29 April 2021
A tale of survival
POTATOES SA has shared the story of how a Limpopo Province potato farmer, Johan Holtzhausen, contracted Covid-19 while overcoming trying to overcome the challenges his business encountered as Covid-19 restrictions meant minimal movement and higher costs from operating under such conditions.
When Covid-19 struck the country, Johan pulled out all the stops to protect his workforce against the pandemic. The staff of farming co-op Ortus Boerdery came from a 45 kilometres radius of the valley between Roosenekal and Steelpoort.
Unfortunately, he himself became the one to contract the coronavirus and was bed-ridden for at least three days, on oxygen, fearing for his life, and self-isolated from his next of kin.
"One of the biggest challenges was complying with safety measures in curbing infection through the movement of farm labourers. Thankfully, we live in an isolated environment where most of our permanent workers find themselves in a secluded situation. However, when it came to making use of temporary workers, things got trickier," he said in an interview.
Temps must be transported on a regular basis and because of social distancing, these costs doubled with two trips replacing every one and an hour added to travelling time.
"Where we used to provide transport for people from 7am, we started bringing them to work from about 4am. In addition, we had to scan them for possible symptoms. Of course, we also had to provide sanitiser and PPE gear – with the latter costing us an arm and a leg, due to the high demand coupled with hefty pricing at the onset of the pandemic. Eventually, the cost escalation forced us to suspend transport for temporary workers because we simply could not afford it alongside a minimum wage hike."
Another logistical aspect of last year’s lockdown, especially during the early stages of the outbreak, was the availability and accessibility of parts and agricultural necessities such as chemicals. The movement of ocean freight was affected by the delay of vessels calling at ports, a consequence of supply chain restrictions which is still the case.
The impact brought on by Covid-19 trade regulations subsequently led to an increase in import expenses. Of course, nothing can make up for the frustration linked to waiting for input material. Where a machine part in the past took three to four days before it became available, it now takes two weeks or more before it is delivered to a point where a farmer can fetch it.
So how was his production affected by the virus?
"Essentially, we are potato seed producers, meaning we provide seed potatoes to both seed and commercial growers. However, depending on the cultivar, it is either produced under contract or to be sold in the open market. With regards to the open market, we are solely responsible to ensure that all product produced, gets sold. Within the Covid climate, where the impact of change is rapid, this can be a risky position in the market," he said.
"At this stage, the cultivars we produce are processing varieties that are grown on a contract basis. As a result, we fell back on contract production work to guarantee we remain sustainable.
"This adjustment in strategic operations can be ascribed to the pandemic, which necessitated that we evaluate and re-think – how to secure our position in the market. As a result, we fell back on contract work to guarantee that what we produce is taken up.
"In today’s climate, production costs have increased to the extent that as a producer you need to build market intelligence that will inform wise farm to fork decisions."
The potato industry in South Africa has 16 production regions that go to market at different times of the year. For the Eastern and Western Free State, marketing season commences in February. These regions marketed potatoes under extremely strained conditions in 2020.
South Africa has a diversified route to market in respect of its product offering which is supplied to fresh produce markets, formal and informal sector as well as the export market. National fresh produce markets remain the biggest seller of fresh produce in South Africa, however, with Covid-19, industry observed supply chain disruptions, with a reported 20% of stock trading occurring more direct.
The pandemic has created an atmosphere of uncertainty, where producers increasingly compete for alternative marketing avenues and secure distribution points. Moreover, it has fundamentally altered supply chain dynamics, according to Johan.
"For potatoes earmarked towards the processing industry, mainly servicing restaurants, hotels and fast-food outlets, Level 5 and 4 regulations did have an adverse impact. Operational costs such as transport, suddenly took on a different shape, due to travel regulations that imposed limits on the capacity of all modes of transportation. In our instance, travel costs per person increased from R29 - to an estimated R55 for every worker’s transport per day," he said.
"The issue of minimum wages was at the forefront of most agricultural news. As producers, we had a responsibility to absorb any financial knocks brought about by an increase in minimum wages. Contrary to market perceptions, the nature of our business prohibits us from passing these costs on to consumers."
Fortunately, there were no serious illnesses or deaths from Covid-19, and no serious impacts from pests or disease. The only thing they had to deal with in addition was above-average summer rainfall.
Apart from the pandemic’s impact, overhead costs such as Eskom’s rising electricity tariffs had to be included into cost calculations.
"Together with our labourers we remain resilient and believe that whatever challenges come our way also present us with new opportunities. When our permanent workers were asked at the beginning of the outbreak if they wanted to go home, they all, to the last man, preferred to stay on and see this thing through. It takes tremendous courage and conviction in one’s commitment to the task at hand. Working with such people is one of the reasons I love being a potato farmer," he said.
Source: Potatoes South Africa