionnetworkinAfricaspans22countries.ItalsohasacontrollingshareinOceana,anotheragribusinessgiantonthecontinent,whoseaimistobe“theleadingempoweredfishingandcommercialcoldstoragecompanyinAfrica”.Consolidationofpowerinagribusinesscanleaddirectlytoeconomiclossforbothsuppliersandconsumers,evidencedbyacalculablelossofincomewhenagribusinessisinapositiontoundermineitscompetitionandincreaseitsownprofitsattheexpenseofeithergroup.443Throughtheexerciseof‘buyerpower’corporateagribusinesscanimposeverticalrestraintsonsuppliers,suchasforcingthemnottoselltocompetitors,ornottosellatlowerprices.444Whencontrolofthefoodsystemshiftstothosewhocontrolsupplyanddistributionasopposedtoproduction,asmallnumberofbuyerscancontrolalargernumberofsellers(amarketformknownasoligopsony)minimisingtheirriskandmaximisingtheirprofit.

ShopritedominatesthesupermarketsceneinSouthAfricaandalreadyhasa34%marketshareinAfrica’ssupermarketsector,operatingin16Africancountries.ThecompanyacknowledgesthatinruralAfrica“theShoprite


storemaybetheonlystore,resultinginabinarydependencybycommunities”445Expansionofthe‘mega’intonewmarketstendstodisplacethesmallandvariedfarmersandsupplierswhotraditionallyoperateinthatspace.Forexample,by2002theformalsectorinSouthAfricahadovertakentheinformalsector—vendors,smallstandsandspazas(informalconveniencestoresinSouthAfrica).Althoughsupermarketsectorheldlessthan2%ofallfoodretailoutlets,itsshareoftotalfoodretailinSouthAfricawascloseto60%446andthisfigureincreasedto94.5%by2007.447The1,700-oddsupermarketsatthattimehadreplacedanequivalentof350,000spaza-typeshops.Smallshopsprovidemorejobspervolumethansupermarketsandemergingevidenceindicatesthatmegamarketsjettisonthreejobsforeverytwotheycreate.448

TheSouthAfricanDepartmentofAgriculture,ForestryandFisheriesnotesthatthepotentialtocreatesustainablejobsandinclusiveenterpriseswithinthesectorlieswiththesmallandmediummarket,asopposedtocorporationsthatcurrentlydominatethemarket.449Despitethisacknowledgementthough,SouthAfrica,throughthePIC,continuestosupport‘mega’agribusinessinthecountryandeffectivelyitsexpansionintothecontinent.Anothernegativeimpactisfeltbystreetvendorswhoprovideavitalstreamofincometomanyandafoodsecuritynetformanymore.InLagos,Nigeria,theurbanpoorspenduptohalftheirfoodbudgetsonstreetfoodandthroughoutAfricamorethan50%ofchildrenrelyonstreetfoodforalargeportionoftheirdailyintake.450Theseinformalvendors,aswellasstreetmarketsforfruit,vegetables,meatandpoultry,arevitalintheprovisionoffoodtotheurbanpoor.Itisatplaceslikethesethaturbandwellerscanbuyinindividual,muchsmalleramounts,accordingtowhattheycanafford(andmanyofthesesmallerstoresmayevenoffercredit).451Supermarketshavetheability“toraisesellingpricesanddepressinputprices,todeterentry,toredistributeprofittooneself,fromotherfirms,andmoreimportantlytosustainthesebenefitsovertime”.452Inaddition,beingthelinkbetweenconsumersandsuppliers,theretailerisinapowerfulpositiontoinfluencewhatwillbeconsumedandthepriceofthatconsumption.453

Inshort,increasingconsolidationoftheAfricanagribusinessmarketbycorporatecapitalislikelytoshutoutsmallerplayers,decreaseemploymentopportunitiesanddeterminethestructureofanyfuturesystem.

Food production

AsAfricaurbanisesandmillionsgothroughthenutritiontransition,movingfromstaplefoodssuchassorghum,milletandmaizetoanenergy-dense,high-fatandlow-fibreWestern-stylediet,454thetypeofprocessedfoodtheyeathashealthimplications.‘Cheap’andready-madefoodinthesupermarkets,whilecontributingtocalorificintake,oftencontainsmoreunhealthyfats,saltandsugaraswellasloweramountsoffibre,whichcancontributetochronicconditionssuchasobesity,heartdiseaseandstrokes.455Thesearenotconditionsthattheurbanpoorareinanyconditiontotacklefromaretroactiveperspective.Healthhasbeenpositionedasanindividualchoice,howevermarketing,misinformationandthemythofaWesternlifestylecombinetoshapeindividualfoodpreferences—andnowhereisthismoreapparentthaninamodernsupermarket.SouthAfricanagribusinesses,byduplicatinglocalpatternsofproduction,processing,distributionandretailonthecontinent,arearguablyalsoexportingacultureofnutritionalimbalance:obesityandmalnutrition.

ThereisnodoubtthatAfricanfarmersneedsupport.Forexample,poorpost-harveststorageaccountsfor40%loss;thisequates


toalossoffoodstaplesvaluedatUS$4billioneveryear.456In2012about18%ofAfrica’smaizeharvestwaslostpost-harvest.457Whatisdebatableishowthisshouldbedone.Thedrivetoincreaseyieldsinorderto“feedtheworld”,whichwasa“rallyingcryforexport-orientatedagriculturalpolicy”intheUnitedStatesinthe1970s,conflatedtheissuesoffoodsecurityandfoodproduction.458Itdidnotthen,anddoesnotnow,takeintoaccountthenegativeenvironmentalandsocialeffectsofhigh-yieldmodernfarming.Thepromotionofuniformity(intermsofcropsandfarmingpractices)acrossabroadspatialscalehasresultedinthehighuseofsyntheticagrichemicalinputsandrelianceonnon-renewableresources;459andincreasedgreenhousegasemissions,whichcontributetoclimatechangeandaradicaldecreaseinbiodiversity.460/461/462/463Climatechangeandbiodiversityhaveadirectbearingontheabilityofhouseholds,communitiesandcountriestoremainfoodsecure.Thosewholookforshort-termprofits,ortoexternalisetheirenvironmentalcost,maynotbetakingthesefactorsintoaccount.464

Thenarrativeonyieldincreasealsodoesnotconsiderthebroader,interlockingfactorsandconstraintsthataffectproductionability,465suchasaccesstoland,capital,information,marketsandwater.Africacannotincreasefoodproductionatthespeedandscalerequiredwithoutharnessingtheproductivepotentialofsmallholderagriculture.466Mostofthesearewomen,workingonplotsoftwohectaresorless.467Theopportunityistohelpthesefarmerscreateasurplus,addvaluetotheir

produceanddevelopasentrepreneurs.468TheInternationalFoodPolicyResearchInstitutefoundthatpromotingstaplefoodproductioncontributedmoretoeconomicgrowththanpromotingexportproduction,asstaplecropshaveamorecentralroleinthelivelihoodsofthepoor.469GiventhatfoodinsecurityinAfricarevolvesaroundproblemsofaccess(poverty)asopposedtoproduction,afocusonyieldsseemscounterintuitive.

Implications for Africa’s food sovereignty movement

TheaggressiveexpansionoforganisedagribusinessexpansionintoAfricahasimplicationsforthecontinent’snascentfoodsovereigntymovement.Foodsovereignty,asdefinedattheNyeleniDeclarationonFoodSovereigntyheldinMaliin2007,is“therightofpeopletohealthyandculturallyappropriatefoodproducedthroughecologicallysoundandsustainablemethodsandtheirrighttodefinetheirownfoodandagriculturesystems.”470Themovementisbuiltontheprinciplesofpeople-centredagrarianreform,ademocraticfoodsystem,seeingfoodasahumanright,agroecologicalproductionmethodsandsolidarityinproduction,redistribution,consumptionandstruggle.471Themovementmakesanessentialconnectionbetweenfoodsovereigntyandpoliticalsovereigntyandarguesagainstacapitalisteconomicsystem.472

Thefindingsofthispaperindicatethatcorporateagribusinessisexpandingrapidlyonthecontinentanditdoesthisthroughaccessingcapital,sophisticatedtechnologyandadvancedlogisticsinfrastructure,aswellasusingitshumanresourcesandmarketknowledgetogenerateanadvantageforitself.ItspresenceinAfricanmarketscanrapidlychangemarketstructurealltogetherandeliminatealternativeoptionsandblocktheemergenceoftheagriculturalsectordesiredbythefoodsovereigntymovement.

Themovementwoulddowelltoconsiderexpandingitsfocusbeyondprimaryproductionandtoengagemoreactivelywiththeentirefood-valuechainfrominputsthroughtoretailing.Inaddition,themovementcouldlookatspecificpointsofinterventionordemandtoensureaspaceforthefoodsovereigntyvision.Theseinclude:


• Demandingegalitarianfood-valuechains.• Demandingprotectionandsupportoflocal

markets.• Demandingsupportoflocalsystemsof

production,storageanddistribution.• Demandingthatgovernmentsgivestandard,

asopposedtodiscretionary,incentivestoagribusinesses,i.e.thatlocalbusinessreceivedthesameincentivestructureasforeigncapital.

• Demandingthatalltransactionsinvolvinglandaretransparentandthatinformationonthesetransactionsispubliclyadvertisedandtherebeingopportunitiesforpublicconsulationandengagement.

Local innovation

Africahopestobenefitfromtechnologytransferscomingfromforeigndirectinvestmentintheagribusinesssector.Transferoftechnologyisoftenusedasarationaleforencouragingforeigndirectinvestment;however,thewayinwhichtechnologyistransferredisasimportantasthetypeandamountoftechnologybroughtintothecountry.Itsuseandadaptationmustbeallowedtospilloverintolocalproduction,elseitremainsanincome-generatingtoolforthehomecountry.473Thisisparticularlyneededwherethehostcountryallowsrepatriationofprofitsand/ordoesnotimposedoubletaxation.Theimportationofpatentedtechnologycanresultinmarketdominancebytheforeignfirmtothefurtherdetrimentofsmall-scaleenterprises.474

SouthAfrica,arguablythecontinent’smostformalisedeconomy,itselfdisplayslowlevelsoflocalinnovationdespiteitshighinvestmentinresearchanddevelopmentandhigherlevelsofhumanresources.In2011thecountry’sDepartmentofAgriculture,ForestryandFisheriesnotedthatresearchinthepublicsectorhasincreasinglybecomeskewedtowardscommercialsectorinterests.475Thisisinlinewithglobaltrendstowardscommercialisingpublicresearch.476Ifcorporateandforeign-ownedagribusinesseffectivelydominatesamarketandsetsthepricesthiscouldhavenegativeeffectsontechnologyadoptionanddiffusion.477Intellectualpropertyrightsregimesalsoallowagatekeeperfunctiontothosewhoownkeytechnologies.478

Increasinguseoftechnologycanalsoleadtojoblossesonfarms;479thishasparticularlydireconsequencesforsub-SaharanAfricawhichemploysmostofitslabourforceinagriculture.DuPontspokesperson,PaulSchickler,commentedthatwhilethiscouldhappen,hewasconfidentthatawholenewsetofjobopportunitieswouldemerge,althoughadmittedlynotforunskilledlabour.480

Theemphasisontechnologytransferignoresthefactthatlocalinnovationislikelytodeclineinconsolidatedmarketscontrolledbymultinationalagribusiness.481Itismorelikelythatstrengthenedintellectualpropertyrightsandpatentinglawswillprotecttheprofitsofagribusinesscorporations—profitswhichcanbeexpropriatedbacktothehomecountry.TheWorldBank’sDevelopmentReportof2008notestheincreasinglycomplexnatureofagriculturaldevelopment,whichneedstoaddresssocial,environmentalandeconomicsustainability.482Italsostatesthattherelationshipbetweenscienceandsocietyneedstobequestioned—whodirectsthescientificagendaandwhobenefits?483Theabilitytoinnovateandexploittheresultsisincreasinglyamainsourceofcompetitiveadvantageamongknowledgeeconomiesofthedevelopedworld.484

Equity and rights

Economicgrowthdoesnotnecessarilyaddresssocialandstructuralinequities,whichareoftenignoredinthehypearoundthepotentialofagribusinessexpansion.485Africaistheworld’ssecond-mostinequitableregionintheworld,withaverageGinicoefficientscloseto0.45.486Publicdebthasincreasedacrossthesub-Saharanregionfrom29%ofGDPin2008to34%in2013.487CountriessuchasGhana,Malawi,ChadandCameroonareoperatingatseriousfiscaldeficits.488ThefactthatincreasingGDPlevelsinmanyAfricancountries(Ethiopia,Ghana,Nigeria,TanzaniaandZambia)isbeingdrivenbystateinfrastructuralspendingisoftenunder-ratedorignored.489/490Thesupposedbenefitsthataccruetocountriesthatopentheirdoorstoforeignagribusinessinvestmentmustbeseenagainstthebackdropofadrivetocreateuniform,low-riskmarketsthatallowcapitaltogainagoodreturnoninvestment.Itisdifficultforstatestoprotestretroactively


theunkeptpromisesofjobopportunities,skillstransferorinfrastructuredevelopment,491particularlyiftheprofitsandinvestmentfundscaneasilyberepatriatedelsewhere,492whichhasthepotentialtocausevolatilityinthehostcountry’seconomy.493

TherewillbenoshiftinAfrica’sdepressingdemographicsunlessgrowthisaccompaniedbyequitableredistribution,494butthemodernnarrativeisfocusedon“biotechnology,syntheticfertilisersanddebt-drivencommercialisation”,whichalsocontradictstheagro-ecologicalapproachesputforwardbyfarmer-basedfoodsovereigntymovements.495

Thereareseveralconcernsaroundharmonisationofregionalregulationsrelatedtoagribusiness.TheAllianceforFoodSovereigntyinAfrica(ASFA)hassuggestedthatAfricangovernmentsare“beingco-optedenmasseintorestructuringtheirseedlawsandsupportingtheimplementationofplantvarietyprotection(PVP)lawsthroughfast-trackedregionalharmonisationprocessesandtradingblocs”.496CommentingontheSADC’sDraftPVPProtocol,theorganisationnotesthatwhiletheprotocolprovidessecuremarketsforprivateinvestment,especiallytheprotectionofprivateownershipoverseedintheformofintellectualpropertyrights,itunderminestherightsoffarmersandmostlikelywillincreaseseedimports,facilitatethemonopolisationoflocalsystemsbyforeigncompaniesanddisrupttraditionalfarmingsystemsonwhichmillionsofAfricansdependforsurvival.497Inaddition,itwouldencourageindustrialplant

breedingthatfeedsintoindustrialisedfarmingmodels,knowntohavenegativesocialandenvironmentalimplications.498Thelackofpublicparticipationindeliberationsonregionalharmonisationmeansthatthevoicesofthoselikelytobemostaffectedhavenotbeenheard.

Conclusion

SouthAfricanagribusinessgiantsareinvestinginAfricawhileescapingfromsaturatedandhighlyregulatedhomemarkets;adepressedlocaleconomy;thestrainofdecreasedconsumerspending;uneasinessaboutlandredistribution;highlevelsofcrime;increasingcostsofproduction,fromlabourtoinputs;andaretargetingAfrica’sburgeoningmiddleclass,withitsrisinglevelsofdisposableincome,tomakehighreturnsontheircorporteinvestments.

Expansionintothecontinentvariesintypeandsizewithsomecompaniesdevelopingtheirowninfrastructure(Shoprite)andsomeleasing(WoolworthsandPicknPay);someenterthroughmergersandacquisitions(TigerBrands),somethroughcontractfarming(IllovoandTongaatHulett),andothersthroughjointventures(RCL).However,SouthAfrica’stopagribusinesses,includingthecountry’sretailgiants,arealllookingtoAfricanmarketsforfuturegrowth.

Theyfacechallengesrelatedtoinfrastructure,regulationsandgovernance,andthelackofskilledhumanresources,butareabletoovercomeorminimisethesetrialsthroughaccesstocapitalandextensiveandsophisticatedtechnologyandlogisticsnetworks.Inaddition,theybenefitfromthedirectandindirectincentivesofferedtoforeignagribusinesses,includingtaxincentivesandtherepatriationofprofitandstatespendingoninfrastructuredevelopment.

ThereareimplicationsfortheexpansionofSouthAfricanagribusinessintothecontinent.OrganisationscouldreplicatethesamepatternsofconsolidationappliedintheSouthAfricanmarket,effectivelyexcludingthepossibleemergenceofastrongsmall-


scalesector(farming,processing,retailing).Inaddition,corporateagribusinessdemandsuniformity,volumeandquality-assuredproductsforprocessingandretailingwhich,inturn,demandsaparticularfarmingmodel.Itrequiresindustrial-stylefarmingwithmoderninputs—hybridseed,highfertiliserandpesticideuseandregularirrigation.Thisapproachhasbothsocialandenvironmentalimplications.Itwillimpactnegativelyonsmall-scalefarmers,retailersandsuppliersunabletocompete,informalnetworksoffoodvendorsandspaza-styleshops,andthosereliantoncommunallandsfortheirfoodsecurity,aswellasbiodiversityloss,soildegradationandwaterscarcity.Thesefactorsplayaroleindeterminingfoodsecurityandnutritionlevels.Bygainingmarketadvantagethroughtheuseofsophisticatedtechnology,regionaldistributioncentresandlogisticschains,thereisariskthatSouthAfricanagribusinessinAfricawillimpedelocalinnovationandentrepreneurship.

Expansionisframedwithinaparticular‘modernity’narrativethatispromotedthroughinternational,regionalandnationalinstitutionalframeworks.ThelikelihoodthatSouthAfricawillexportitsownconstrictedandconsolidatedagribusinessprofileintoAfrica,replicatingtheinequitiesandchallengesforsmall-scaleproducersithascreatedbackhome,posesathreattotheagriculturalwellbeingofthecontinent.


Appendix 1: South Africa’s leading expansionist agribusinesses

Company Description of activities Major shareholders (>2%)

Profit (Africa)

TigerFoods Milling,baking,cereals,consumerbrands

BesidesSouthAfrica,thegroupownsorhascontrollingsharesinbusinessesinChile,Cameroon,Nigeria,Ethiopia,Kenya,ZimbabweandNigeria.

PublicInvestmentCorporation,ColonialFirstStateGlobalAssetManagement,J.P.MorganAssetManagement,TigerConsumerBrandsLtd,LazardAssetManagementLLCGroup,TigerBrandsFoundationSPV,TigerBrandsBlackManTrust,BlackRockInc.,InvestecAssetManagement,CoronationAssetManagement,VanguardGroup.

Incomefromtheirnon-SouthAfricaentitiesincreasedby25%toreach744million—6%ofthetotalturnoverofR11,204millionfortheyearending31March2014.

PioneerFoodsGroup

Produceranddistributoroffood,beveragesandrelatedproducts—includinganimalfeeds—throughtheSasko,BokomoandCeresBeveragesdivision.

Botswana,Namibia,UgandaandZambia.

AgriVoedselBeleggingsLtd,PublicInvestmentCorporateLtd,PioneerFoodsBroad-basedBEETrust,ThembekaCapital,CoronationAssetManagement,CoronationLifeAssuranceCo.Ltd,MMIHoldings.

Turnoverfromnon-SouthAfricaninvestmentsincreased6.7%from2012to2013,toreachR1,137million.499

RainbowChicken(RCLFoods)

Breeder,processorandmarketerofchicken.

IsasubsidiaryofRCLFoods,whichalsoownsFoodcorpandVector(logistics)andhasjointventuresinZambiaforbeefandchickenoperations.

RemgroLimited(69.7%),BEEshareholdersandgeneralpublic.

FiguresfromtheZambianoperationswillbeincludedinthe2014annualreport.



Profit (Africa)

AFGRI Grainmanagement,retailandequipmentsales,financialandinsuranceservices,poultrydivision,crushingandoilextraction,animalfeed.

Zambia,Ghana,Congo-Brazzaville,UgandaandNigeria.

AgriGroupeInvestments(60%),PublicInvestmentCorporation,BafepiAgri(Pty)LtdandAFGRImanagement.Canadian-basedFairfaxFinancialHoldingsisthemajorshareholdinginAgriGroupeInvestments.

TheAfricandivision’sinputtoprofitsarenotdisaggregated;however,tractorsalesinAfricaincreasedby50%in2013,totallingR401million;andthefinancialservicesdivisionindicatedaR7millionprofitfromloansintoAfricanoperations.

CloverHoldings Producesdairyandnon-dairybeverages;distributeschilledandambientconsumergoods;salesandmerchandisingofconsumergoods.

CloverMilkProducersTrust,PublicInvestmentCorporation,CoronationFundManagers,Investec,Vorster,J.H.,AllanGrayInvestments,Sanlam.

Cannotbedisaggregated.

OceanaGroup Fishingandcommercialcoldstorage.

OperationsinSouthAfricaandNamibia;distributesintoBotswana,Lesotho,Swaziland,Zimbabwe,Malawi,Angola,Mauritius,Nigeria,Cameroon,DemocraticRepublicoftheCongoandNigeria.

TigerBrandsLimited,BrimstoneInvestmentCorporationLtd,KhulaTrust—Oceana’sblackemployeesharetrust.

In2014thegroupalsoacquiredLusitaniaandthefishingrightsofFoodcorp.

Accordingtothe2013annualreport,salesintotheSADCregionhavedoubledandtheAfricanmarketcontributes20%oftheR4,997millionrevenuein2013.

AnglovaalIndustries(AVI)

Hasabrandportfoliocomprising33ownedbrandsand20internationalbrandsunderlicence.BrandsincludeI&JfishandFiveRosesTea.

AffiliatesinBotswana,ZambiaandNamibiaandthird-partydistributionnetworksintootherAfricancountries.

PublicInvestmentCorporation,AVIBlackStaffEmpowermentScheme,AVIInvestmentServices

In2013,revenuefromsalesinAfricancountriesincreasedby14.7%toR639.4millionduetogrowthintheMozambique,Zambia,Angola,BotswanaandNamibiamarkets.

IllovoSugar Producerofsugaranddownstreamproducts.

Zimbabwe,Zambia,Swaziland,Mauritius,TanzaniaandMalawi.

ABFOverseasLimited,AllanGrayLimited,PublicInvestmentCorporation.

IllovomadeR1.89billionprofitin2013withMalawiandZambiacontributing70%ofthat.500



Profit (Africa)

AstralFoods Poultryproducerinvolvedinbroilergenetics,animalfeeds,saleofday-oldchicks,integratedbreederandbroilerproductionoperator.

Mozambique,Zambia,Swaziland.

PublicInvestmentCorporation,InvestecOpportunityFund,FidelityDevonshireTrust,AllanGrayInvestmentCouncil,AstralOperationsLtd,PrudentialPortfolioManagement,InvestecAssetManagement,SanlamInvestmentManagement,ColonialFirstStateGlobalAssetManagement.

In2013,nearlyaquarterofitsR44,944millionprofitcamefromAfricanoperationsandsales.

TongaatHulett Agricultureandagri-processingbusinessfocusingonsugarcaneandmaize.Propertydevelopment

Botswana,Namibia,Swaziland,MozambiqueandZimbabwe.

PublicInvestmentCorporation,BEE-THInfrastructureSPV,AllanGrayInvestments,BEE-yoMobaSPV,InvestmentSolutions,CoronationFundManagers.

In2014,operatingprofitfromtheSwazilandoperationwasR70million,Mozambique,R168millionandZimbabweR330millionoutofR1,061billionoverall.

Source:Unlessotherwiseindicated,allinformationhasbeensourcedfromthecompanywebsiteandlatestavailableannualreport.


Appendix 2: Africa’s top 20 agribusiness companies

Rank Name Country Turnover (US$bn) Activities Employees

1. TigerBrands SouthAfrica 2.8 Manufactures,processesanddistributesfoodproducts,whichincludemillingandbaking,confectioneries,generalfoods,edibleoilsandderivatives.

14,000+

2. PioneerFoodsGroup

SouthAfrica 2.2 Manufacturesawiderangeofcerealsandjuiceproducts.

11,000+

3. Cévital Algeria 1.8 Manufacturessugar,margarineandvegetableoil;andmanagessupermarketsandfranchises.

12,500

4. Tongaat-Hulett

SouthAfrica 1.5 Producesfoodproductsfromsugarcane,rawsugarmillingandrefining,andspecialtystarchesandsweeteners;bio-fuelproductionandelectricityco-generation.

42,000

5. AstralFoods SouthAfrica 1.2 Producesanimalfeeds,animalfeedpre-mixes,broilerchickgeneticbreeding,andbroilerchickoperations.

7,700+

6. AFGRI SouthAfrica 1.2 Handles,storesandmarketsgrainandlivestock;financesgrainforadiversecustomerbase;processesagriculturalproductsintoanimalfeedandotherendproducts.

4,000+

7. FlourMillsNigeria

Nigeria 1.2 Producesarangeoffloursusedinmanufactureofcakes,biscuits,pastaandbread;producesfertiliser,andsellsbaggedcementthroughwholly-ownedsubsidiaries.

5,000+

8. IllovoSugar SouthAfrica 1.1 Operatesinallareasofsugarproduction,fromgrowingsugarcanetomilling,refiningandpackagingsugar;manufacturesdownstreamby-products.

5,500+

9. AnglovaalIndustries

SouthAfrica 1.0 Manufactures,processes,marketsanddistributesbrandedconsumerproductsinthefood,beverageandfashioncategories.

7,900+


Rank Name Country Turnover (US$bn) Activities Employees

10. RainbowChicken

SouthAfrica 0.9 Operatesintegratedfarmingfacilitiesthatproduce,processandmarketbroilerchickensunderthe“Rainbow,”“FarmerBrown”and“BonnyBird”labels;producesanimalfeedthroughEpol(Pty)Limited.

–

11. CloverHoldings

SouthAfrica 0.8 Dairyproductprocessing,manufacturingandmarketing.

6,500+

12. EgyptianSugarandIntegratedIndustries

Egypt 0.8 Producesandmanufacturessugarandsweeteners.

–

13. CentraleLaitière

Morocco 0.7 Producesdairyproducts,inparticularpasteurisedandsterilisedmilk,yoghurtsandbutter.

–

14. CompagnieSucrièreMarocainedeRaffinage

Morocco 0.7 Produces,packages,andmarketssugar.

–

15. CargillCôted’Ivoire

Côted’Ivoire 0.7 Producescocoaproductsincludingcocoaliquor,butter,cakeandpowder.

–

16. SIFCA(Groupe)

Côted’Ivoire 0.6 Cultivates,processesandmarketsvegetableoil,naturalrubberandcanesugar.

25,000+

17. DangoteSugarRefinery

Nigeria 0.5 Produces,refines,packages,andsellsgranulatedrawwhitesugardomesticallyandregionallyinAfrica.

–

18. LesieurCristal Morocco 0.5 Producesvegetableoils,soapproductsandlivestockfeed.

–

19. NestleNigeria

Nigeria 0.5 Manufactures,marketsanddistributesfoodproducts.

–

20. OceanaGroup

SouthAfrica 0.5 Interestsinfishing,coldstorageandshipping.

2,000+


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17 Mellon,M.(2013).Let’s Drop “Feed the World”: A plea to move beyond an unhelpful phrase.UnionofConcernedScientists.[Online]..http://blog.ucsusa.org/lets-drop-feed-the-world-a-plea-to-move-beyond-an-unhelpful-phrase-229.Accessedon10October2013.

18 Ibid.19 Max-Neef,M.A.(2004).Foundationsof

Transdisciplinary,preparedforpublicationinaforthcomingeditionofEcological Economics.

20 Bawden,R.(2004).Chp3:TheCommunityChallenge:TheLearningResponseinMulti-partyCollaborationasSocialLearningforInterdependence:DevelopingRelationalKnowingforSustainableNaturalResourceManagement.Journal of Community & Applied Social Psychology 14:137-153.

21 Gonzalez,C.(2012).Theglobalfoodsystem,environmentalprotection,andhumanrights. Natural Resources & Environment26(3):7.

22 Mhlanga,N.(2010).Privatesectoragribusinessinvestmentinsub-SaharanAfrica.Rome:FoodandAgricultureOrganisation:RuralInfrastructureandAgro-IndustriesDivision.

23 UniversityofPretoria.(n.d.).Agribusinessmanagement.[Online].Availableat:http://web.up.ac.za/default.asp?ipkCategoryID=16723.Accessedon20May2014.

24 Deloitte.(n.d.).DeloitteAfricaAgribusinessUnit(DAAU):GrowandProsper.[Online].Availableat:http://www.deloitte.com/assets/Dcom-SouthAfrica/Local%20Assets/Documents/Deloitte%20AgriBusiness.pdf.Accessed14May2014.

25 Hawkins,D.(2010).ThebackboneofAfricanagricultureneedsstrengthening.[Online]..Availableat:http://www.hardmanandco.com/team/blog/2013/september/backbone-african-agriculture-needs-strengthening.Accessedon5June2014.

26 Sharife,K.(2010).SouthAfrica-Congo‘landgrab’:Exploitationorsalvation?Mail & Guardian.

27 Hawkins,D.(2010).ThebackboneofAfricanagricultureneedsstrengthening.[Online].Availableat:http://www.hardmanandco.com/team/blog/2013/september/backbone-african-agriculture-needs-strengthening.Accessedon5June2014.


29 WorldBank.(2013).GrowingAfrica:unlockingthepotentialofagribusiness.[Online].Availableat:http://www.thetradebeat.com/news-announcements/growing-africa-unlocking-the-potential-of-agribusiness.Accessedon10June2014.

30 Ibid.31 UNDP.(2012).Therolesandopportunitiesforthe

privatesectorinAfrica’sagro-foodindustry.UNDPAfricanFacilityforinclusivemarkets.[Online].Availableat:www.undp.org/africa/privatesector.


Accessedon16June2014.32 WorldBank.(2013).GrowingAfrica:unlockingthe

potentialofagribusiness.[Online].Availableat:http://www.thetradebeat.com/news-announcements/growing-africa-unlocking-the-potential-of-agribusiness.Accessedon10June2014.

33 VonBraun,J.&Meinzen-Dick,R.(2009).“LandGrabbing”byForeignInvestorsinDevelopingCountries:RisksandOpportunities.IFPRIPolicyBrief13–April2009.

34 Green,A.R.(2012).Africa:GrowingAfrica’sLand.[Online].Availableat:http://allafrica.com/stories/201207030260.html.Accessedon4June2014.

35 Kim,R.Larsen,K.&Theus,F.(2009).Introductionandmainmessages.InAgribusinessandInnovationSystemsinAfrica.Eds:K.Larsen,Kim.R.&F.Theus(EDS).WashingtonDC:WorldBank.

36 ACB.(2014).CAADPandtheG8NewAllianceonFoodSecurityandNutrition(NAFSN):seed,soilfertilityandecologicalagricultureopportunitiesandthreats.ACB discussion document, draft 25 June 2014. Johannesburg:AfricanCentreforBiosafety.


privatesectorinAfrica’sagro-foodindustry.UNDPAfricanFacilityforinclusivemarkets.[Online].Availableat:www.undp.org/africa/privatesector.Accessedon16June2014.

39 Ibid.40 Hanna,S.(2013).SAagribusinessescontinuetolookto

Africafornewmarkets.[Online].Availableat:http://www.africanbusinessreview.co.za/business_leaders/-sa-agribusinesses-continue-to-look-to-africa-for-new-markets.Accessed19May2014.

41 UNDP(2012)TherolesandopportunitiesfortheprivatesectorinAfrica’sagro-foodindustry.UNDPAfricanFacilityforinclusivemarkets.[Online].Availableat:www.undp.org/africa/privatesector.Accessedon16June2014.

42 Thomas,S.(2012).Shoprite’sAfricanexpansion.[Online].Availableat:http://www.financialmail.co.za/business/2012/12/24/shoprite-s-african-expansion.Accessedon19May2014.

43 Ibid.44 WorldBank.(2013).GrowingAfrica:Unlockingthe

potentialofAgribusiness.NewYork:WorldBank.45 Ibid.46 UNDP.(2012).Therolesandopportunitiesforthe


47 AfricaProgressPanel.(2014).GrainFishMoney:FinancingAfrica’sGreenandBlueRevolutions.AfricaProgressReport2014.

48 UNDP.(2012).TherolesandopportunitiesfortheprivatesectorinAfrica’sagro-foodindustry.UNDPAfricanFacilityforinclusivemarkets.[Online].Availableat:www.undp.org/africa/privatesector.Accessedon16June2014.


50 Deloitte&Touche(2012)DeloitteonAfrica:Therise

andriseoftheAfricanmiddleclass.[Online]Availableat:http://www.deloitte.com/assets/Dcom-India/Local%20Assets/Documents/Africa/Deloitte_on_Africa-%281%29_rise_and_rise.pdf.Accessedon12August.


52 IGD(n.d.).IGDAGINVEST:catalysingagribusinessinvestmentsinAfrica.[Online].Availableat:http://www.google.co.za/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=0CB0QFjAA&url=http%3A%2F%2Fwww.igdleaders.org%2Finsight%2Figd-aginvest-catalyzing-agribusiness-investments-in-africa%2F&ei=WSLqU9TpOYWm0QWg24HIBQ&usg=AFQjCNH9kAQwC2GL2Ymg6em4ci6w8MTGhA&bvm=bv.72676100,d.d2k.Accessedon15July2014.

53 Ibid.54 Mhlanga,N.(2010).Privatesectoragribusiness

investmentinsub-SaharanAfrica.Rome:FoodandAgricultureOrganisation:RuralInfrastructureandAgro-IndustriesDivision.

55 Hall,R.(2011).ThenextGreatTrek?SouthAfricancommercialfarmersmovenorth.PaperpresentedattheInternationalConferenceonGlobalLandGrabbing(6–8April2011).

56 Hall,R.(n.d.).(2013).Exportingdualism?TheExpansionofSouthAfricancapitalinAfricanfarmlanddeals.Belville,WesternCape:InstituteforPoverty,LandandAgrarianStudies.



59 Sharife,K.(2010)SouthAfrica-Congo‘landgrab’:Exploitationorsalvation?Mail & Guardian.



62 Ibid.63 VonBraun,J.&Meinzen-Dick,R.(2009).“Land

Grabbing”byForeignInvestorsinDevelopingCountries:RisksandOpportunities.IFPRIPolicyBrief13–April2009.

64 Ibid.65 Ibid.66 Ibid.67 Hawkins,D.(2010).ThebackboneofAfrican

agricultureneedsstrengthening.[Online].Availableat:http://www.hardmanandco.com/team/blog/2013/september/backbone-african-agriculture-needs-strengthening.Accessedon5June2014.

68 Ibid.69 Ibid.70 Green,A.R.(2012).Africa:GrowingAfrica’sLand.

[Online].Availableat:http://allafrica.com/stories/201207030260.html.Accessedon4June2014.

71 VonBraun,J.&Meinzen-Dick,R.(2009).“Land





74 Ibid.75 Green,A.R.(2012).Africa:GrowingAfrica’sLand.


76 ACB.(2014).CAADPandtheG8NewAllianceonFoodSecurityandNutrition(NAFSN):seed,soilfertilityandecologicalagricultureopportunitiesandthreats.ACB discussion document, draft 25 June 2014.Johannesburg:AfricanCentreforBiosafety.

77 KPMG.(2014).WaterscarcityinAfricashouldgetmoreairtimeonGovernmentandbusinessagendas.[Online].Availableat:http://www.kpmg.com/za/en/issuesandinsights/articlespublications/press-releases/pages/water-scarcity-in-africa.aspx.Accessedon30June2014.

78 Ibid.79 Ibid.80 UNEP.(n.d.).Improvingthequantity,qualityand

useofAfrica’swater.[Online].Availableat:https://na.unep.net/atlas/africaWater/downloads/chapters/africa_water_atlas_123-174.pdf.Accessedon29June2014.

81 AfricaProgressPanel(2014)GrainFishMoney:FinancingAfrica’sGreenandBlueRevolutions.AfricaProgressReport2014.

82 Ibid.83 Ibid.84 Ibid.85 Green,A.R.(2012).Africa:GrowingAfrica’sLand.


86 Ibid.87 Ibid.88 VonBraun,J.&Meinzen-Dick,R.(2009).“Land


89 IbrahimForum.(2011).AfricanAgriculture:FromMeetingNeedstoCreatingWealth.[Online].Availableat:http://www.moibrahimfoundation.org/downloads/2013/2011-facts-and-figures.pdf.Accessedon1June2014.

90 Ibid.91 Ibid.92 Tongaat.(2013).AnnualReport.[Online].Available

at:http://www.tongaat.co.za/imc/annual_reports/ar_2013/comment/strategic_position.asp.Accessedon15June2014.

93 ESI-AFrica.com.(2011).IllovotoproduceethanolfrommolassesinTanzania.[Online].Availabletat:http://www.esi-africa.com/illovo-to-produce-ethanol-from-molasses-in-tanzania/.Accessedon29June2014.

94 Landmatrix.(2014).TargetRegion.[Online].Availableat:http://www.landmatrix.org/en/get-the-detail/by-

target-region/.Accessedon12June2014.95 JADAFA.(2012).CountryProfiles.[Online].Available

at:http://jadafa.co.za/country-profiles/tanzania-3/.Accessedon10June2014.

96 JADAFA.(2012).CountryProfiles.[Online].Availableat:http://jadafa.co.za/country-profiles/tanzania-3/.Accessedon10June2014.


98 Arora,M.(2014).InvestmentgrowthinAfricanagriculture.PaneldiscussionbyStandardBankatAgizCongress2014.[Online].Availableat:http://www.agbiz.co.za/congress-2014/archive/agbiz-congress/Accessedon22June2014.

99 Biswalo,D.M.(2011).Thegainsandlossesofforeigndirectinvestmentinagriculture:theTanzaniacasestudy.PaperpresentedattheForeignDirectInvestmentsinAgricultureinEasternAfricaconference.HeldatLaicoRegencyHotel,Nairobi-Kenya,20–23October2011.

100 Arora,M.(2014).InvestmentgrowthinAfricanagriculture.PaneldiscussionbyStandardBankatAgizCongress2014.[Online].Availableat:http://www.agbiz.co.za/congress-2014/archive/agbiz-congress/Accessedon22June2014.






106 Green,A.R.(2012)Africa:GrowingAfrica’sLand.[Online].Availableat:http://allafrica.com/stories/201207030260.html.Accessedon4June2014.



109 Arora,M.(2014).InvestmentgrowthinAFRICANagriculture.PaneldiscussionbyStandardBankatAgizCongress2014.[Online].Availableat:http://www.agbiz.co.za/congress-2014/archive/agbiz-congress/Accessedon22June2014.



112 AfricaProgressPanel.(2014).GrainFishMoney:


FinancingAfrica’sGreenandBlueRevolutions.AfricaProgressReport2014.

113 NDP.(2011).NationalDevelopmentPlan:Visionfor2030.Pretoria:NationalPlanningCommission.

114 Ibid.115 NSS.(2009).StatisticalReforminSouthAfrica.

[Online].Availableat:http://www.statssa.gov.za/nss/index.asp?link=about.asp.Accesson15September2013.

116 VanSchalkwyk,H.,Groenewald,J.,Fraser,G.,Obi,A.&VanTilburg,A.(2012).Unlockingmarketstosmallholders:LessonsfromSouthAfrica.TheNetherlands:WageningenAcademicPublishers.

117 O’Laughlin,B.,Bernstein,H.,Cousins,B.&Peters,P.(2013).Introduction:Agrarianchange,ruralpovertyandlandreforminSouthAfricasince1994.JournalofAgrarianChange13(1):1-15.

118 IOL(2014)PICnotguidedbypolitics-Matjila.[Online]Availableat:http://www.iol.co.za/business/news/pic-not-guided-by-politics-matjila-1.1729770#.U-HDKihD9FI.Accessedon12August2014.




122 Harding,C.I.(2011).Ranked:Africa’stop20agribusinesscompanies.[Online].Availableat:http://www.howwemadeitinafrica.com/ranked-africas-top-20-agribusiness-companies/13532/.Accessedon31May2014.

123 IbrahimForum(2011)AfricanAgriculture:FromMeetingNeedstoCreatingWealth.[Online].Availableat:http://www.moibrahimfoundation.org/downloads/2013/2011-facts-and-figures.pdf.Accessedon1June2014.


125 Ibid.126 Miller,D.(n.d.).FoodFrontiersinZambia:Resistance

andpartnershipsinShoprite’sretailempire.[Online].Availableathttp://africafiles.org/article.asp?id=18515.Accessedon16may2014.

127 Ibid.128 Miller,D.(n.d.).FoodFrontiersinZambia:Resistance

andpartnershipsinShoprite’sretailempire.[Online].Availableathttp://africafiles.org/article.asp?id=18515.Accessedon16may2014.

129 Ibid.130 Clover.(2013).IntegratedReportfortheyear

ended30June2013.[Online].Availableat:http://www.clover.co.za/media/shared/downloadable/annualreport/2013/clover2013arl.pdf.Accessedon29June2014.

131 AstralFoods.(2014).InterimResultssixmonths

ending31March2014.[Online].Availableat:http://www.astralfoods.co.za/presentations/Interim%20Results%20Presentation%20for%20the%20six%20months%20ended%2031%20March%202014.pdf.Accessedon2July2014.

132 AFGRI.(2013).AnnualReport[Online].Availableat:http://www.afgri.co.za/financials/2013/AFGRI_Annual_Report_2013.pdf.Accessedon1July2014.

133 Business Day2014).Sugarlookstoethanoltohelppickupspeed.[Online].Availableat:http://www.bdlive.co.za/businesstimes/2014/04/27/sugar-looks-to-ethanol-to-help-pick-up-speed.Accessedon29June2014.

134 Harding,C.(2012).Interview:ShopriteCEOtalksretailinAfrica.[Online].Availableat:http://www.howwemadeitinafrica.com/interview-shoprite-ceo-talks-retail-in-africa/21086/.Accessedon2July2014.

135 Clover.(2013).IntegratedReportfortheyearended30June2013.[Online].Availableat:http://www.clover.co.za/media/shared/downloadable/annualreport/2013/clover2013arl.pdf.Accessedon29June2014.

136 RCLFoods.(2013).Auditedresultsfortheyearended30June2013.[Online].Availableat:http://www.rclfoods.com/pdf/yearly-reports/2013InvestorPresentation.pdf.Accessedon30June2014.

137 AVI.(2013).IntegratedAnnualReport.[Online].Availableat:http://www.avi.co.za/system/presentations/attachments/93/original/AVIAR2013Lo-Res.pdf?1380547249.Accessedon1July2014.

138 AFGRI(2013).AnnualReport[Online].Availableat:.http://www.afgri.co.za/financials/2013/AFGRIAnnualReport2013.pdf.Accessedon1July2014.


140 Ibid.141 Jacks,M.(2014).Shopritetoopen13newstoresacross

sub-SaharanAfrica.[Online].Availableat:http://www.ventures-africa.com/2014/02/shoprite-to-open-13-new-stores-across-sub-saharan-africa/.Accessed28May2014.

142 AVI.(2013).IntegratedAnnualReport.[Online].Availableat:.http://www.avi.co.za/system/presentations/attachments/93/original/AVIAR2013Lo-Res.pdf?1380547249.Accessedon1July2014.

143 AFGRI(2013).AnnualReport[Online].Availableat:http://www.afgri.co.za/financials/2013/AFGRI_Annual_Report_2013.pdf.Accessedon1July2014.

144 Hanna,S.(2013).SAagribusinessescontinuetolooktoAfricafornewmarkets.[Online].Availableat:http://www.africanbusinessreview.co.za/business_leaders/-sa-agribusinesses-continue-to-look-to-africa-for-new-markets.Accessed19May2014.


146 Clover.(2013).IntegratedReportfortheyearended30June2013.[Online].Availableat:http://www.clover.co.za/media/shared/downloadable/annualreport/2013/clover2013arl.pdf.Accessedon29


June2014.147 Ibid.148 AFGRI(2013)AnnualReport[Online].Availableat:

http://www.afgri.co.za/financials/2013/AFGRI_Annual_Report_2013.pdf.Accessedon1July2014.

149 Sharife,K.(2010)SouthAfrica-Congo‘landgrab’:Exploitationorsalvation?Mail & Guardian.

150 IOL.(2014).Farmeroutcryoverlandbill.[Online].Availableat:http://www.iol.co.za/news/politics/farmer-outcry-over-land-bill-1.1707603.Accessedon24June2014.

151 Hanna,S.(2013)SAagribusinessescontinuetolooktoAfricafornewmarkets.[Online].Availableat:http://www.africanbusinessreview.co.za/business_leaders/-sa-agribusinesses-continue-to-look-to-africa-for-new-markets.Accessed19May2014.


153 Jacks,M.(2014).Shopritetoopen13newstoresacrosssub-SaharanAfrica.[Online].Availableat:http://www.ventures-africa.com/2014/02/shoprite-to-open-13-new-stores-across-sub-saharan-africa/.Accessed28May2014.


155 Jacks,M.(2014).Shopritetoopen13newstoresacrosssub-SaharanAfrica.[Online].Availableat:http://www.ventures-africa.com/2014/02/shoprite-to-open-13-new-stores-across-sub-saharan-africa/.Accessed28May2014.

156 AstralFoods(2014)InterimResultssixmonthsending31March2014.[Online].Availableat:http://www.astralfoods.co.za/presentations/Interim%20Results%20Presentation%20for%20the%20six%20months%20ended%2031%20March%202014.pdf.Accessedon2July2014.



159 Business Day(2014)Sugarlookstoethanoltohelppickupspeed.[Online].Availableat:http://www.bdlive.co.za/businesstimes/2014/04/27/sugar-looks-to-ethanol-to-help-pick-up-speed.Accessedon29June2014.


161 AstralFoods.(2014).InterimResultssixmonthsending31March2014.[Online].Availableat:http://www.astralfoods.co.za/presentations/Interim%20Results%20Presentation%20for%20the%20six%20

months%20ended%2031%20March%202014.pdf.Accessedon2July2014.

162 BusinessDayLive.(2013).NewnameforRainbowChickentoreflectwiderbrandrange.[Online].Availableat:http://www.bdlive.co.za/business/retail/2013/07/04/new-name-for-rainbow-chicken-to-reflect-wider-brand-range.Accessedon30June2014.

163 Business Day(2014).Sugarlookstoethanoltohelppickupspeed.[Online].Availableat:http://www.bdlive.co.za/businesstimes/2014/04/27/sugar-looks-to-ethanol-to-help-pick-up-speed.Accessedon29June2014.


165 PricewaterhouseCooper.(2014).Howconfidentareyou?AgribusinessInsightsSurvey2013/14.[Online].Availableat:http://www.pwc.co.za/en_ZA/za/assets/pdf/agribusinesses-benchmarking-survey-2014.pdf.Accessedon15July2014.


167 Thomas,S.(2012).Shoprite’sAfricanexpansion.[Online].Availableat:http://www.financialmail.co.za/business/2012/12/24/shoprite-s-african-expansion.Accessedon19May2014.

168 Ibid.169 FranchiseAssociationofSouthAfrica.170 Weatherspoon,D.&Reardon,T.(2003).Riseof


171 Reuters.(2011).WalmartcompletesMassmarttakeover.[Online].Availableat:http://www.fin24.com/Companies/Retail/Walmart-completes-Massmart-takeover-20110620.Accessedon1July2014.

172 Motsoeneng,T.&Ndebele,N.(2014).SouthAfrica’sMassmarttoenterAngolawithtwostores.[Online].Availableat:http://www.reuters.com/article/2014/04/08/us-africa-summit-idUSBREA3712520140408.Accessedon1July2014.

173 OceanaGroup.(2014).Integratedreport2013.[Online].Availableat:http://www.oceana-integratedreport.co.za/sites/default/files/2013/Front/Full_Integrated_Report_2013.pdf.Accessedon29June2014.

174 AFKInsider.(2013).WoolworthspullsoutofNigeria,citespoorprofits.[Online].Availableat:http://afkinsider.com/33531/woolworths-pulls-out-of-nigeria/.Accessedon3July2014.


176 Douglas,K.(2012).ShopritetakesontheDRC.[Online].Availableat:http://www.howwemadeitinafrica.com/shoprite-takes-on-the-drc/18854/.Accessedon1July2014.

177 RCLFoods.(2013).Auditedresultsforthe


yearended30June2013.[Online].Availableat:http://www.rclfoods.com/pdf/yearly-reports/2013InvestorPresentation.pdf.Accessedon30June2014.

178 Financial Mail.(2013).Africa’sgrowingappetiteforfastfoods.[Online].Availableat:http://www.financialmail.co.za/business/money/2013/09/12/africa-s-growing-appetite-for-fast-foods.Accessedon29June2014.

179 Mail & Guardian.(2013)SAbusinessisbloominginAfrica.[Online].Availableat:http://mg.co.za/article/2013-06-28-00-sa-business-is-blooming-in-africa.Accessedon12June2014.

180 Arora,M.(2014).InvestmentgrowthinAfricanagriculture.PaneldiscussionbyStandardBankatAgbizCongress2014.[Online].Availableat:http://www.agbiz.co.za/congress-2014/archive/agbiz-congress/Accessedon22June2014.

181 Miller,D.(n.d.).FoodFrontiersinZambia:ResistanceandpartnershipsinShoprite’sretailempire.[Online].Availableathttp://africafiles.org/article.asp?id=18515.Accessedon16May2014.

182 Ibid.183 DPME.(2014).SouthAfricanPresidency’s20Year

Review.Pretoria:DepartmentofPublicMonitoringandEvaluation:Chapter8.

184 Mail & Guardian.(2013).SAbusinessisbloominginAfrica.[Online].Availableat:http://mg.co.za/article/2013-06-28-00-sa-business-is-blooming-in-africa.Accessedon12June2014.

185 Mail & Guardian.(2013).SAbusinessisbloominginAfrica.[Online].Availableat:http://mg.co.za/article/2013-06-28-00-sa-business-is-blooming-in-africa.Accessedon12June2014.

186 Ibid.187 Ernst&YoungGlobalLimited(2014)EY’s

attractivenesssurvey:Africa2014:ExecutingGrowth.[Online].Availableat:http://www.ey.com/Publication/vwLUAssets/EY-attractiveness-africa-2014-Lite/$FILE/EY-attractiveness-africa-2014-Lite.pdf.Accessedon1July2014.

188 Ibid.189 Ibid.190 Ibid.191 Mail & Guardian. (2013).SAbusinessisblooming

inAfrica.[Online].Availableat:http://mg.co.za/article/2013-06-28-00-sa-business-is-blooming-in-africa.Accessedon12June2014.

192 Ibid.193 Weatherspoon,D.&Reardon,T.(2003).Riseof


194 Harding,C.(2012).Interview:ShopriteCEOtalksretailinAfrica.[Online].Availableat:http://www.howwemadeitinafrica.com/interview-shoprite-ceo-talks-retail-in-africa/21086/.Accessedon2July2014.Thesecountriesinclude:Angola,Botswana,Ghana,Lesotho,Madagascar,Malawi,Mauritius,Mozambique,Namibia,Nigeria,Swaziland,Tanzania,Uganda,ZambiaDemocraticRepublicofCongoandSouthAfrica.

195 Ernst&YoungGlobalLimited.(2014).EY’sattractivenesssurvey:Africa2014:Executing

Growth.[Online].Availableat:http://www.ey.com/Publication/vwLUAssets/EY-attractiveness-africa-2014-Lite/$FILE/EY-attractiveness-africa-2014-Lite.pdf.Accessedon1July2014.

196 Ibid.197 Douglas,K.(2012).ShopritetakesontheDRC.[Online].

Availableat:http://www.howwemadeitinafrica.com/shoprite-takes-on-the-drc/18854/.Accessedon1July2014.

198 Motsoeneng,T.(2014).SouthAfrica’sWoolworthseyes15storesacrossAfricain2-3years.[Online].Availableat:http://www.reuters.com/article/2014/04/10/us-africa-summit-woolworths-idUSBREA391GA20140410.Accessedon29June2014.

199 Ibid.200Ibid.201 Ibid.202 UNDP.(2012).Therolesandopportunitiesforthe


203 Ibid.204 Ibid.205 Ibid.206 ACB.(2014).GMcontamination,cartelsandcollusion

inSouthAfrica’sbreadindustry.Johannesburg:AfricanCentreforBiosafety.


208 Ibid.209 Ibid.210 Ibid.211 DuPlessis,L.M.,Kruger,H.S.&Sweet,L.2013.

PaediatricFood-BasedDietaryGuidelinesforSouthAfrica:Complementaryfeeding:acriticalwindowofopportunityfromsixmonthsonwards.South African Journal of Clinical Nutrition26(3)(Supplement):129-14.


213 Arora,M.(2014).InvestmentgrowthinAfricanAgriculture.PaneldiscussionbyStandardBankatAgbizCongress2014.[Online].Availableat:http://www.agbiz.co.za/congress-2014/archive/agbiz-congress/Accessedon22June2014.

214 *Hedley,N.(2013).LocalfoodcompanieslooktoexpandfurtherinAfrica.[Online].Availableat:http://www.bdlive.co.za/business/retail/2013/10/24/local-food-companies-look-to-expand-further-in-africa.Accessedon12June2014.**Maritz,J.(2013)SouthAfricanfoodcompaniescontinueexpansionintorestofcontinent.[Online].Availableat:http://www.howwemadeitinafrica.com/south-african-food-companies-continue-expansion-into-rest-of-continent/24110/.Accessed12June2014.***Arora,M.(2014).InvestmentgrowthinAfricanAgriculture.PaneldiscussionbyStandardBankatAgbizCongress2014.[Online].Availableat:http://www.agbiz.co.za/


congress-2014/archive/agbiz-congress/Accessedon22June2014.

215 TigerBrands(n.d.).TigerBrands.[Online].Availableat:http://www.tigerbrands.co.za/ourworld.php#socioQuick.Accessedon29June2014.

216 Oceana(n.d.).Oceana.[Online].Availableat:http://www.oceana.co.za/.Accessedon30June2014.

217 Ibid.218 OceanaGroup.(2013).OceanaGroupLimited

SustainabilityReport2013.[Online].Availableat:http://oceana-integratedreport.co.za/sites/default/files/2013/sus/Sustainability_Report_13Dec.pdf.Accessedon30June2014.

219 SAMAG.(n.d).TheOceanaGroup:FreshProfits.[Online].Availableat:http://thesa-mag.com/features/agriculture/oceana-group-fresh-profits/.Accessedon29June2014.

220 OceanaGroup.(2013).OceanaGroupLimitedSustainabilityReport2013.[Online].Availableat:http://oceana-integratedreport.co.za/sites/default/files/2013/sus/Sustainability_Report_13Dec.pdf.Accessedon30June2014.

221 Ibid.222 CompetitionTribunal.(2014).Inthematterbetween

OceanaGroupLimited/FoodcorpLimitedandtheCompetitionCommission.[Online].Availableat:http://www.comptrib.co.za/assets/Uploads/Oceana-Foodcorp-Final-Version-Non-Confidential-3.pdf.Accessedon3July2014.

223 Ibid.224 RCLFoods.(2014).InvestorRelations.[Online].

Availableat:http://www.rclfoods.com/investor-relations.Accessedon30June2014.

225 Foodcorp.(2013).RainbowChickenAcquisitionofMajorityStakeinFoodcorpgetsthego-ahead.[Online].Availableat:http://www.foodcorp.co.za/news/brand-news/rainbow-chicken-aquisition-of-majority-stake-in-foodcorp-gets-the-go-ahead.aspx.Accessedon30June2014.

226 RainbowChicken.(n.d.).CompanyProfile[Online].Availableat:http://www.rainbowchicken.co.za/about_company.aspx.Accessedon30June2014.

227 Ibid.228 RCLFoods.(2013).Auditedresultsforthe

yearended30June2013.[Online].Availableat:http://www.rclfoods.com/pdf/yearly-reports/2013InvestorPresentation.pdf.Accessedon30June2014.

229 Ibid.230 Maritz,J.(2013).SouthAfricanfoodcompanies

continueexpansionintorestofcontinent.[Online].Availableat:http://www.howwemadeitinafrica.com/south-african-food-companies-continue-expansion-into-rest-of-continent/24110/.Accessed12June2014.

231 Jacks,M.(2014).RCLFoodsacquiresSennFoodsfor$7.7million.[Online].Availableat:http://www.ventures-africa.com/2014/05/rcl-foods-acquires-senn-foods-for-77m/.Accessedon30June2014.

232 Ibid.233 Astral.(n.d).AboutUs.[Online].Availableat:http://

www.astralfoods.co.za/.Accessedon30June2014.234 Ibid.235 Maritz,J.(2013).SouthAfricanfoodcompanies

continueexpansionintorestofcontinent.[Online].

Availableat:http://www.howwemadeitinafrica.com/south-african-food-companies-continue-expansion-into-rest-of-continent/24110/.Accessed12June2014.

236 Ibid.237 Finweek(2012)AstralscramblesforbiggerAfrican

nestegg.[Online].Availableat:http://finweek.com/2012/03/09/astral-scrambles-for-bigger-african-nest-egg/.Accessedon2July2014.

238 Naidoo,N.(2014).AstralentersintosupplyagreementwithQuantum.[Online].Availableat:http://www.cnbcafrica.com/news/southern-africa/2014/04/03/astral-enters-into-supply-agreement-with-quantum/.Accessedon2July2014.

239 Ibid.240 Hedley,N.(2013).Localfoodcompanieslookto

expandfurtherinAfrica.[Online].Availableat:http://www.bdlive.co.za/business/retail/2013/10/24/local-food-companies-look-to-expand-further-in-africa.Accessedon12June2014.

241 Ibid.242 Ibid.243 Sanchez,D.(2014).InSABMiller’smarchacross

Africa,NigeriaNo.2beermarket.[Online].Availableat:http://afkinsider.com/58288/sab-millers-march-across-africa-nigeria-2-beer-market/.Accessedon16June2014.

244 Ibid.245 Ibid.246 Ibid.247 AFGRI.(n.d.).AFGRIAfrica.[Online].Available

at:http://www.afgri.co.za/ops_afgri_africa.php.Accessedon1July2014.

248 Business Day (2014).Sugarlookstoethanoltohelppickupspeed.[Online].Availableat:http://www.bdlive.co.za/businesstimes/2014/04/27/sugar-looks-to-ethanol-to-help-pick-up-speed.Accessedon29June2014.



251 Latham,B.(2011).S.[South]AfricafarmersshunLibya,targetSudanbananas,Egyptgrapes.[Online].Availableat:http://farmlandgrab.org/post/view/18207.Accessedon11June2014.

252 Agbiz(2014)AgbizConfidenceIndexMarch2014.Pretoria:AgriculturalBusinessChamber.

253 Ibid.254 Hall,R.(2013)Exportingdualism?TheExpansion

ofSouthAfricancapitalinAfricanfarmlanddeals.Bellville,WesternCape:InstituteforPoverty,LandandAgrarianStudies.

255 Lourens,C.(2010).AfricannationsturntoSouthAfricaforagriculturalexpertise.[Online].Availableat:http://www.bloomberg.com/apps/news?pid=newsarchive&sid=acnRtxdc3zIQ.Accessedon5June2014.

256 Ibid.257 AgriSA.(2012/2013).AnnualReport.[Online].


Availableat:http://www.agrisa.co.za/wp-content/uploads/2013/08/Verslage-2013-Africa.pdf.Accessedon1July2014.

258 Ibid.259 Ibid.260 Ibid.261 Agriallafrica(n.d.)Policy.[Online].Availableat:http://

www.agriallafrica.com/policy.html.Accessedon29June2014.

262 Ibid.263 Ibid.264 SACAU.(2013).AnnualReport2013oftheSouthern

AfricanConfederationofAgriculturalUnions.[Online].Availableat:http://www.sacau.org/wp-content/uploads/2014/04/sacau-version-3d_custom_version.pdf.Accessedon28June2014.

265 Latham,B.(2011).S.[South]AfricafarmersshunLibya,targetSudanbananas,Egyptgrapes.[Online].Availableat:http://farmlandgrab.org/post/view/18207.Accessedon11June2014.

266 Hall,R.(2013).Exportingdualism?TheExpansionofSouthAfricancapitalinAfricanfarmlanddeals.Bellville,WesternCape:InstituteforPoverty,LandandAgrarianStudies.

267 TongaatHulett.(n.d.).TongaatHulett.[Online].Availableat:http://www.tongaat.co.za/.Accessedon30June2014.

268 Ibid.269 Ibid.270 IllovoSugar.(2014).AboutUs.[Online].Availableat:

http://www.illovosugar.co.za/Home.aspx.Accessedon29June2014.

271 Ibid.272 Ibid.273 Farmer’s Weekly.(2014).PositioningIllovo

SugarforgrowthinAfrica.[Online].Availableat:http://www.farmersweekly.co.za/article.aspx?id=55986&h=Positioning-Illovo-Sugar-for-growth-in-Africa.Accessedon30June2014.

274 Tongaat.(2013).AnnualReport.[Online].Availableat:http://www.tongaat.co.za/imc/annual_reports/ar_2013/comment/strategic_position.asp.Accessedon15June2014.


276 ESI-AFrica.com.(2011).IllovotoproduceethanolfrommolassesinTanzania.[Online].Availableat:http://www.esi-africa.com/illovo-to-produce-ethanol-from-molasses-in-tanzania/.Accessedon29June2014.

277 Farmer’s Weekly.(2014).PositioningIllovoSugarforgrowthinAfrica.[Online].Availableat:http://www.farmersweekly.co.za/article.aspx?id=55986&h=Positioning-Illovo-Sugar-for-growth-in-Africa.Accessedon30June2014.

278 Ibid.279 AGRA.(n.d.).AboutUs.[Online].Availableat:http://

agra-alliance.org/who-we-are/our-story/#.U94yf_mSxHw.Accessedon3August2014.

280 WorldBank.(2013).GrowingAfrica:UnlockingthepotentialofAgribusiness.NewYork:WorldBank.

281 GROW.(2014).ThecommercialseedmarketinAfrica2014.[Online].Availableat:https://store.agra-net.com/reports/commercseed14.html.Accessedon26

June2014.282 Mooney,P.(2012).Concentrationoftheseedindustry.

InSeed Freedom: A Global Citizen’s Report.NewDelhi:Navdanya.

283 Hubbard,K.(2013).Seed Industry Consolidation is still ‘out of hand’.[Online].Availableat:http://blog.seedalliance.org/2013/09/17/seed-industry-consolidation-is-still-out-of-hand/.Accessedon1October2013.

284 NationalAgriculturalMarketingCouncil.(2012).DesktopviewoftheSouthAfricanseedindustry:Alookatthevaluechainanddifferentactivitiesandrole-players.[Online].Availableat:http://www.namc.co.za/upload/per_category/South%20African%20Seed%20Industry%20-%20a%20desktop%20study.pdf.Accessedon28May2014.

285 GRAIN.(2010).Globalagribusiness:twodecadesofplunder.SeedlingJuly2010.

286 GROW.(2014).ThecommercialseedmarketinAfrica2014.[Online].Availableat:https://store.agra-net.com/reports/commercseed14.html.Accessedon26June2014.

287 AGRA.(2014).NewreportfindsAfricanseedindustrynowdominatedbylocalstart-ups.[Online].Availableat:http://www.agra.org/media-centre/news/new-report-finds-african-seed-industry-now-dominated-by-local-startups-/#.U6vtt0BLOZQ.Accessedon26June2014.

288 GROW.(2014).ThecommercialseedmarketinAfrica2014.[Online].Availableat:https://store.agra-net.com/reports/commercseed14.html.Accessedon26June2014.

289 Monsanto.(n.d).Whoweare.[Online].Availableat:http://www.monsanto.com/whoweare/pages/our-locations.aspx.Accessedon13June2014.

290 FarmChemicalInternational(2013).SyngentatoacquireAfricancornseedbusiness.[Online].Availableat:http://www.farmchemicalsinternational.com/markets/africa/syngenta-to-acquire-african-corn-seed-business/.Accessedon12June2014.

291 Syngenta.(2013).Global[Online].Availableat:http://www.syngenta.com/global/corporate/en/news-center/events-and-presentations/pages/feature-27-05-2013.aspx.Accessedon12June2014.

292 FarmChemicalInternational.(2013).SyngentatoacquireAfricancornseedbusiness.[Online].Availableat:http://www.farmchemicalsinternational.com/markets/africa/syngenta-to-acquire-african-corn-seed-business/.Accessedon12June2014.

293 Ibid.294 Ibid.295 DuPont.(2013).DataBook.[Online].Availableat:

www.dupont.com.Accessedon29June2014.296 Rangnekar,D.(2001).Access to Genetic Resources,

Gene-based inventions and Agriculture.[Online].Availableat:http://www.planttreaty.org/content/access-genetic-resources-gene-based-inventions-and-agriculture.Accessedon3September2013;Howard,P.(2009)VisualizingConsolidationintheGlobalSeedIndustry:1996-2008.Sustainability1:1266-1287.

297 Brahy,N.(2009).Intellectual Property of Agricultural Resources and Biodiversity.ExpertSubmissiontotheUnitedNationsSpecialRapporteurontheRighttoFood,OlivierdeSchutter.[Online].Availableat:http://www.unamur.be/droit/crid/propriete/rapport-olivier-


de-schutter.Accessedon3March2013;Wield,D.,Chataway,J.&Bolo,M.(2010).Issuesinthepoliticaleconomyofagriculturalbiotechnology.Journal of Agrarian Change10(3):342-366;Fulton,M.&Giannakas,K.(2001).AgriculturalBiotechnologyandIndustryStructure.AgBioForum4(2):pg137-151.

298 Moss,D.L.(2011).Competitionandtransgenicseedsystems.The Anti-trust Bulletin56(1):81.

299 Fulton,M.&Giannakas,K.(2001).AgriculturalBiotechnologyandIndustryStructure.AgBioForum4(2):pg137-151.

300 Wield,D.,Chataway,J.&Bolo,M.(2010).Issuesinthepoliticaleconomyofagriculturalbiotechnology.Journal of Agrarian Change10(3):342-366.

301 IGD(n.d.).IGDAGINVEST:catalysingagribusinessinvestmentsinAfrica.[Online].Availableat:http://www.google.co.za/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=0CB0QFjAA&url=http%3A%2F%2Fwww.igdleaders.org%2Finsight%2Figd-aginvest-catalyzing-agribusiness-investments-in-africa%2F&ei=WSLqU9TpOYWm0QWg24HIBQ&usg=AFQjCNH9kAQwC2GL2Ymg6em4ci6w8MTGhA&bvm=bv.72676100,d.d2k.Accessedon15July2014.

302 ACB.(2012).AllianceforaGreenRevolutioninAfrica(AGRA).LayingthegroundworkforthecommercialisationofAfricanAgriculture.Johannesburg:AfricanCentreforBiosafety.

303 Brahy,N.(2009).IntellectualPropertyofAgriculturalResourcesandBiodiversity.ExpertSubmissiontotheUnitedNationsSpecialRapporteurontheRighttoFood,OlivierdeSchutter.[Online].Availableat:http://www.unamur.be/droit/crid/propriete/rapport-olivier-de-schutter.Accessedon3March2013.CGRFA.(2010).TheSecondReportonTheStateoftheWorld’sPlantGeneticResourcesforFoodandAgriculture.Rome:FoodandAgricultureOrganisationCommissiononGeneticResourcesforFoodandAgriculture.


305 Ibid.306 Maritz,J.(2012).CommercialfarmingintheCongo

notforthefaint-hearted.[Online].Availableat:http://www.howwemadeitinafrica.com/commercial-farming-in-the-congo-not-for-the-faint-hearted/21576/.Accessedon1June2014.



309 PricewaterhouseCoopers.(n.d.).CompetingforAfricanmarkets:Strategiestowinnewbusinessnow.[Online].Availableat:http://www.pwc.com/us/en/view/issue-16/strategies-win-african-business.jhtml.Accessedon16June2014.

310 Hanna,S.(2013).SAagribusinessescontinuetolooktoAfricafornewmarkets.[Online].Availableat:http://www.africanbusinessreview.co.za/business_leaders/-

sa-agribusinesses-continue-to-look-to-africa-for-new-markets.Accessed19May2014.

311 Deloitte.(n.d.).AddressingAfrica’sinfrastructurechallenge.[Online].Availableat:http://www2.deloitte.com/content/dam/Deloitte/global/Documents/Energy-and-Resources/dttl-er-africasinfrastructure-08082013.pdf.Accessedon26June2014.

312 Arora,M.(2014).InvestmentgrowthinAfricanagriculture.PaneldiscussionbyStandardBankatAgbizCongress2014.[Online].Availableat:http://www.agbiz.co.za/congress-2014/archive/agbiz-congress/Accessedon22June2014.

313 Fletcher,P.(2014).ShopritefaceschallengesinNigeria’ssecondcity.[Online].Availableat:http://www.bdlive.co.za/africa/africanbusiness/2014/04/10/shoprite-faces-challenges-in-nigerias-second-city.Accessedon5June2014.

314 DPME.(2014).SouthAfricanPresidency’s20YearReview.Pretoria:DepartmentofPublicMonitoringandEvaluation:Chapter8.

315 AfricanDevelopmentBankGroup.(2010).AgricultureSectorStrategy2010–2014.AfricanDevelopmentBank:AgricultureandAgro-IndustryDepartmentandOperationalResourcesandPoliciesDepartment.

316 Juma,C.(2012).PoorinfrastructureisAfrica’ssoftunderbelly.[Online].Availableat:http://www.forbes.com/sites/mfonobongnsehe/2012/10/25/poor-infrastructure-is-africas-soft-underbelly/.Accessedon26June2014.


318 Ibid.319 Ibid.320 TigerBrands.(n.d.).TigerBrands.[Online].Available

at:http://www.tigerbrands.co.za/ourworld.php#socioQuick.Accessedon29June2014.


322 Ibid.323 AFKInsider.(2013).WoolworthspullsoutofNigeria,

citespoorprofits.[Online].Availableat:http://afkinsider.com/33531/woolworths-pulls-out-of-nigeria/.Accessedon3July2014.

324 Ibid.325 AfricaProgressPanel.(2014).GrainFishMoney:


326 Ibid.327 Ibid.328 StandardBank.(2014).ResilientPropertyIncome

Fund.[Online].Availableat:file:///C:/Users/Stefanie/Downloads/Flash_Note_20140210_113413260.pdf.Accessedon19June2014.

329 Ibid.330 Norberg-Hodge.(2000).Bringingthefoodeconomy

home.Thesocial,ecologicalandeconomicbenefitsoflocalfood. UnitedKingdom:ISECChp5,6,7&8.

331 Deloitte.(n.d.).AddressingAfrica’sinfrastructurechallenge.[Online].Availableat:http://www2.


deloitte.com/content/dam/Deloitte/global/Documents/Energy-and-Resources/dttl-er-africasinfrastructure-08082013.pdf.Accessedon26June2014.


333 Norberg-Hodge.(2000).Bringingthefoodeconomyhome.Thesocial,ecologicalandeconomicbenefitsoflocalfood.UnitedKingdom:ISECChp5,6,7&8.

334 Ibid.335 Ibid.336 Miller,D.(n.d.).FoodFrontiersinZambia:Resistance

andpartnershipsinshoprites’retailempire.[Online].Availableathttp://africafiles.org/article.asp?id=18515.Accessedon16May2014.

337 Reardon,T.,Timmer,C.,Barrett,C.&JulioBerdegué.(2003).TheRiseofSupermarketsinAfrica,Asia,andLatinAmerica.AmericanAgriculturalEconomicsAssociation85:5.pp.1140-1146.

338 Jordaan,D.(2012).Anoverviewofincentivestheoryandpractice:Afocusontheagro-processingindustryinSouthAfrica.Pretoria:DepartmentofAgriculture,ForestryandFisheries:Directorate:Agro-processingsupport.

339 Ibid.340 Ibid.341 Arora,M.(2014).InvestmentgrowthinAfrican

agriculture.PaneldiscussionbyStandardBankatAgbizCongress2014.[Online].Availableat:http://www.agbiz.co.za/congress-2014/archive/agbiz-congress/Accessedon22June2014.


343 Hall,R.(2011).ThenextGreatTrek?SouthAfricancommercialfarmersmovenorth.PaperpresentedattheInternationalConferenceonGlobalLandGrabbing(6–8April2011).

344 Biswalo,D.M.(2011)Thegainsandlossesofforeigndirectinvestmentinagriculture:theTanzaniacasestudy.PaperpresentedattheForeignDirectInvestmentsinAgricultureinEasternAfricaconference.HeldatLaicoRegencyHotel,Nairobi-Kenya,20–23October2011.

345 Arora,M.(2014)InvestmentgrowthinAfricanagriculture.PaneldiscussionbyStandardBankatAgbizCongress2014.[Online}Availableat:http://www.agbiz.co.za/congress-2014/archive/agbiz-congress/Accessedon22June2014.

346 Ibid.347 Jordaan,D.(2012).Anoverviewofincentivestheory

andpractice:Afocusontheagro-processingindustryinSouthAfrica.Pretoria:DepartmentofAgriculture,ForestryandFisheries:Directorate:Agro-processingsupport.



andpractice:Afocusontheagro-processingindustryinSouthAfrica.Pretoria:DepartmentofAgriculture,

ForestryandFisheries:Directorate:Agro-processingsupport.

351 Mwilima,N.(2003).ForeigndirectinvestmentinAfrica.AfricaLabourResearchNetwork:LabourResourceandResearchInstitute.


andpractice:Afocusontheagro-processingindustryinSouthAfrica.Pretoria:DepartmentofAgriculture,ForestryandFisheries:Directorate:Agro-processingsupport.

354 Ibid.355 Mwilima,N.(2003).Foreigndirectinvestmentin

Africa.AfricaLabourResearchNetwork:LabourResourceandResearchInstitute.

356 Engineering News.(2014).I&JinvestsR500minnewvessels,processingfacilityupgrade.[Online].Availableat:http://www.engineeringnews.co.za/article/ij-invests-r500m-in-new-vessels-processing-facility-upgrade-2014-06-04.Accessedon1July2014.



359 Oceana.(n.d.).Oceana.[Online].Availableat:http://www.oceana.co.za/.Accessedon30June2014.

360 TigerBrands.(n.d.).TigerBrands.[Online].Availableat:http://www.tigerbrands.co.za/ourworld.php#socioQuick.Accessedon29June2014.

361 Clover.(n.d.).BusinessOverview[Online].Availableat:http://www.clover.co.za/company-overview.Accessedon29June2014.

362 NovaCapital.(2011).CloverIndustriesLtd.[Online].Availableat:http://www.novacapitalpartners.com/marketcommentary/Nova%20Company%20Research%20-%20Clover%20Industries%20Ltd%20-%20June%202011.pdf.Accessedon29June2014.

363 AfricanDevelopmentBank.(2014).TheBank’sHumanCapitalDevelopmentStrategy(2014–2018).[Online].Availableat:http://www.afdb.org/fileadmin/uploads/afdb/Documents/Policy-Documents/AfDB_Human_Capital_Strategy_for_Africa_2014-2018.pdf.Accessedon20June2014.



366 Ibid.367 NEPAD.(2010).ExecutivesummaryofAU-NEPAD’s

AfricanInnovationOutlook2010.Pretoria:AU-NEPAD.368 NEPAD.(2010).ExecutivesummaryofAU-NEPAD’s

AfricanInnovationOutlook2010.Pretoria:AU-NEPAD.369 Ibid.370 Ibid.371 Ibid.


372 Ibid.373 Ibid.374 Ibid.375 AfricanDevelopmentBank.(2014).TheBank’sHuman

CapitalDevelopmentStrategy(2014–2018).[Online].Availableat:http://www.afdb.org/fileadmin/uploads/afdb/Documents/Policy-Documents/AfDB_Human_Capital_Strategy_for_Africa_2014-2018.pdf.Accessedon20June2014.

376 Ibid.377 Ibid.378 Ibid.379 NEPAD.(2010).ExecutivesummaryofAU-NEPAD’s

AfricanInnovationOutlook2010.Pretoria:AU-NEPAD.380 Ibid.381 PricewaterhouseCoopers.(n.d.).Competingfor

Africanmarkets:Strategiestowinnewbusinessnow.[Online].Availableat:http://www.pwc.com/us/en/view/issue-16/strategies-win-african-business.jhtml.Accessedon16June2014.

382 Ibid.383 AFGRI.(2013).AnnualReport[Online].Available

at:http://www.afgri.co.za/financials/2013/AFGRI_Annual_Report_2013.pdf.Accessedon1July2014.


385 IllovoSugar.(2014).AboutUs.[Online].Availableat:http://www.illovosugar.co.za/Home.aspx.Accessedon29June2014.

386 Ernst&YoungGlobalLimited.(2014).EY’sattractivenesssurvey:Africa2014:ExecutingGrowth.[Online].Availableat:http://www.ey.com/Publication/vwLUAssets/EY-attractiveness-africa-2014-Lite/$FILE/EY-attractiveness-africa-2014-Lite.pdf.Accessedon1July2014.




390 AFKInsider.(2013).WoolworthspullsoutofNigeria,citespoorprofits.[Online].Availableat:http://afkinsider.com/33531/woolworths-pulls-out-of-nigeria/.Accessedon3July2014.



393 AFGRI.(n.d.).AFGRIAfrica.[Online].Availableat:http://www.afgri.co.za/ops_afgri_africa.php.Accessedon1July2014.

394 Green,A.R.(2012).Africa:GrowingAfrica’sLand.


395 Fletcher,P.(2014).ShopritefaceschallengesinNigeria’ssecondcity.[Online].Availableat:http://www.bdlive.co.za/africa/africanbusiness/2014/04/10/shoprite-faces-challenges-in-nigerias-second-city.Accessedon5June2014.


397 Ibid.398 Ibid.399 DPME.(2014).SouthAfricanPresidency’s20Year

Review.Pretoria:DepartmentofPublicMonitoringandEvaluation:Chapter8.

400PricewaterhouseCoopers.(n.d.).CompetingforAfricanmarkets:Strategiestowinnewbusinessnow.[Online].Availableat:http://www.pwc.com/us/en/view/issue-16/strategies-win-african-business.jhtml.Accessedon16June2014.




404 Ibid.405 Ibid.406ACB.(2013).Givingwithonehandandtakingwith

two:AcritiqueofAgra’sAfricanAgricultureStatusReport2013.Johannesburg:AfricanCentreforBiosafety.


408USAID.(2014).SouthernAfricaTradeHubStrategicPartnershipGrants:Results&ReflectionsfromMozambique,MalawiandZambia.[Online].Availableat:http://www.jadafa.co.za/LinkClick.aspx?fileticket=MfGRd11cf9Y%3d&tabid=173Accessedon29May2014.

409UNDP.(2012).TherolesandopportunitiesfortheprivatesectorinAfrica’sagro-foodindustry.UNDPAfricanFacilityforinclusivemarkets.[Online].Availableat:www.undp.org/africa/privatesector.Accessedon16June2014.

410 JADAFA.(n.d.).JointAgribusinessDepartmentofAgricultureForumforAfrica.[Online].Availableat:http://www.jadafa.co.za/.Accessedon10June2014.

411 Ibid.412 NEPAD(2010)ExecutivesummaryofAU-NEPAD’s

AfricanInnovationOutlook2010.Pretoria:AU-NEPAD.413 NDP.(2011).NationalDevelopmentPlan:Visionfor

2030.Pretoria:NationalPlanningCommission.



415 CGIAR.(n.d.).CelebratingcreativeandinnovativefarmersaroundEastAfrica.[Online].Availableat:http://ccafs.cgiar.org/blog/celebrating-creative-and-innovative-farmers-around-east-africa#.U7ZWHfmSxHw.Accessedon2July2014.


417 AVI.(2013).IntegratedAnnualReport.[Online].Availableat:http://www.avi.co.za/system/presentations/attachments/93/original/AVI_AR_2013_Lo-Res.pdf?1380547249.Accessedon1July2014.

418 Ibid.419 NovaCapital.(2011).CloverIndustriesLtd.[Online].

Availableat:http://www.novacapitalpartners.com/marketcommentary/Nova%20Company%20Research%20-%20Clover%20Industries%20Ltd%20-%20June%202011.pdf.Accessedon29June2014.


421 Ibid.422 TigerBrands.(n.d.).TigerBrands.[Online].Available

at:http://www.tigerbrands.co.za/ourworld.php#socioQuick.Accessedon29June2014.

423 AVI.(2013).IntegratedAnnualReport.[Online].Availableat:http://www.avi.co.za/system/presentations/attachments/93/original/AVI_AR_2013_Lo-Res.pdf?1380547249.Accessedon1July2014.

424 PricewaterhouseCoopers.(n.d.)CompetingforAfricanmarkets:Strategiestowinnewbusinessnow.[Online].Availableat:http://www.pwc.com/us/en/view/issue-16/strategies-win-african-business.jhtml.Accessedon16June2014.


426 Cohen,M.&Garret,J.(2009).TheFoodPriceCrisisandurbanfood.(in)security.Human Settlements Working Paper Series.London:InternationalInstituteforEnvironmentandDevelopment.

427 Microsoft.com.(n.d.).Africa’sbiggestfoodretailerchoosesnewpoint-of-serviceoperatingsystem.[Online].Availableat:https://www.google.co.za/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0CDQQFjAA&url=http%3A%2F%2Fwww.microsoft.com%2Fcasestudies%2FServeFileResource.aspx%3F4000001350&ei=7HO2U4i0O7Tb7AaSh4H4CQ&usg=AFQjCNFm2ITnqfAO_Ia_H-aYGT9qB1MtWA&bvm=bv.70138588,d.ZGU.Accessedon2July2014.

428 DeSchutter,O.(2011).TheRightofEveryonetoEnjoytheBenefitsofScientificProgressandtheRighttoFood:FromConflicttoComplementarity.Human Rights Quarterly33:304-350.

429 Ibid.430 CGRFA.(2010).The Second Report on The State of

the World’s Plant Genetic Resources for Food and

Agriculture.Rome:FoodandAgricultureOrganisationCommissiononGeneticResourcesforFoodandAgriculture.


432 Miller,D.(n.d.).FoodFrontiersinZambia:Resistanceandpartnershipsinshoprites’retailempire.[Online].Availableathttp://africafiles.org/article.asp?id=18515.Accessedon16May2014.

433 Kirsten,J.,Agdulrahman,A.&Bopape,L.(2007).TheimpactofmarketpoweranddominanceofsupermarketsonagriculturalproducersinSouthAfrica:AcasestudyoftheSouthAfricandairyindustry.NationalAgriculturalMarketingCouncil.

434 Reardon,T.,Timmer,C.,Barrett,C.&JulioBerdegué.(2003).TheRiseofSupermarketsinAfrica,Asia,andLatinAmerica.AmericanAgriculturalEconomicsAssociation85:5.pp.1140–1146.




438 Fulton,M.&Giannakas,K.(2001).AgriculturalBiotechnologyandIndustryStructure.AgBioForum4(2):pg137–151.

439 Reardon,T.,Timmer,C.,Barrett,C.&JulioBerdegué.(2003).TheRiseofSupermarketsinAfrica,Asia,andLatinAmerica.AmericanAgriculturalEconomicsAssociation85:5.pp.1140–1146.

440Weatherspoon,D.&Reardon,T.(2003).TheriseofsupermarketsinAfrica:ImplicationsforAgrifoodSystemsandtheRuralPoor.Development and Policy Review21(3).


442 LeadCapital.(2008).Nigeria’sFlourMillingIndustry.[Online].Availableat:file:///C:/Users/Stefanie/Downloads/Flour%20Milling%20Industry%20Report%20010408%20-%20LeadCapital.pdf.Accessedon2July2014

443 Kirsten,J.,Agdulrahman,A.&Bopape,L(2007).TheimpactofmarketpoweranddominanceofsupermarketsonagriculturalproducersinSouthAfrica:AcasestudyoftheSouthAfricandairyindustry.NationalAgriculturalMarketingCouncil.

444 Ibid.445 ShopriteHoldings.(2013).SustainabilityReport.

[Online].Availableat:www.shopriteholdings.co.za/sustainability/sustainability/Pages/Sustainability-Report2013.aspx.Accessedon23April2014.

446 Weatherspoon,D.&Reardon,T.(2003).RiseofSupermarketsinAfrica:ImplicationsforAgrifood


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447 Kirsten,J.,Agdulrahman,A.&Bopape,L.(2007).TheimpactofmarketpoweranddominanceofsupermarketsonagriculturalproducersinSouthAfrica:AcasestudyoftheSouthAfricandairyindustry.NationalAgriculturalMarketingCouncil.

448449 DepartmentofAgricultureandForestry[DAFF].

(2010).IntroducingAgro-processing:TheStatusoftheAgro-processingIndustryinSouthAfrica.[Online].Availableat:http://www.nda.agric.za/doaDev/sideMenu/AgroProcessingSupport/docs/Brief_introducting%20agro%20processing.pdf.Accessedon21June2014.

450 Cohen,M.&Garret,J.(2009).TheFoodPriceCrisisandurbanfood(in)security.Human Settlements Working Paper Series.London:InternationalInstituteforEnvironmentandDevelopment.

451 Ibid.452 Kirsten,J.,Agdulrahman,A.&Bopape,L.(2007).

TheimpactofmarketpoweranddominanceofsupermarketsonagriculturalproducersinSouthAfrica:AcasestudyoftheSouthAfricandairyindustry.NationalAgriculturalMarketingCouncil.

453 Lang,T.&HeasmanmM.(2004).FoodWars—TheGlobalBattleforMouths,MindsandMarkets.London:EarthscanPublicationsLtd.Chp1:11–46.

454 DuPlessis,L.(2013).InfantandyoungchildfeedinginSouthAfrica:stopthecrying,belovedcountry.South African Journal of Clinical Nutrition26(1):4–5.

455 Cohen,M.&Garret,J.(2009).TheFoodPriceCrisisandurbanfood(in)security.Human Settlements Working Paper Series.London:InternationalInstituteforEnvironmentandDevelopment.


457 Ibid.458 Mellon,M.(2013).Let’s Drop “Feed the World”: A plea to

move beyond an unhelpful phrase.UnionofConcernedScientists.[Online].http://blog.ucsusa.org/lets-drop-feed-the-world-a-plea-to-move-beyond-an-unhelpful-phrase-229.Accessedon10October2013.

459 Barthel,S.,Crumley,C.&Svedin,U.(2013).Bio-culturalrefugia—Safeguardingdiversityofpracticesforfoodsecurityandbiodiversity.Global Environmental Change.[Online].Availableat:http://www.sciencedirect.com/science/article/pii/S0959378013000757.Accessed14August2013.

460Gonzalez,C.(2012).Theglobalfoodsystem,environmentalprotection,andhumanrights. Natural Resources & Environment26(3):7.

461 NPC.(2011).National Development Plan: Vision for 2030.Pretoria:NationalPlanningCommissionRepublicofSouthAfrica.



464 VonBraun,J.&Meinzen-Dick,R.(2009).“Land


465 Sassenrath,G.F.,Heilman,P.,Luschei,E.,Bennett,G.L.,et al.(2008).Technology,complexityandchangeinagriculturalproductionsystems.Renewable Agriculture and Food Systems23(4):285–295.


467 Ibid.468 Ibid.469 Ibid.470 Jacobs,R(n.d.)Theradicalisationofthestrugglesof

thefoodsovereigntymovementinAfrica.[Online]Availableat:http://viacampesina.org/downloads/pdf/openbooks/EN-11.pdf.Accessedon10August2014.

471 Jacobs,R(n.d.)TheradicalisationofthestrugglesofthefoodsovereigntymovementinAfrica.[Online]Availableat:http://viacampesina.org/downloads/pdf/openbooks/EN-11.pdf.Accessedon10August2014.

472 Jacobs,R(n.d.)TheradicalisationofthestrugglesofthefoodsovereigntymovementinAfrica.[Online]Availableat:http://viacampesina.org/downloads/pdf/openbooks/EN-11.pdf.Accessedon10August2014.


474 Ibid.475 DAFF.(2011).PlantBreeders’RightsPolicy.Pretoria:

DepartmentofAgriculture,ForestryandFisheries.476 Vanloqueren,G.&Baret,P.(2009).Howagricultural

researchsystemsshapeatechnologicalregimethatdevelopsgeneticengineeringbutlocksoutagro-ecologicalinnovations.ResearchPolicy38:971–983.

477 RoyalSociety.(2009).Reapingthebenefits:Scienceandthesustainableintensificationofglobalagriculture.London:RoyalSociety

478 Moss,D.L.(2011).Competitionandtransgenicseedsystems.The Antitrust Bulletin56(1):81.


480Sherry,S.(2013).DuPontbetsonAfrica’sglobalfoodrolewithPannarSeeddeal.[Online].Availableat:http://www.bdlive.co.za/business/agriculture/2013/08/01/dupont-bets-on-africas-global-food-role-with-pannar-seed-deal.Accessedon12June2014.

481 Moss,D.L.(2011).Competitionandtransgenicseedsystems.TheAntitrustBulletin56(1):81.

Schenkelaars,P.(2011).DriversofConsolidationintheSeedIndustryanditsConsequencesforInnovation.Amsterdam:CommissiononGeneticModification(COGEM).

482 Kim,R.,Larsen,K.&Theus,F.(2009).Introductionandmainmessages.InAgribusinessandInnovationSystemsinAfrica.Eds:K.Larsen,Kim.R.&F.Theus(EDS).WashingtonDC:WorldBank.

483 Ibid.484 Ibid.485 AfricaProgressPanel.(2014).GrainFishMoney:





488 Ibid.489 Ibid.490Deloitte.(n.d.).AddressingAfrica’sinfrastructure

challenge.[Online].Availableat:http://www2.deloitte.com/content/dam/Deloitte/global/Documents/Energy-and-Resources/dttl-er-africasinfrastructure-08082013.pdf.Accessedon26June2014.



493 Mwilima,N.(2003).ForeigndirectinvestmentinAfrica.AfricaLabourResearchNetwork:LabourResourceandResearchInstitute.


495 ACB.(2012).AllianceforaGreenRevolutioninAfrica(AGRA)LayingthegroundworkforthecommercialisationofAfricanAgriculture.Johannesburg:AfricanCentreforBiosafety.

496AFSA.(2014).AFSAmakessmallgainsforfarmers’rightsinDraftSADCPVPProtocol.Briefingpaper.AllianceforfoodsovereigntyinAfrica.

497 Ibid.498 Ibid.4994-Traders.com.(2014).PioneerFoodGroup.[Online]..

Availableat:http://www.4-traders.com/PIONEER-FOOD-GROUP-LTD-6500189/company/.Accessedon29June2014.

500Business Day.(2014).AlcoholdistilleriestohelpIllovodiversify.[Online].Availableat:http://www.bdlive.co.za/business/agriculture/2014/05/27/alcohol-distilleries-to-help-illovo-diversify.Accessedon29June2014.

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