R300m citrus scheme to boost workers

THE Sundays River Citrus Company is poised to launch what is potentially the country’s largest-ever black economic empowerment project in the agricultural sector when it invests about R300-million into a massive citrus farm.

The company, based in Addo and South Africa’s largest exporter of citrus, is a step closer to implementing its Ikamva Lethu Farm project, which is expected to create 800 new permanent and seasonal jobs.

The development follows the project having been awarded a 20-year water licence last month, a step critical to its success.

The project was started in earnest when the company purchased 1 200ha of land – of which 675ha is licensed for irrigation – for R15-million from an Addo farmer last year.

The scheme, in which Sundays River Valley workers and packers will have a 60% shareholding, will see the establishment of one of the region’s largest citrus farms.

The income will be put into a trust, with the farm owners and their workers benefiting financially from the first harvest.

A condition of the project is that the empowerment shareholding in the farm’s operating company, Ikamva Lethu, may not fall below 59% at any given time.

This was laid down by the Department of Water Affairs and Sanitation which issued the water licence.

The next phase of the project will involve an environmental impact assessment (EIA), which is expected to be followed by the construction of infrastructure, such as pipelines and dams, in 2018.

But this will only be done once an EIA has been conducted.

The 75 000 trees needed for the scheme will be planted in the spring of 2019, with harvesting scheduled for 2023.

Ikamva Lethu beneficiaries will be permanent farm workers in the area who work off-site on other farms, while new jobs will be created on Ikamva Lethu.

Citrus company transformation and development director Ken Nieuwenhuizen said with 150 citrus farms already in the valley covering 12 000ha, the Ikamva Lethu project could be the largest of its kind.

“We are looking at possibly the largest empowerment deal in the citrus industry in the country – and one of the biggest farming enterprises in the valley when it is fully realised,” he said.

Nieuwenhuizen said the citrus company had been guided by the National Development Plan (NDP) and the project was very broad-based.

“It’s about inclusivity and participation,” he said.

“It will result in about 400 community members becoming shareholders and beneficiaries.” The project will enable stake-

It will result in about 400 community members getting shares

holders to buy shares in the project, equivalent to up to 20% of their own farming enterprise, with half of the shares going to the farmer and the other half shared with permanent workers.

Permanent citrus company packhouse workers are also included.

Nieuwenhuizen said this meant that if a farmer had 100ha of land, he or she could invest 20ha into the new project.

The farm workers would not be required to pay anything.

The investments would, in turn, provide capital for the project rollout, as the land needed to be developed.

“Development costs are around R200-million, including the establishment of the farm and providing equipment,” he said.

“Provisionally, the plan is that the company will have a 5.5% shareholding and will support the Ikamva Lethu farming business, with 60% of the shares belonging to permanently employed previously disadvantaged farm workers living and working on farms in the valley, as well as the future Ikamva Lethu farm workers and company packhouse workers. The remaining 34.5% of shares will be held by participating citrus growers [farmers].”

Nieuwenhuizen said precise details were still being ironed out.

The project was already provisionally fully subscribed, with more than 35 farmers having indicated they intended to buy shares.

But the farmers did not want to share details of farm workers who would benefit from the project.

Charlie Miller, 66, who has been farming citrus in the Sundays River Valley since 1978 and owns Penny Home Farm, said he would buy shares in the scheme for his permanent workers.

“It is wonderful to be able to give back to the community,” he said, adding that some of his farm workers had been with him from the start.

Charl Tibshraeny, 46, who owns the Tibshraeny Citrus Enterprises, said the reason he would invest was that his 25 permanent workers would reap the benefits of the scheme.

“I like the whole concept and it will benefit a lot of workers,” he said.

Sundays River Farming Trust production manager Jafta April, 44, said the scheme would benefit future generations. “I wish we were young to make the best of this opportunity – I wish this started when I was 20,” he said.

April has been a farm worker in the Sundays River Valley since 2001.

Citrus company operations manager Frikkie Olivier, who oversees various empowerment projects, said many other projects had failed to impart proper technical and financial support.

“Support has been a major stumbling block in empowerment deals in the agricultural sector which have not succeeded,” he said.