Farmer's Weekly (South Africa)
New industry body to give macadamias a competitive edge
The Southern African Macadamia Growers’ Association has undergone major changes, breaking away from Subtrop to become an independent entity and introducing statutory levies. Lindi Botha spoke to newly appointed CEO Lizel Pretorius about the association’s
What was behind the decision to break away from Subtrop and form an independent, nonprofit industry body?
The macadamia industry in South Africa has grown rapidly over the past few years. This has brought about a need for a fulltime team focusing specifically on macadamias to address potential challenges and explore opportunities, especially in research, market development and stakeholder communication. An evolution committee was established to guide the South African Macadamia Growers’ Association (SAMAC) breakaway from Subtrop and decide on its key objectives. The most important resolution to come out of the committee was to ensure that SAMAC was an independent organisation that could mitigate risk in the orchards and markets, and explore new opportunities to increase both demand and supply of macadamia nuts.
SAMAC’s main aim is to build and maintain a lean, profitable organisation. This will require sound financial governance and administration, driven by benchmarking remuneration levels and policies, and by evaluating performance annually. To increase efficiency, the board has been reduced from 13 to six directors, plus the
CEO. They have been assigned portfolios that align with their specific skill sets.
The idea of forming a non-profit company was not anticipated initially, but we wanted to ensure better corporate governance and transparency for our members, particularly as our funding would increase significantly in the near future with the renewal of the statutory levy.
Delivering value for the levies is paramount. This includes ensuring that growers have access to the latest research on macadamia production; investigating new technologies to assist farmers; representing South Africa on the global stage, thus ensuring the country remains the supplier of choice for macadamia nuts; and utilising all opportunities to open new markets.
What are the main hurdles and how will SAMAC tackle them?
Our biggest hurdle was to obtain approval for the increase in the statutory levy. This has been overcome and we’re excited that the return on investment for growers will be significantly improved. As of this month, the levy will increase from 23c/kg dry nut-in-shell (DNIS) to 50c/kg DNIS. With the added income, we can focus on several pressing issues. More than 50% of the budget will be allocated to research and development (R&D), 20% to transformation, 16% to director and employee expenses, and 13% to administrative and travel expenses.
the growth of the industry led to the need for a full- time team
What will be your priority areas for the coming season?
Our new strategy focuses on six pillars, all of which are crucial in the year ahead. They are: R&D, transformation, communication with growers, maintaining South Africa’s competitive advantage in macadamias, improving relations with government, and building a professional organisation.
R&D is of fundamental importance to any industry association, which is why such a large portion of the income will be spent to secure the future production of macadamias in South Africa. Research will be conducted in two areas: pest and disease control, and health studies to assist with maintaining macadamias’ competitiveness.
With regard to the former, most of the research will focus on controlling stinkbug, reducing November nut drop, breeding cultivars, and managing nut borer.
Transformation activities will be centred on identifying and establishing viable black commercial farmers. We’ll also be looking for funding partners to ensure the success of our projects. The National Agricultural Marketing Council provides the guidelines on
transformation activities, and the levy will be dedicated to achieving these targets.
A new transformation committee will drive progress in this area, and we’ll be looking at small grower development and assisting commercial farmers with on-farm transformation. In this regard, SAMAC is considering providing transformation ‘toolkits’ to help farmers.
We intend keeping our growers informed through our communication strategy, which focuses on two-way communication. A SAMAC app will be under development from next quarter; this will ensure regular communication on industry updates, pest alerts, crop spraying and industry meetings. Social media will play a role, and an annual magazine will be distributed among members.
SAMAC’s commercial aim is to maintain South Africa’s competitive advantage in this crop, increase demand, and improve market access for macadamia nuts.
Improving government relations and building a professional, transparent organisation are also priorities.
What are SAMAC’s plans to ensure a sustainable market for macadamias amid exponential industry growth?
We’ll be working closely with handlers to ensure we channel marketing efforts in the right direction. Research proving the health benefits of eating macadamias will also assist in increasing demand.
Market development in terms of reducing import tariffs and increasing demand in current and new markets will receive attention. We’ll be using events such as the International Macadamia Symposium in Lincang in China as a platform to continue engagements on reducing China’s import duty. The South African government is a key partner in this process and we’ll also be engaging with them.
What will be the focus of your dealings with government?
We want to establish a close relationship with government because we need them as a partner in a range of activities. These include assisting with market development initiatives, decreasing import tariffs, registering chemical products, being funding partners in research and transformation projects, and curbing theft of macadamias.
It’s vital to ensure greater market access to key countries, particularly by keeping import duties at competitive levels due to competition from Australia, whose nuts often carry no duties. Furthermore, we need to ensure goodwill for long-term legislation that supports the industry.
We’ll also focus on implementing a minimum quality standard for macadamias to ensure the sustainability of the industry and South Africa’s reputation as a quality nut supplier. South Africa’s and Australia’s quality is far superior to those of other countries, yet we have to compete with them on price.
It’s important to establish an international standard to ensure that buyers receive quality nuts and consumers always have a positive experience. The market could be damaged if poorquality macadamias are sold.
• Email Lizel Pretorius at lizel@samac.co.za.