• BEE NEWS

Tongaat Hulett creating new stability for emerging farmers ahead of exit from SA sugarcane farming

NORTHCOAST COURIER / 09 OCTOBER 2019 - 15.47 / STAFF REPORTER

As the company embarks on a turnaround process which involves an exit from its sugarcane farming operations in South Africa, previously disadvantaged individuals will be stepping in to fill in the gap.

Agri-processing giant, Tongaat Hulett last Wednesday announced the establishment of FarmCo, a transformation initiative to ensure that land which has been targeted for future property development remains productive under sugarcane.

The Dynamic trio: Khetha Ncalane, Nonhlanhla Gumede and Khumbulani Mthethwa have been selected to be at the helm of Uzinzo Sugar Farming initiative.

As the company embarks on a turnaround process which involves an exit from its sugarcane farming operations in South Africa, previously disadvantaged individuals will be stepping in to fill in the gap.

Tongaat’s sugar operations currently encompass 119 000 hectares, of which 8 400 hectares are owned and farmed by Tongaat, 61 500 hectares are owned and farmed by white commercial farmers and 49 300 hectares are owned and farmed by previously disadvantaged individuals (PDIs).

Tongaat Hulett’s aspiration is to shift the PDI supply mix towards a 50 percent share.

The company said numerous farms will transition through creating opportunities for third party growers to farm company owned land thereby reducing potential job losses at the farm level.

Phase one of FarmCo is set to meet the Agri-BEE scorecard objectives including equity and ownership profiles, through the creation of a large-scale black-owned sugarcane farming enterprise.

The initiative will also reduce the impact of retrenchment through employee empowerment, focus only on the estates that have the highest agronomic potential and maintain full economies of size and scale of estates.

In addition, FarmCo is set to encourage youth participation and ensure meaningful participation of black farmers within the sugar industry.

To make the transformation initiative a reality, Tongaat Hulett facilitated the creation of Uzinzo Sugar Farming, which means stability in isiZulu.

Uzinzo will enable shareholders to lease three prime agricultural estates at below market-related rental.

The leased area is about 3 900 hectares with an estimated annual production of 160 000 tons of sugarcane, making Uzinzo Sugar Farming one of Tongaat Hulett’s top five largest supplying growers.

The three farms extend over both coastal and the Midlands regions, growing different variants of cane, some of which are harvested annually and other crops every second year. Farming will also include food crops.

Uzinzo’s annual revenue is expected to be around R79 million, which together with its scale of production, will make it the first broad-based agricultural company to feature among the largest 10 sugarcane farmers in KwaZulu-Natal.

Three dynamic individuals from the North Coast, Nonhlanhla Gumede (33), Khetha Ncalane (45) and Khumbulani Mthethwa (44) have been selected to be at the helm of Uzinzo Sugar Farming.

These individuals have a 65 percent shareholding. There is also a 15 percent shareholding for the employees through an employee trust.

Tongaat Hulett, which will retain a 20 percent shareholding, will play a facilitative and mentorship role in the short-term.

Nonhlanhla has nine years experience within the agricultural sector. She spent a short period at the start of her career within the banking sector.

-------

LINK : https://northcoastcourier.co.za/140567/creating-new-stability-for-emerging-farmers/

Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER

9 views

© 2019 BEE Chamber (PTY) Ltd, All Rights Reserved