Developments in the grain industry Click to edit Master text styles - PowerPoint PPT Presentation

Click to edit Master title style Developments in the grain industry • Click to edit Master text styles • Second level Agbiz Media Day • Third level • Fourth level 25 November 2016 • Fifth level 11/25/2016 1

Developments: Click to edit Master title style Wheat In Industry ry • Click to edit Master text styles • Second level • Revival of the Wheat Industry • Third level • Statutory Levies on Wheat • Fourth level • Fifth level • Breeding & Technology Levy System • Relaxation of wheat cultivar release requirements • JSE Guaranteed grade for Wheat • Wheat Indaba 11/25/2016 2

Developments: Revival of f the Wheat In Industry ry Click to edit Master title style PROBLEM STATEMENT • New seed companies do not enter the market because of the lack of • Click to edit Master text styles returns on investment due to farm-saved seed. • Second level • South Africa is thus denied new seed technology which is available to • Third level our international competitors • Fourth level • Fifth level 2012 Funding for seed breeding • Find a sustainable and effective research funding model • Propose a breeding & technology levy based on end point royalty (EPR) 2014 Revitalisation of the Wheat industry • Find ways to turn around the decline of the wheat industry • Participate in DAFF Value Chain Round Table for Wheat 11/25/2016 3

Developments: Statutory ry Levies on Wheat Click to edit Master title style • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 11/25/2016 4

Developments: Statutory ry Levies on Wheat Click to edit Master title style • Click to edit Master text styles • Second level • Third level Breeding & Technology Levy • Fourth level • Fifth level NAMC / LEVY MINISTERIAL AMOUNT COLLECT ADMIN COMMENTS APPROVAL & PERIOD Two (2) levy Effective 1 October 2016 applications: Industry levy R10 – 4 yrs WCT WCT Release criteria relaxed for yield Breeding levy R25 – 2 yrs SACTA SACTA Not acceptable to NCM & SACB 11/25/2016 5

Developments: Breeding & Technology Levy vy System Click to edit Master title style SA Cultivar & Technology Agency • Click to edit Master text styles • Levy on all open-pollinated crops • Second level • SACTA MOI & Board Directors (Grain SA, SANSOR & Agbiz Grain) • Third level • 2.5% fee for levy collection (Agbiz Grain members) • Fourth level • Fifth level Levy on wheat • Seed licensing and royalties: - commercial certified seed multiplied, cleaned and supplied to producers. Has no bearing on SACTA BTL - farm saved seed retained by farmers, cleaned and planted. This royalty will be forgone; SACTA levy replaces this Levy on soybean (formula = 1% for germplasm & 0,5% for existing technology) 11/25/2016 6

Developments: Relaxation of f wheat cult ltivar release Click to edit Master title style requirements • Click to edit Master text styles Criteria should have a healthy balance between yield and quality. • Second level • Third level Driven by the free market, dictated by demand. • Fourth level • Fifth level For the last 20 years: • Breeding focus – quality only. Threatening survival of local wheat industry. • Release criteria excluded yield & denied producers any incentive/benefits by producing higher yielding wheat crops. • High quality South African wheat - upgrade the low quality imported wheat. • Quality - entry barrier for new entrants into breeding. 11/25/2016 7

Developments: Click to edit Master title style JSE Guaranteed grade for r Wheat • Agbiz Grain members agreed to individually make available to the • Click to edit Master text styles market, minimum quality guaranteed silo receipts. • Second level • New JSE Silo Certificate with a Guaranteed Grade (GG). • Third level • Fourth level • The JSE also approved the concept and will implement such in 2017. • Fifth level • GG contract structured in such a way as to allow every service provider to complete the essential elements of the agreement (cost, volume constraints, application procedure, duration, transferability, grade etc.) in line with their own preference. • Local processors will appreciate the grade guarantees • Local wheat price expected to receive support in the cash market compared with relevant import parity level. 11/25/2016 8

Developments: Click to edit Master title style Wheat In Indaba • Agbiz Grain event for all role players in the wheat industry, • Click to edit Master text styles upstream and downstream, to communicate the changes • Second level • Third level that have been implemented to revive the wheat industry. • Fourth level • Fifth level • There will be one event in Pretoria and one in the Western Cape as follows:  Friday, 17 February 2017 – Grain Building, Pretoria  Tuesday, 21 February 2017 – Elsenburg 11/25/2016 9

Click to edit Master title style THANK YOU • Click to edit Master text styles • Second level Mariana Purnell • Third level • Fourth level • Fifth level mariana.purnell@agbizgrain.co.za www.agbizgrain.co.za www.agbiz.co.za @AgriChamber 11/25/2016 10