Agriculture

2.     (a)  One of the key ingredients of the international competitiveness of the Western Cape Agricultural Sector is the sanctity of the cold chain for fresh produce.  Once the product has been received in the packing facility, the temperature of the product is not allowed to move beyond very specific tolerance levels until it is purchased by the consumer.  Indeed, temperatures are monitored and recorded throughout the value chain and is available to all participants throughout the process.  Any discrepancy will lead to the rejection of a whole consignment.  It follows that loadshedding does not only lead to physical disruptions and inconveniencies during value adding (e.g. stopping sorting machines, interrupting processes, cleaning jam pots, time to stop or start processes, etc.), but will inevitably undermine the quality of products and international competitiveness of the Sector. 

The impact is not only limited to agri-processing and value adding, but also on food production itself.  Of concern is that irrigation systems will not be able to cope with water demand needs of plants during summer months given loadshedding at levels four and above.  Irrigation systems were just not designed to provide enough water to plants when daytime temperatures approach 40°C and loadshedding means that the system cannot operate for eight or more hours per day.  Hence, the implication is that, other than during Covid-19, the very resources (i.e. orchards, vineyards, etc.) of production may be damaged as a result of loadshedding.  Keep in mind that there are currently 181 233 hectares planted to permanent crops in the Western Cape Province and that the replacement value of these permanent plantings can conservatively calculated at R60,8 billion (i.e. to replace something we already have). 

It follows that:

• The destruction of the production capacity will lead to food shortages.  This, in turn, will lead to higher prices, household food insecurity and social unrest.
• The Western Cape is now in the summer months and the highest temperatures are expected in January and February.  If the summer of the Northern Hemisphere is anything to go by, then record temperatures will probably be recorded.
• The harvesting season for stone fruit is in full swing and that for pome fruit and grapes are just starting.  It follows that any disruption in energy supply will have a major impact on the quality of the harvest as well as the whole cold chain.
• At an agri processing facility the downtime is not only equal to the load shedding period, but certain processes have to be completed in totality.  For instance, a pot of jam or a batch of bread has to completed without interruption with the result that the time between scheduled load shedding events determine the production schedule.  Hence, if there are only four hours between load shedding events, the maximum process which can be implemented (including start-up and cleaning afterwards) cannot exceed four hours.

2. (i) Up do date no support has been forthcoming from National Government

(ii) Although no financial interventions have been provided at provincial level, the Western Cape Department of Agriculture did engage the Sector in order to identify the true impact of load shedding on the Sector.  As a result of this engagement two research projects is in the process of being commissioned with the one focussing on macro level impacts and the other on the on-farm implications of load shedding.  The results from these projects will be used to engage Eskom and other spheres of government to create a more manageable energy environment for the Sector.

3. (i) During the engagements with representatives from the Agricultural and Agri-Processing Sector, industry role-players indicated that farming can continue up to stage 3 of load shedding, but not after that.  On the value adding side packaging and cold storage cannot continue after level 1.  Although on-farm electricity generation (by using diesel generators) is possible, it's cost is prohibitive; whereas the average Ceres farm has an electricity bill of R400 000 per month, the energy bill is over R1 million per month at stage 2 load shedding if diesel is to be used to generate electricity. 

(ii) From the above it can be deducted that continuous load shedding at stages 6 and higher will have a devastating effect on farming and that it will undermine the competitiveness and the long term sustainability of the Sector.