Agri-podcast: Fuel price to affect farmers
11:27 Tue, 02 Apr 2019
Agri-podcast: Fuel price to affect farmers | News Article
The fuel hike expected from Wednesday will have a severe impact on the cash flow of farmers, warned head of economics and trade at Agric SA, Dr Requier Wait.


He says petrol and diesel are used for plowing, harvesting, machinery and transportation, making them critical components for both emerging and commercial farmers across the country. Wait says that the increase in the diesel price would have a negative impact on food inflation and income of consumers, who are already struggling to make ends meet. He adds the imminent hike in fuel prices was of concern because it is an important cost for farmers. Wait says the increase lowers the margin they can earn on their produce. He also says rising diesel prices must be taken as part of a changing cost structure and it directly impacts on farming margins. Wait says the good news is that farmers who use diesels could claim refunds back if they qualify according to legislation.


Farmers in South Africa owe commercial banks a whopping R160 billion. This is according Prof Sanlie Middelberg of North-West University’s School of Accounting Sciences in Potchefstroom. Middelberg  told Farmers Weekly this week that many farmers were unable to repay their loans due to failed harvests, ever-increasing input costs, and low livestock prices. She says commercial banks in South Africa face enormous credit risks due to agricultural producers defaulting on loans and being increasingly unable to provide security for loans. According to Middelberg, banks operated in a strict regulatory environment and re-insured their loan books by using the collateral provided by farmers as security. If the drought continued and farmers kept exiting the sector, it could seriously affect food security in South Africa.


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Glen Agricultural College Principal Melvin Makangu, says it’s all system go for the much anticipated graduation ceremony that will be held at IPJ Du Plessis hall on Friday morning. About 40 students from all corners of the province are scheduled to graduate in various sectors of agriculture. Makangu says what makes this year’s ceremony special is that the college is also celebrating its centenary this year. He says they will also be honouring several employees who have worked for the college for over 30 years.  Makangu says they are particularly ecstatic that they will be bestowing the MEC of Agriculture and Rural Development Dr Benny Malakoane with an honorary Diploma in agriculture. Makangu adds that the college was established in 1919 and has served as a centre of excellence in agricultural training in and around the Free State Province for a century - this should be celebrated in style. The ceremony, that is expected to be attended by top brass of the Provencal government including the premier Sisi Ntombela, is scheduled to start at 10am.


OFM News/Michael Tlhakudi


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