Agribusiness Opportunities in Northern Provinces

Posted on Dec 9th, 2014
Agriculture Business Opportunities

Agribusiness opportunities in northern provincesThis week, we wrap-up our series of articles focusing on key agricultural business opportunities in each of the provinces in South Africa.

In the last of the series, we take a look at the key performing sectors in agriculture in the Northern Cape and Limpopo as found by the 2012 KPMG report, Research on the Performance of the Agricultural Sector.

Northern Cape
Occupying 36 million hectares, the Northern Cape is the largest province in the country, almost a third of South Africa’s total land area.

The province is a predominantly semi-arid region, prone to extreme temperatures.
The distribution of land in the province is indicative of the nature of agriculture production – a large livestock-farming sub-sector and intensive-irrigated cropping.

  • See also: Key agribusiness opportunities in the eastern coastal provinces 

Cattle and sheep farming are located predominantly in the southeast and northeast of the province while game farms tend to be spread through the middle. Sheep farming is the second-largest agricultural sector in the Northern Cape while 4% of all South Africa’s beef is produced in the province. Wool and mohair production are also strong industries in Northern Cape with 11% of South Africa’s wool and 7% of South Africa’s mohair.
Crop farming takes place mainly in the fertile areas along the Northern Cape’s main rivers, the Vaal and Orange rivers.

Below are some of the key crops produced in the province.

1. Table grapes
The Northern Cape is the second largest producer of table grapes in South Africa, producing 25% of the country’s table grape output. The grapes are exported predominantly to Europe and the United Kingdom.

2. Wine
The Base Orange River Wine Cellars Cooperative, the second largest
wine cooperative in the world with 740 wine-grape farmers and 445 juicegrape
famers, is located in the Northern Cape. It supplies mostly the local market.

3. Dried fruit
Northern Cape produces 4% of the world’s total dried vine fruit, and 90% of South Africa’s total dried vine fruit. Approximately 80% of raisins are exported to Europe, Japan, Taiwan, Korea, Canada and the United States.

4. Lucerne
This is one of the most important crops in the province at the climatic conditions are optimal for production of this high-quality hay.

  • See also: Key agribusiness opportunities in the Free State, Mpumalanga and North West

5. Field Crops
The province produces 18% of South Africa’s wheat. With approximately 55 000 hectares of land under maize production, Northern Cape also produces approximately 4.6% of South Africa’s maize, and approximately 20% of South Africa’s groundnuts.

Limpopo
Along with the Free State, Limpopo Province is also regarded as the country’s breadbasket and is one of South Africa’s most important agricultural regions and a significant producer of livestock, fruit and vegetables, the KPMG report states.

The report also states that more than 5000 large-scale commercial farmers farm 70% of the province’s agricultural land. There are an additional 303 000 small-scale farmers operating on the remaining 30% of agricultural land. The majority of these small-scale farmers have low levels of production technology, tend to have small farms averaging 1.5 hectares and are primarily subsistence farmers with small surpluses that can be taken to market.

The agriculture sector in Limpopo has faced severe challenges of severe droughts and floods in recent years, thus undermining the potential of the sector to contribute significantly to the provincial economy.

1. Horticulture crops
According to the report, the agriculture sector in Limpopo is dominated by horticulture. This includes fruit and vegetable farming, and there are abundant fields of avocados, mangoes, paw-paws, litchis and tomatoes, cotton and potatoes, with citrus and tea plantations prevalent in the central and northern areas, all accounting for 57% of total farming income in the province.

The main horticultural crops in Limpopo Province and percentage of national production set mangoes at 75%, paw paws 65%, citrus fruit 25%, litchis 25%, tomatoes 75%, macadamia nuts 54%, and avocadoes at 60%.

2. Field Crops
The smallholder farmers tend to grow predominantly field crops, particularly maize and on a smaller scale, grain sorghum, millet, beans and groundnuts.

3. Livestock
The livestock sector accounts for 25%. Livestock raising and hunting are carried out in the drier western and northern regions but several livestock farms have been converted to private game farms in recent years, mirroring a national trend, according to Brand South Africa.

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