Faculty of Natural and Agricultural Sciences
School of Agricultural and Food Sciences
Department of Agricultural Economics, Extension and Rural Development
Selected Highlights from Research Findings
Over the past three years the Centre for Environmental Economics and Policy in Africa (CEEPA) implemented and coordinated this project in collaboration with the Agriculture and Rural Development Program, the World Bank Institute and the Africa Region of the World Bank. Under this project studies on economic and hydrological impacts of climate change on African agriculture are conducted in eleven countries representing the diverse agro-climatic conditions on the continent. The countries involved are: Burkina Faso, Cameroon, Egypt, Ethiopia, Ghana, Kenya, Niger, Senegal, South Africa, Zambia and Zimbabwe. A number of regional studies are also conducted under the project in collaboration with Yale University, the FAO, The International Water Management Institute (IWMI) and University of Colorado. This project was funded by the Global Environment Facility (GEF) with complementary funding from the Finnish Trust Fund, National Oceanic Atmospheric Administration (NOAA) Office of Global Programs and The World Bank Institute.
Contact person: Prof RM Hassan.
This project is a collaborative research project jointly funded by the French Government, the National Research Foundation (NRF) and the Water Research Commission (WRC). The project is coordinated by the Centre for Environmental Economics and Policy in Africa (CEEPA) in collaboration with the Centre de cooperation internationale en recherche agronomique pour le développement (CIRAD), which provides part-time support from its research staff through a visiting fellow arrangement with CEEPA. The project funds research and training in developing tools for decision support and economic policy analysis for improved water resources management in South Africa. A number of students from both France and South Africa are supported through the program.
Contact person: Prof RM Hassan.
The Bureau for Food and Agricultural Policy (BFAP) at the University of Pretoria (Department Agricultural Economics, Extension and Rural Development) was established in 2004 with the purpose of facilitating decision making in the South African agricultural sector as well as training of individuals in order to increase analytical and research skills available to the sector. Core funding (over R5 million) for this initiative is provided by: The National Agricultural Marketing Council, ABSA Bank, Maize Trust, WineTech, THRIP programme of the Department of Trade and Industry (DTI) and Eskort Limited. BFAP also has a long-standing international collaboration with FAPRI (Food and Agricultural Policy Research Institute) at the University of Missouri. In a recent study BFAP explored some of the impacts of the biofuels draft strategy that was published by government at the end of 2006 and provided guidelines for the formulation of an alternative biofuel strategy that will assist government to reach its targets of renewable energy, growth in the agricultural sector, and the creation of job opportunities. The study shows that:
Under average 2006 market conditions no commercial crop will yield positive plant profits from the production of biofuels without government support.
Under the government’s draft strategy only very little biofuel production will take place in South Africa and the majority of biofuel will be imported.
The overall impact of the biofuel industry under the draft strategy is modest and the contribution of the agricultural sector to the economy is projected to increase by 1.6% on average until 2015.
Under an alternative scenario where the industry is supported by government, the agricultural sector can grow by more than 4% per annum on average until 2015. More than 10 000 new jobs are generated in the primary agricultural industry and the annual area planted under field crops increases by 4.65% (229 000 ha).
Furthermore, under the alternative scenario South Africa is competitive in the production of bioethanol from maize and sugar since both commodities are frequently trading at export parity levels. The production of biodiesel from vegetable oil is less favourable due to the high value of the vegetable in the human market and the commodity markets frequently trading at import parity levels. Only major improvements in the efficiency of oilseed production in South Africa or a sharp decrease in vegetable oil prices will influence the economic feasibility of biodiesel production in the country.
No country in the world uses a staple to produce biofuels. Therefore, policy alternatives have to be carefully considered to understand the impact on food security. With approximately one million tons of maize required for the production of ethanol under the alternative scenario, the projected increase in maize prices is moderate, but the probability of the maize market trading at import parity levels, if weather conditions are below normal, is very high, thus putting pressure on food security to be maintained
Contact person: Mr FH Meyer.
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