The Future of Agriculture in South Africa
The Serlaff Cooperative stands to serve as the benchmark of what existing farmers and the agricultural community can do to successfully assist emerging farmers in South Africa. Through such projects the Sernick Group hopes to sustainably uplift communities, empower emerging farmers and stabilise both local and foreign perception of the agricultural landscape within the country’s current political climate.
The Sernick Serlaff partnership was established by the Sernick Group in 2016 through their Emerging Farmers Programme. The primary co-op consisted of 59 black emerging farmers; the motivation for the co-op emerged from a growing demand to assist emerging farmers with access to the market as well as training, development and assistance in the transition to commercial farming.
In their first year Serlaff was granted a R25 million loan from the Land Bank through Sernick’s Wholesale Funding Facility (WFF) and in 2017 the tranche was increased to R50 million. In 2016 the drought caused feed prices to skyrocket and as a result Serlaff made a loss of ± R589 000. However, the loan was repaid in full to the Land Bank within the year and valuable lessons were learnt during this time. In 2017 the Serlaff Co-op made a profit of ± R2,1 million. Recognising the loss made in the first year, a total of R1,5 million was paid out to the Serlaff Co-op after the second loan was repaid in full to the Land Bank.
The loan was used to acquire weaners for the Serlaff Co-op. The weaners entered a custom feeding programme at the Sernick Feedlot in Edenville with active participation from the Serlaff members. The feeding programme consisted of one-month background feeding in the veld at Sernick where they receive their first rations of feed to grow accustomed to the feed that they would receive in the feedlot. After backgrounding they were placed in the feedlot for at least five months or more to reach their maximum growth after which they were sold to the abattoir to be slaughtered.
Sernick recognises the importance of assisting emerging farmers in South Africa, from both an economic and social perspective. “These farmers are our future. One day they will be our clients and we would like to do everything in our power to assist them and help them succeed. Their success is our success,” says Nick Serfontein, chairman of the Sernick Group.
A core group of Serlaff farmers were trained at the Sernick farm through Sernick’s Emerging Farmers Programme whilst also attending and participating in regular farmers’ information days and annual carcass competitions. At the recent annual auction of Sernick on 1 June, Serlaff bought 42 pregnant cows and calves (3 in 1) to bolster their breeding stock as a Co-op. The total cost of this investment by Serlaff was R1,439 000. These cows and calves are currently housed on Serlaff members’ land for which they will be paid rent by Serlaff Co-op. The expected annual profit on this investment will be ± R50,000 per annum.
This success story has formed the model on which the successful Sernick Application to the Jobs Fund through National Treasury was made. Now some 300 emerging farmers will benefit from custom feeding in the next three years. Through this programme Sernick will assist 660 existing emerging farmers to grow into commercial farmers which will take place over a longer period of time. A Revolving Fund was created to ensure that the fund assist as many farmers as possible and the Sernick Group hopes to create over 1,400 jobs over the next three years.
“This has been a great experience for the farmers of Serlaff and it has supported us to become better farmers with improved access to the market. It’s our wish that the farmers in the Jobs Fund Programme will reap the same benefits as Serlaff,” said Reuben Maphira the chairman of Serlaff.
About the Sernick Group:
Sernick, founded in 1982, is a diversified organization with its focus on agriculture and agricultural processing activities, including a Bonsmara stud, commercial Bonsmara herd, a Phase C bull testing station, animal feed production (Sernick Animal Feeds), feedlot, red meat production (Sernick Country Meat abattoir, de-boning and processing) as well as retail outlets (Country Meat) and restaurants (The Braai Room). Sernick is based in and near Kroonstad in the Free-state province of South Africa and consists of 7 business entities, each adding value to the group. The group employs more than 500 people with annual revenues of R 1,2 Billion.