CC-2019(03) Mtombeni, S. Bove, D. Thibane, T. Makgabo, B. (2019) An analysis of the barriers to entry and expansion limiting and preventing access to markets for emerging farmer

This is the third paper of a series of research papers that examines the barriers to entry and expansion facing emerging farmers in the South African agricultural sector. This paper focuses on the barriers to entry and expansion facing emerging farmers to market their products in the agricultural sector relating to grading, exclusionary standards and regulations, packaging and branding requirements by retailers and access to shelf-space in retail markets. The paper examined these issues in a selection of key agricultural markets, namely; grain, poultry, red meat, wool and fresh produce (potatoes and citrus fruit). The authors observe that barriers exist in the identified market value chains. In the grain market, there is lack of training for farmers on grading standards, production and market planning, while in the poultry market the challenges relate to lack of local production capability, information asymmetry and the impact of dumping of imported chicken on the local industry. There are further high barriers in the retail and export channels of the fresh produce market due to stringent compliance requirements. The challenges faced by emerging farmers in the red meat industry is with regards to trading their livestock through certain marketing channels such as abattoirs. In the wool industry, the barriers observed relate to information asymmetry, adverse market trends and veld and herd management but these barriers are not insurmountable as there are alternative marketing opportunities. Recommendations are made to facilitate the entry and participation of emerging farmers in these select markets.