Proposed multi-million Rand Agri-parks in Newcastle, Utrecht, and Dannhauser to boost economy

Can Newcastle, eMadlangeni (Utrecht), and Dannhauser expect major developments in the agricultural sector? This follows the Amajuba District Municipality’s plans to achieve its 2035 vision and see the three towns within its jurisdiction reach new heights.

The Amajuba District Municipality’s Integrated Development Plan emphasises the importance of agriculture in stimulating rural economies.

To support this, the Department of Rural Development and Land Reform (DRDLR), along with various other departments, has proposed establishing Agri-Parks (APs) in all rural district municipalities nationwide.

According to the IDP, these Agri-Parks will act as critical sites for providing intellectual and technical support for farmers, with a deliberate bias towards creating linkages between established and emerging farmers. Furthermore, the Amajuba DRDP is aimed at targeting specific sectors that will revitalise rural economies. As such, it is defined by sector-specific projects, thus acting as a critical platform for multisectoral programmes and projects.

Some of the key areas of intervention that the DRDP will focus on include the establishment of Agri-Parks (AP) as a means of stimulating rural economic growth. As explained in the Amajuba District Municipality’s IDP, an Agri-Park is defined as a networked innovation system of agro-production, processing, logistics, marketing, training and extension services located at a district level.

As a network, it enables a market-driven combination and integration of various agricultural activities and rural transformation services. The AP comprises three basic units:

1. The Farmer Production Support Unit (FPSU) – This is a rural outreach unit connected with the Agri-hub. The FPSU does primary collection, storage, processing for the local market, and extension services including mechanisation.

2. Agri-Hub Unit (AH) – This is a production, equipment hire, processing, packaging, logistics and training unit.

3. Rural Urban Market Centre Unit (RUMC) – The RUMC has three main purposes:

• Linking and contracting rural, urban and international markets through contracts.  
• Acts as a holding-facility, releasing produce to urban markets based on seasonal trends.
• Provides market intelligence and information feedback, to the AH and FPSU, using latest Information and communication technologies.

Furthermore, the Amajuba District Municipality explained that Agri-Parks, therefore, are catalytic sites for agrarian reform. Responding to the National Development Plan’s (NDP) call for rural economic transformation, as well as an emphasis on promoting food security through agrarian reform. Moreover, the Agri-Parks will act as agricultural industrial hubs.

These hubs will be linked to existing rural villages and towns, providing key institutional, financial and spatial mechanisms for harnessing agro-related value chain belts and functional regions. According to the District Municipality’s IDP, the government has set aside over R2 billion for kick-starting the Agri-Parks programme across the country.

The objectives of Agri-Parks are as follows:

Promote the skills of and support to small-holder farmers through the provision of capacity building, mentorship, farm infrastructure, extension services, production inputs and mechanisation inputs.

• Enable producer ownership of the majority of Agri-Parks equity (70%), with the state and commercial interests holding minority shares (30%).
• Bring under-utilised land (especially in Communal Areas Land and land reform farms) into full production over the next three years, and expand irrigated agriculture.
• Contribute to the achievement of the NDP’s objective of fostering an inclusive rural economy and target of 1 million jobs created in the agriculture sector through creating higher demand for raw agricultural produce, primary and ancillary inputs, as well as generating increased downstream economic activities in the sector.

As the Amajuba District Municipality looks at the establishment of Agri-Parks within the area, the IDP has further earmarked agricultural projects which would fall under its Local Economic Development (LED) District Growth and Development Plan (DGDP) Catalytic Projects, which are aimed to be potentially achieved by 2035.

The DGDP Strategic Goals for inclusive growth are as follows:

Hemp/Cannabis Production:

This project is set to look at the primary production and processing of hemp/cannabis within Newcastle, Dannhauser, and Utrecht. The required funding for this project is a staggering R100,000,000, with the proposed lead departments being the ADM, ADA, and the private sector. The beneficiaries of the project are aimed at emerging farmers within the district.

Amajuba Livestock Production Programme:

The project seeks to establish feedlots that would formalise livestock farming in the district and commercialise it. The IDP highlights that currently over 600,000 herds of cattle have been identified around the district. To take advantage of the abundant livestock in the district, the Amajuba District Municipality’s IDP notes that livestock production has been introduced to the local farmers.

This project is set to take place in Newcastle, Dannhauser, and eMadlangeni (Utrecht). The required funding for the project has been put at R10,000,000 with the Department of Agriculture, Land Reform and Rural Development (DAERD) being earmarked as the proposed lead department. If a successful production base can be formed on the project, the District Municipality noted, a meat deboning plant would be set up in the district to consume all the cattle from the feedlots established. The beneficiaries of this project are set to be emerging livestock farmers from the area.

Poultry Value Chain:

This project will look at the production of poultry and the value-adding chain. While the IDP has not identified where this will be set up, it did note it would be established within the Amajuba District with the required funding coming at R100,000,000.

The proposed lead departments would be the District Municipality (DM) and the DAERD. The District Municipality’s brief profile on the project highlighted that it would involve setting up incubators, poultry rearing houses, an abattoir, as well as cold storage and packaging.

Development of a Regional Market:

This project, which is planned to be established in Newcastle, will come with a price tag of R60,000,000 with the proposed lead departments being the Amajuba District Municipality (ADM) and the Department of Co-Operative Governance and Traditional Affairs. The project is aimed at establishing 200 jobs and providing a market for emerging farmers.

Grain Crop Production Programme:

This project focuses mainly on the production of grain crops (soya, maize, and dry beans). The District Municipality explained thousands of hectares of underutilised land have been acquired through restitution in the District, mainly within eMadlangeni (Utrecht).

With the project planned to take place in Utrecht, the required funding will involve approximately R20,000,000 for a minimum of 1,000 hectares. The beneficiaries of this project are aimed at emerging farmers within the district. During the land preparation and planting stages of the project, up to 15 permanent jobs and 50 temporary jobs would be created.

Vegetable Production Programme:

This initiative, which will focus on the production of vegetables by emerging farmers within Newcastle, Dannhauser, and Utrecht, will need the required funding of R5,000,000 with the proposed lead departments being the ADM and DAERD.

With the Amajuba District Municipality setting its sights on achieving these projects in the coming months and years, the IDP noted that there were critical success factors to take into consideration.

Therefore, it is suggested that the following key considerations should be taken into consideration as key to the implementation of the strategy:

An integrated approach should be adopted with regard to LED, so that LED is not treated as a mere line-function, and is supported by all municipal departments.

• The municipal IDP needs to be practical with LED featuring prominently.
• More funds should be allocated to LED projects from the municipal budget so that LED can make the required impact in the local economy.
• The development of municipal infrastructure will go a long way in promoting investment and growth in the municipal area.
• A close working relationship between the municipality and the formal and informal business sectors should be established, to place the municipality at the forefront of development.
• Sector departments should involve the municipality at the conceptual stage of all projects that are earmarked for the ADM and its local municipalities.
• Local leadership is critical and essential for LED success.
• The municipality must encourage the use of local labour and effective local procurement as far as possible.
• ·All efforts must be employed to continuously seek funding for all identified projects.
• The monitoring and evaluation framework must be utilised to identify successes and blockages.
• That the municipality develops a Red Tape Reduction Plan to address all areas as mentioned in the LED Strategy.

With millions of Rands to be potentially pumped into Newcastle, Dannhauser, and Utrecht to boost the agricultural sector, what are your thoughts on the above?

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