South Africa Seeks to Move Corn Belt as Coal Gobbles Land

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South Africa’s biggest grains lobby said a lack of title deeds in the nation’s poorest province is hindering a plan to move the corn belt west as coal mines take over some of the best land for crops.

South Africa, the world’s biggest white-corn producer after Mexico, wants to raise annual output in the Eastern Cape ninefold to 1 million metric tons by 2018 as coal mining renders land unsuitable for farming in the eastern province of Mpumalanga, the Bureau for Food and Agricultural Policy said in a report.

Mpumalanga, which usually ranks second to the Free State for corn output, is also the province where about 80 percent of the nation’s coal is mined. The Eastern Cape is the second-smallest producer of the country’s nine provinces, contributing less than 1 percent to last year’s harvest.

“We’re losing a lot of good agricultural land, the best, in Mpumalanga because of the coal mines,” Jannie de Villiers, chief executive officer of Grain SA, said in an interview in Bloomberg’s Johannesburg office.

New farmers in the Eastern Cape are struggling to access finance because they don’t hold title deeds to swathes of communal land that belongs to local ethnic groups. The province is the least economically developed, the South African Institute of Race Relations said in a January report.

No Tenure

Newcomers to farming in the Eastern Cape “are doing it well, but they’re doing it on small pieces of commercial land and they cannot expand because they don’t have the finance,” De Villiers said. “It is communal land -- there’s no tenure, no security, no loans.”

About 46 percent of South Africa’s best agricultural land, or fertile soils, is found in Mpumalanga, 12 percent of which will be unsuitable for farming due to mining, the report showed. The usability of another 14 percent of the best-quality land is under threat because of prospecting, it said.

“Communal land rights have been exercised for centuries by traditional communities” in South Africa’s rural areas, where more than a third of the country’s 54 million people reside, Gerrit Pienaar, a law professor at the North-West University, wrote in the October 2013 edition of the journal of the Helen Suzman Foundation. “These rights are not individualized, and may not be registered at present.”

Corn Imports

Developing farms in the Eastern Cape, where Grain SA has about 2,000 members out of more than 7,000 countrywide, is favorable because it has good rainfall, stable production, and can generate high yields, De Villiers said.

South Africa is importing corn for the first time in 11 months as the worst drought since 1992 destroyed crops in the continent’s biggest producer. The dry weather has damaged crops in the Free State and North West provinces, which accounted for 64 percent of output in 2014.

The local price of the white variety, a staple food, fell 1.5 percent to 2,575 rand ($215) a ton by midday in Johannesburg, paring the gain this year to 20 percent. The yellow type, used mainly as animal feed, declined 1.1 percent to 2,370 rand a ton, trimming the increase this year to 9.5 percent.

The government-convened Crop Estimates Committee predicts a total harvest of 9.67 million tons this year, the smallest since 2007. Last year’s intake of 14.3 million tons was the largest in 33 years.

“If we want to maintain our food security and have a surplus of maize, we need to start producing in the Eastern Cape,” De Villiers said, using the local term for corn.

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