The lingering effects of drought

Whernit Dirks, the 2018 Toyota New Harvest winner, farms rooibos tea, wheat, pastoral grasses, sheep and barley in the Berg River region of the Western Cape. He spoke to Siyanda Sishuba.

How did your business, in particular, and the south african agriculture sector, in general, experience the trading environment in 2018? There is a misperception about profitability in the agriculture sector. People think it is a highly profitable business environment, but, in reality, margins are generally small due to the fact that the sector is a high-risk business environment that requires large capital input.

Some of the risks are not easily controllable, or can even be impossible to control, such as the weather. It will take a number of good seasons after the drought to really get production back to where we would like it to be.

Wh at challenges and opportunities does 2019 hold for your business?

We are operating in three industries, namely sheep, grain and rooibos tea. The best opportunities are currently in rooibos tea, and we are growing our interest and involvement in this industry. In terms of grain and sheep, the better weather conditions assisted us to rebuild our flock, as well as get back into our strategic rotation cycle and correct the balance between sheep and grain.

However, because of cash flow problems as a result of the drought, we missed out on the benefits of the good rainy season of 2018 by planting too late, and not planting the best varieties.

what are the biggest issues hampering the growth of agriculture in south africa?

My family and I love farming. It is all I want to do, but it is not easy, and certain critical factors such as economies of scale, participation in the value chain and the use of modern technology are crucial for commercial competitiveness.

If you’re successful in these critical factors, your agricultural business will, over the medium to long term, be rewarding.

• Email Whernit Dirks at genadeshoop@gmail.com.