Agro-processing in the R63 corridor (citrus)
A major shift in the international fresh produce industry has been the consolidation or rationalization of the number of suppliers to multinational supermarket chains. In the drive to reduce costs in the supply or value chain, the farmer will need to trade as directly as possible with the consumer. For example, the middleman who does not add value in the chain must be eliminated for the small farmer.
Small farmers will need to consolidate their supply and co-operate in packing and moving their product into the markets. An Agri-hub business model based on this new thinking is a way of maintaining sustainable prices for the producer as well as the consumer. To achieve financial sustainability, proper planning, co-ordination and continuity of supply and quality will need to be a "given". A consumer focus is a key to success in an already competitive global market.
The mechanisation unit
A subsector analysis study revealed a couple of opportunities in the citrus value chain. One of the recommendations from the study was the establishment of a mechanisation unit as a component of the agri-hub model to support farmers in Nkonkobe. The unit will be established as a shared facility for farmers in order to allow them to pool resources from government and at the same time provide other support services to local emerging farmers. The mechanisation unit will provide services such as land preparation, logistical support, handling facilities and even road maintenance to achieve higher levels of sustainability for merging farmers.
Aspire's enterprise development objective focuses on small scale agro-processors that can benefit from the link with mass commercial producers in the citrus sector. The link with established commercial producers will build on a resilient sector that has years of experience in the growing and management of the citrus production. Furthermore the established commercial farmers will bring marketing experience and ensure that small scale agro-processing enterprises secure a market share in the domestic and export markets. Furthermore agro-processing in the R63 consolidates economic activities across corridors thereby spreading the benefits across municipal boundaries. For example an agro-processing facility in the R63 processes berries from Sutterheim (Amahlathi LM) and Bedford (Nxuba LM).
Diversifying to achieve growth and spread benefits
The move towards a more diversified agricultural economy in the R63 has led to the cultivation of high value crops such as pomegranates, avocadoes and stone fruits. These crops also present downstream opportunities in the value chain in juicing, drying and packaging for both the domestic and international markets.