Recent Trends in Agricultural Land Prices in South Africa: A Preliminary Investigation Using Cointegration Analysis

The main objective of this paper is to report preliminary findings on the recent trends in agricultural land prices in South Africa against the backdrop of growing concerns over their rising levels. Given the important role of land prices, the impact such increases would have on significant national development efforts, including the on-going land reform programme and other aspects of agricultural restructuring, provide strong justification for this investigation. The cointegration approach was employed within a framework that allowed for both long-run and short-run dynamics of the relationships to be identified. Building on previous structural modelling of farmland prices in the country, and using much expanded time series spanning forty-nine years, it was possible to establish some patterns of causation in the relationships between farmland prices and a range of macro-aggregates, including interest rate on debt, the rate of inflation, Gross Domestic Product, among others. Although the important role of foreign buyers is suggested by some of the results, there is need for further studies on this subject, using alternative data sets. The finding of a Granger causality relationship between farmland prices and GDP is interesting to the extent that it reflects buying power and confirms impressions about the crucial role of farmland prices in national economic management and the successful implementation of the on-going agrarian reforms in South Africa.Land Economics/Use, C22, E3, Q15, Q18, Q24,

Performance of Smallholder Agriculture Under Limited Mechanization and the Fast Track Land Reform Program in Zimbabwe

agricultural mechanization, fast track land reform, agricultural development, Stochastic Frontier model, technical efficiency, agribusiness management, Agricultural and Food Policy, Community/Rural/Urban Development, International Development, Land Economics/Use, Resource /Energy Economics and Policy,

Efficiency Effects Zimbabwe’s Agricultural Mechanization and Fast Track Land Reform Programme: A Stochastic Frontier Approach

A development goal pursued by the Zimbabwean government even before the much-maligned fast track land reform programme (FTLRP) was expansion of agricultural production through agricultural mechanization. This goal has been pursued through the acquisition and use of tractors by arable crop farmers in communal and resettlement state land delineated during the period following the launch of the FTLRP. This research project investigated the combined impacts of mechanization and an unplanned land reform on agricultural productivity in the Bindura district of Zimbabwe. The existing land policy and the issue of technical efficiency in agricultural productivity are assumed to be the drivers of the programme. It is likely that these issues will be important considerations in determining the sustainability of the mechanization policy. A multistage sampling technique was used to randomly select 90 farmers in the study area and structured questionnaires were used to collect demographic, investment and production data which were subsequently fitted by means of the Stochastic Frontier Model. Results revealed that mechanization was an important factor in the performance of the farmers who participated in the programme. The results also suggest that availability of land and access to production resources are crucial to farm productivity. Despite these, overall production and productivity remain low and the hyperinflationary situation triggered by supply constraints are only beginning to slightly ease. As the national unity government grapples with the huge task to restore growth in the Zimbabwean economy, it is important that these issues are borne in mind.Technical Constraints, Market Access, Agricultural Development, Induced Innovation Model, The Stochastic Frontier model, The Productive Efficiency and Mandate of Extension, Farm Management,

Deregulation of the Maize Marketing System of Swaziland and Implications for Food Security

Recent shortfalls in the supply of maize in the Kingdom of Swaziland have exacerbated the country's growing food insecurity and led to fresh calls for full deregulation of the maize marketing system. The proponents of deregulation believe that it eliminates inefficient production and service units by transferring resources to their best alternative uses. While the theoretical foundations for that position are not questionable, no studies have to date explicitly investigated the effects of the current arrangements and the potential effects of full deregulation. This paper reports on a study that examined the welfare effects of the regulation of the country's maize industry and considered the likely impacts of full deregulation of the industry. Using a partial equilibrium model, the study established that the current market arrangements for the maize industry are distortionary and make the maize marketing system of Swaziland highly uncompetitive. The results show that high efficiency losses result from the misallocation of productive resources and that these have been rising over the years. Consumption deadweight losses were also shown to be equally serious and put at risk the attainment of food security for the generality of the Swazi population. The paper sees deregulation as an important practical step to improve the competitiveness of the maize industry and enhance food security through creating the basis for more effective management of the internal maize distribution channel in Swaziland.Crop Production/Industries, Food Security and Poverty, D6, F13, I3, L5, Q18,

Resource Use Efficiency in Soybean Production in Rwanda

Even though soybean (Glycine Max) is currently a minor crop in Rwanda, it is one of the crops that the government of Rwanda is promoting because of its high nutritional value, adaptability to the climate of the country, and its good response to organic and mineral fertilizer inputs. Since farm resources are limited in Rwanda, it is critical to devise ways of improving their productivity and use efficiency even in soybean production. This study used on-farm data from Kamonyi district collected during two agricultural seasons from September 2007 to July 2008 and identified key factors determining soybean production and resource use efficiency in soybean production. Cobb-Douglas production function was fitted. Results indicate that, with an elasticity of 0.46, plot size was the most important factor of soybean production. It was closely followed by intermediate inputs (fertilizers, pesticides and seeds), with a coefficient of 0.44. When intermediate inputs were decomposed, fertilizers with an elasticity of 0.062 appears to contribute more to soybean production than pesticides (0.057) and seeds (0.034). Technical inefficiency was responsible for at least 93% of total variation in soybean output among the survey farmers. The relative efficiency (allocative efficiency) of resource use, expressed as the ratio of marginal value product (MVP) to marginal factor cost (MFC), were 1.73 for soybean plot size, 1.36 for fertilizers, and 1.92 for pesticides. These indicate that too little of these inputs are being used in relation to the prevailing market conditions. Keywords: Soybean, Resource use, Efficiency, Cobb-Douglass production models, Rwand

Unlocking markets to smallholders: Lessons from South Africa

This book assesses the institutional, technical and market constraints as well as opportunities for smallholders, notably, emerging farmers in disadvantaged areas such as the former homelands of South Africa. Emerging farmers are previously disadvantaged black people who started or will start their business with the support of special government programs. Public support programs have been developed as part of the Black Economic Empowerment strategy of the South African government. These programs aim to improve the performance of emerging farmers. This requires, first and foremost, upgrading the emerging farmers skills by providing access to knowledge about agricultural and entrepreneurial practices. To become or to remain good farmers they also need access to suitable agricultural land and sufficient water for irrigation and for feeding their cattle. Finally, for emerging farmers to be engaged in viable farming operations, various factors need to be in place such as marketing and service institutions to give credit for agricultural inputs and investments; input markets for farm machinery, farm implements, fertilizers and quality seeds; and accessible output markets for their end products. This book develops a policy framework and potential institutional responses to unlock the relevant markets for smallholders

Unlocking markets to smallholders: Lessons from South Africa

This book assesses the institutional, technical and market constraints as well as opportunities for smallholders, notably, emerging farmers in disadvantaged areas such as the former homelands of South Africa. Emerging farmers are previously disadvantaged black people who started or will start their business with the support of special government programs. Public support programs have been developed as part of the Black Economic Empowerment strategy of the South African government. These programs aim to improve the performance of emerging farmers. This requires, first and foremost, upgrading the emerging farmers skills by providing access to knowledge about agricultural and entrepreneurial practices. To become or to remain good farmers they also need access to suitable agricultural land and sufficient water for irrigation and for feeding their cattle. Finally, for emerging farmers to be engaged in viable farming operations, various factors need to be in place such as marketing and service institutions to give credit for agricultural inputs and investments; input markets for farm machinery, farm implements, fertilizers and quality seeds; and accessible output markets for their end products. This book develops a policy framework and potential institutional responses to unlock the relevant markets for smallholders

Agricultural Policies for Poverty Reduction: Book Review

Book review of Agricultural Policies for Poverty Reduction, Edited by Jonathan Brook