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CHAPTER 2
The offices of the Maize Trust in 1969.
Urea arrives at the Durban harbour. The
Maize Trust exchanged urea for maize after
the price of nitrogen skyrocketed.
Video: A personal account of producer mem-
bers’ then resignation from the Maize Trust
– Mr Crawford von Abo.
to the average production costs in the Transvaal Highveld Region and the north-
western Free State region.
• An allowance for contingencies like unforeseen price increases and interest on
operating capital.
• Entrepreneurs’ remuneration for the producers, which was calculated with a
specific formula.
• Additional considerations like supply and demand trends and the relationship
between the maize price and the prices of other agricultural products.
The advance price set by the Maize Board meant that producers could do their
planning for plantings at a fixed lowest-price scenario. Prices did stabilise, but
often at higher levels than the world markets.
However, even in 1951 differences arose between the government and the Maize
Board about the producer price for maize, a battle that still led to major dissatis-
faction and disagreement for decades afterwards. The Cabinet was not satisfied
with the price calculations, but eventually accepted the price recommended by the
Maize Board because it feared that not enough maize would be produced in the
country if a lower price was set.
Themaize pricewas the same for thewhole country, regardless of where the product
was harvested or delivered, which meant that producers who were located closer
to the market subsidised the transport costs of the producers further away
from the market. This probably contributed to production in the marginal areas
being expanded, and later scaled down again after controlled maize marketing was
abolished in 1996 and a transport differential came into effect. The result was that
producer prices no longer made the production of maize in those areas profitable.
The fixing of the maize price led to robust debates and dissatisfaction from
producers on several occasions – to such an extent that the producer members
of the Maize Board by common consent and with the full support of the National
Maize Producers’ Organisation (NAMPO) resigned from the Maize Board.
The background to this was that in the previous year (1984) the Minister of Agriculture,
Mr Greyling Wentzel, had concluded an agreement with the Chairperson of the Maize
Board, Mr Crawford von Abo, in which theMinister had undertaken to accept themaize
price the Maize Board proposed if that price had been unanimously accepted by the
members of the Maize Board, including the consumers. This in fact happened, and the
Minister of Agriculture was forced to accept and announce the proposed price, even
though it was considerably higher than the previous year’s price (R100/ton higher) and
he did not really agree with it.
However, it led to great dissatisfaction from, among others, the State President,
and the realisation developed that the ongoing tension between the producers
and the Minister about the maize price was extremely dissatisfying and had to
be addressed at the highest level. The Maize Board decided to negotiate with
the government regarding the appointment of a ministerial committee that could
1957 – JOSEPH’S POLICY ACCEPTED
We all know how Joseph in Biblical times advised the Pharoah to store grain
from the seven good years for the seven lean years. This was why the Board
gave the name of “Joseph’s Policy” to its decision to carry over a maize re-
serve every year as a safeguard against a possible poor crop the next year.
The need for adequate carry-over stocks was a regular point of dis-
cussion for the Board from the early 1940s onwards. Matters came
to a head in 1957 when it became necessary to import maize to sup-
plement a shortage in domestic production. It was then decid-
ed in March 1957 to set the carry-over stock level at 636 000 tons.
This figure had been adjusted from time to time to its eventual
900 000 tons. The cost of carrying this stock was borne by the
Government in the past.
Maize Board 1935 - 1985
