Categorized | Business, Skills development

BEE scheme bucks the trend in agriculture

ALGNew entrants in the agricultural sector find it hard to survive, especially when they are previously disadvantaged individuals.  That is not the case with a Western Cape based citrus project in Upper Olifants River Valley near Citrusdal. Cedar Citrus (Pty) Ltd a BEE citrus export company established in 1999 with the assistance of a start-up loan from the Industrial Development Corporation, which has now been paid off. In 2015 the company exported 1500 tons of citrus from their production unit of 36 hectares realizing a total turnover of R12 million for the year.

Cedar Citrus is a joint venture between 32 farm workers and ALG Estates their employer, with each party owning 50% of the company. In their next move towards more financial independence the workers jointly decided to plough back their profits and extended their operations by purchasing additional farmland to plant more citrus for the export market. “Constant mentorship combined with in-house training and being part of an established value-adding export chain are the necessary ingredients for success in an operation such as this,” says Gerrit van der Merwe, CEO of ALG Estates, a family operation of 6 farms producing some 18,000 tons of citrus a year mostly for the export market.

“Over the last few years the Cedar Citrus patch of 36 hectares coincidentally turned out to be the most lucrative of all the production units on our six farms.  They produce mostly popular soft citrus varieties such as Morr and Orr as well as navels, which are exported to North America, Europe and sold locally to the Woolworths supermarket chain. We are especially pleased that the 32 shareholders of Cedar Citrus jointly decided to waive their profit pay-outs from the company and rather re-invest it in the expansion of their own operation,” says Van der Merwe.

The Western Cape government awarded Cedar Citrus’ good performance over the years with inter alia a sprayer, 4 crate wagons, a trailer and recently a brand new John Deer tractor.  “Cedar Citrus is one of the best performing projects of its kind in South Africa and the envy of many farmers country-wide. Not only is the project a financial success, richly compensating the beneficiaries, but a very good example of how BEE schemes should be implemented and managed in South Africa. Congratulations to Gerrit and his team at ALG Estates on this beautiful project,” says Charl Senekal, the country’s largest private sugar producer and chairman of Pro-Agri Forum the exclusive club of former South African winners of the Farmer of the Year Award.

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