A JOURNEY THROUGH TIME

THE

GRAIN AND OILSEED INDUSTRY

OF SOUTH AFRICA – A JOURNEY THROUGH TIME

ႄႊ

THE FIRST FEMALE

MEMBER OF THE WHEAT

BOARD WAS MRS

AJE NEL, WHO WAS

APPOINTED ON 1 MARCH

1945 AS THE CONSUMER

REPRESENTATIVE.

SHE CAME FROM

POTCHEFSTROOM, WHERE

SHE WAS ALSO THE

MAYOR OF THE TOWN FOR

A PERIOD.

Sound bite: The Sorghum Board was estab-

lished after committee members felt neglected

in the Maize Board – Mr Piet Skinner.

Nature and scope of control

Traditionally, sorghum was produced and consumed in subsistence farming,

without having any marketing structures. Even after commercial producers

started cultivating it on a larger scale, the marketing of sorghum was not very

successful initially.

From 1945 until the 1948/1949 season the Maize Board handled the marketing of

sorghum as a temporary measure in order to establish a single-channel marketing

system for sorghum and manage the marketing in a more organised manner. From

1949 there was again no formal control over the marketing of sorghum, until it was

taken over once more by the Maize Board in the 1957/1958 season.

In that season a pooled system was used to market sorghum, but from the next

season a floor-price system was introduced to stabilise the domestic prices. This

system was operated by the Maize Board as part of the Summer Grain Scheme until

1985. The floor-price system was a less comprehensive control scheme than the

single-channel scheme that applied with respect to maize. Essentially this involved

that the Maize Board announced a price at which the Board was willing to buy

sorghum from producers who were unable to sell it elsewhere at a higher price.

The price, which varied depending on the class and grade of sorghum, was therefore

a minimum limit or floor, below which the producer price could not fall, hence the

reference to ‘floor price’. The floor price was set at the beginning of the season by

the Maize B, with approval by the Minister of Agriculture. Until the 1964/1965 season

the floor price remained in effect from 1 May to 31 October of each year, but in the

1965/1966 season the commencement date was moved to 1 April.

When the floor price was announced, theMaize Board also announced theminimum

price at which it would sell sorghum that had been purchased at the floor price for

domestic use. The latter price was usually a bit higher than the floor price to make

provision for the Maize Board’s expenses with respect to sorghum and encourage

traders to purchase as much as possible of their requirements directly from the

producers early in the season.

In terms of the floor-price scheme traders were free to purchase sorghum directly

from producers and trade with it, in contrast to the single-channel marketing

systems that applied to maize and wheat. There were also no price prescriptions

with respect to this trading.

In practice the Maize Board purchased sorghum directly from producers only in the

main production areas. These were clearly defined areas and included the former

Transvaal and Orange Free State provinces and a few magisterial districts in the

Cape Province and Natal. The Maize Board appointed sorghum agents in those

areas to handle and store sorghum that had been obtained from producers under

the scheme at prescribed tariffs on behalf of the Board, in accordance with the

prescriptions of the Board. The storage facilities belonged to the agents, who were

mainly agricultural co-operatives.

Appointment and registration

Initially, until 2 March 1984, sorghum traders were not obliged to register as such

with the Maize Board, but processors of sorghum did have to register. All sorghum

agents and manufacturers of sorghum products in the Republic had to submit

monthly returns of all their transactions in sorghum and sorghum products to the

Board. Sorghum traders, on the other hand, were not obliged to submit returns of

their transactions in sorghum to the Board, except those who purchased sorghum

for their own account in certain identified areas that varied from time to time.

Export

The Maize Board did not undertake to export sorghum itself. The exportable surplus

was offered to exporters per tender at predetermined times, and these exporters

were responsible for selling and shipping to overseas buyers themselves. However,

the Maize Board ensured that the necessary logistical arrangements were made to

deliver the sorghum to the successful tenderer in the port, usually in the grain silo at

the Durban Harbour.