Alltech is a good example of a company that is committed to the people and I am aware of your contribution, not only to the economy, but also through your involvement in projects within this community where you run your business from. I want to thank you for that. Your involvement in agriculture through research and development of natural nutritional solutions for the animal feed industry must make a difference to the Agricultural Industry.

Well over half of the country's agricultural exports originate from the Western Cape. The Western Cape's two most important export products (wine and fruit) are indelibly linked to the agricultural sector. A third (hides, skins and leather), are an extremely important product, originating from the extensive rural areas of the province. It is also clear that these industries are still on a strong growth curve with especially the wine industry being an unqualified success. While the volume increased from 23 million litres in 1991 to 217 million litres in 2002, the value increased even more rapidly.

When moving closer to home and into your field of expertise, we see that with 505 000 head of cattle in 1999, the Western Cape accounts for just 3,7% of the national herd, although its 3,5 million sheep make up more substantial 12%. The region also has 227 000 pigs (14,8%) and 243 000 goats (3,8%). The industry is either extensive and field-based (cattle and sheep) or intensive and based on grain feeds (poultry and pigs). While demand for red meat has declined, demand for pork and poultry has risen strongly.

South Africa is home to 70% of the world's 495 000 commercial ostriches (2003). The Western Cape, in turn, hosts 75% of South Africa's flock. Although the global flock decreased to the current levels from 750 000 in 1996, it is clear that the industry has reached its turning point. South Africa is re-establishing itself as the global leader in this industry with 72% of slaughtering and trade. Although leather was in the past major contributor to producer income, ostrich meat is growing in importance due to its unique qualities.

The Western Cape broiler industry produces some 135 000 tons annually, accounting for over 17% of national production, which is worth almost R6 bn at producer level. The region is home to the country's third largest broiler player, County Fair, as well as its largest egg producer, Nulaid. The Western Cape produces about 20% of the country's annual total of 4,6 billion eggs.

The dairy industry is the fourth largest agricultural industry in South Africa, representing 5.6% of the gross value of all agricultural production. The 1 267 milk producers in the Western Cape produced 500 million litres of milk in 1999, with a total value at producer level of R545 million.

Milk is bought and processed by over 300 processors and manufacturers, while some 500-producer distributors also market liquid milk and fresh dairy products. Large dairy companies represent a very small percentage of all processors but process over 80% of the total milk delivered to dairies, producing a large range of mainly commodity dairy products. There are also numerous small operations processing less than 2000 litres of milk a day, often supplying on a regional basis.

We need to grow the whole animal component of the Agricultural industry in the Western Cape, therefore we need to find innovative means to enhance the industry and to assist small farmers in particular.

In conclusion the prosperity of the agricultural sector is linked to the extent to which primary production is aligned to the needs of the economy, both in terms of direct consumption of primary commodities and the demand for agricultural raw materials at the manufacturing level. It is important therefore that the vision for agriculture is seen in a broader view of the larger economy rather than a narrow focus on primary agricultural production. The social and business partners should strive to ensure that agriculture in the Western Cape can:

a) Contribute to economic stability, development and growth for the benefit of all as the backbone of a thriving rural and provincial economy;
b) Play a harmonious part in the natural beauty and environmental stability of our landscape;
c) Help to foster reconciliation, equitable transformation and stability, which is the mainstream of a vibrant civil society and contributes to a safe and secure rural life; and
d) Produce foods and fibres that enhance the living conditions of consumers.

Together we need to inspire excitement, vibrancy and address issues such as (i) global competitiveness (ii) enhancing people's quality of life (iii) transformation (iv) access and participation (v) adding value and (vi) attracting more investment. Our common vision should guarantee sustained participation in the South African agricultural economy by all stakeholders that recognise the need to maintain and increase commercial production, to build international competitiveness and to address the historical legacies and biases that restricted the growth and development of agriculture.

I want to wish you everything of the best with this venture and trust that you will reap the rich fruits of success on your investment in the Western Cape.

Enquiries: Alie van Jaarsveld
Cell: 084 6046701