Roundtable of stakeholders about South African-Dutch Agro-Processing business opportunities
The roundtable was organized by the Netherlands Embassy in Pretoria in order to further discuss the findings of an earlier study on the current state of the agro-processing industry and opportunities for Dutch businesses in South Africa.
Involvement of Dutch business
In 2018, a study on the current state of the agro-processing industry and opportunities for Dutch businesses in South Africa was commissioned by the Embassy of the Kingdom of the Netherlands in Pretoria, South Africa. Findings from the study were presented at the Southern African Business Dialogue in the Netherlands in January 2019. The study focused on fruit and vegetable processing. In order to place the research findings in a broader context, a roundtable discussion was organized at the Dutch Embassy in Pretoria on the 12th of September 2019. Several local actors from both the private and public sector participated and shared their views on how the Netherlands, and more specifically Dutch business, can be involved to contribute in the development of the fruit and vegetable processing industry in South Africa.
The current state of Fruit and Vegetable Processing
The agro-processing industry has been identified by the South African government as a key sector for further industrialization and employment creation. However, agro-processing for South African fruits and vegetables is not receiving enough attention. The focus lies on fresh unprocessed produce. Mostly, it is the lower quality, or unappealingly looking fruit that is used for processing. For nuts (most notably Macadamia nuts) even, most raw materials are exported to be processed abroad. The existing processing industry is largely dominated by a few big players and entry for Small and Medium Enterprises (SMME’s) is difficult due to large capital investments and advantages of scale by the larger existing processors.
The Netherlands is famous for its agricultural expertise, also in the subfield of agro-processing. The current policy agenda in the Netherlands regarding agriculture is guided by the principle of circular economy and focusses on healthy and safe food, and climate neutral and climate resilient food production. The trend towards healthier food also includes the appearance of novel niches for less known fruits and vegetables on the Dutch food market. This could prove to be a potential for indigenous South African produce. Next to that, the technology available in the Netherlands could help the development of South African SMME’s in agro-processing. Examples of such include optimizing water usage, improving packaging and optimizing the usage of residual flows.
Roundtable Discussion – a practical view on future Dutch-South African cooperation
During the roundtable, some of the attendees shared some of their current projects, and the challenges these projects are facing. It became clear that both private and public entities were working on business opportunities for SMME’s in agro-processing. Government support happens currently mainly through training of SMMEs, and linking SMMEs to other possible business partners. On the other hand, private initiatives attempt to create concrete business plans, in cooperation with small scale farmers. However, most initiatives are still in a pilot phase, and require further investigation.
When the participants were asked about what Dutch companies could offer South Africa, a number of ideas came to the table. Besides the demand for foreign investors, strategic partnerships were also mentioned. The South-African agro-processing industry can definitely benefit from Dutch technology, enabling South African businesses to produce more efficiently and more cost-effectively. Proven Dutch business models could also be applied in South Africa, either as lessons, or as concrete business plans. Moreover, partnerships with Dutch companies could prove a gateway to exporting into the European Union. Dutch companies possess greater knowledge about the niches in the European market, and the required quality standards for exporting to the EU.
Looking into the future of agro-processing
Almost all participants of the roundtable agreed that a follow-up could be of real added value. The ideas discussed need to be taken to the next level. It was indicated that a connection with Dutch companies, could result in viable business ventures. This could stimulate win-win business to business partnerships. Participants committed to work closely with the Dutch Embassy in developing and implementing strategic activities that will open up opportunities for partnerships and collaborations between the Dutch and South African agro-processing and related industries. The Dutch Embassy plans to engage in follow-up activities.
Findings of agro-processing study in 2018
For more information on the findings from the 2018 agro-processing study, please read this earlier publication and also attached at the link below.