SA Groundnut Forum (SAGF)
held on 12 February 2008 at 10:00 at the offices of the Oilseeds Industry, Rivonia

1. Opening

   The meeting was opened with prayer offered by Mr JAM Potgieter.

2. Welcome

   In the absence of the Chairperson, who was unavoidably delayed by traffic congestion, the Vice-Chairperson, Mr JAM Potgieter, welcomed all present.

3. Attendance

   Present
   Mr JCG du Preez	Chairperson **
   Mr JAM Potgieter	Vice Chairperson
   Mr P Botha	GrainSA
   Mr S Coetzee	PPECB
   Mr O de Witt	SA Peanut Company
   Dr J Dreyer	ARC-GCI
   Ms M Edwards	Nola
   Mr RW Higgs	Triotrade
   Mr CJ Lourens	RE Groundnuts
   Mr J Roux	Safrinut / The New Nut Co.
   Mr P Sanford	FR Waring (Groundnuts)
   Ms M Scheepers	NDA
   Dr J Swanevelder	ARC-GCI
   Dr W van der Walt	SANCU
   Ms A van Deventer	SA Peanut Company
   Mr PJ van Heerden	PPECB
   Mr J Vorster	NWK
   Ms E Harmse	Secretariat
   Apologies
   Ms R Beukes	NDA
   Mr A Bosman	PPECB
   Mr J Cohn	OLAM SA
   Mr A Cronjé	Tiger Brands
   Mr GL de Kock Snr	Roba Peanuts
   Mr GL de Kock Jnr	Roba Peanuts
   Ms A Enslin	SAGIS
   Mr N Hawkins	GrainSA
   Mr G Keun	Chief Executive Officer OAC
   Mr D Kok	Grain Silo Industry
   Mr WA Loubser	SANSOR
   Mr PG Louw	Grain Silo Industry
   Mr C Mathews	Department of Agriculture: Mpumalanga
   Mr GJH Scholtemeijer	Chairperson: OAC
   Mr A Snyman	GWK
   Dr PJA van der Merwe	ARC-GCI

   ** Mr Du Preez joined the meeting at 10:25

4. Personalia

   None reported.

5. Confirmation of agenda

   The agenda was accepted as it stood, with the addition of:

   • Item 8.3 – Import and export parity prices;
   • Item 9.4 – PPECB matters.

6. Approval of minutes

   1. Approval of the minutes of the meeting of the SA Groundnut Forum held on 7 No­vem­ber 2007

      Resolved:

      1. That the minutes of the meeting of the SA Groundnut Forum which was held on 7 November 2007 be accepted as a true and fair reflection of the meeting.

7. Matters arising

   1. Good agricultural and processing practices

      (Resolution 7.1.1 of the SA Groundnut Forum minutes of 7 November 2007)

      The Chairperson confirmed that the Processors and Traders Association's (PTA) document on good manufacturing practices, amended according to the requirements of the checklist of the National Department of Agriculture (NDA), had been sent to the members of the Forum in electronic format. The members were in agreement that the deadline of 31 March 2008 for comments on the document was acceptable, and that their approval of the document would be considered implicit if no responses were received.

      The members noted that the HACCP principles, which are to be issued as an attachment to the document on good manufacturing practices, would be made available timeously for their comment by 31 March 2008.

      Resolved:

      1. That the Forum's approval of the document on good manufacturing practices, amended according to the requirements of the checklist of the National Department of Agriculture (NDA), as well as the attachment on HACCP principles, would be considered implicit if no responses had been received by 31 March 2008.

         Chairperson
         Mr Keun

   2. Investigation: Agri-Inspec

      (Resolution 7.2.1 of the SA Groundnut Forum minutes of 7 November 2007)

      The Chairperson reported that the Department of Health (DOH) had been approached to establish how the Department intended following up on the transgressions reported in the Agri-Inspec report, but that no feedback had been received to date.

      Resolved:

      1. That the Department of Health be approached to establish how they intended to pursue the transgressions reported in the Agri-Inspec report.

         Chairperson
         Mr Keun

   3. Sustainability of the groundnut industry

      (Resolutions 7.3.1 to 7.3.3 of the SA Groundnut Forum minutes of 7 November 2007)

      The Chairperson referred the meeting to resolution 7.3.1 of the previous meeting. It was noted that GrainSA accepted and were satisfied with the official way in which research funds were allocated. Following on a short discussion on the identification of research requirements, it was noted that there was a need for a Groundnut Research Priority Committee, and resolved that such a committee would be formed at the July meeting of the Forum.

      Dr Dreyer reported that the work committee consisting of himself, Messrs du Preez and Loubser, had met to discuss the involvement of experts in the possible introduction of promising cultivars from other countries with the potential of being grown successfully in South Africa. He said Mr Loubser had contacted the International Seed Federation (ISF), who were conducting an international enquiry to identify possible role players in this regard. He said although every effort should be made to import promising cultivars, it was essential that this be done through the proper, legal channels. The members of the Forum unilaterally resolved that illegal imports of groundnut cultivars would not be condoned.

      The Vice Chairperson tabled a letter dated 11 February 2008 from Mr Loubser, in which he stated that the ISF had recommended that those institutions of the Consultative Group for International Agricultural Research (CGIAR) which were concerned with groundnut research, viz. ICRISAT, IITA and possibly ICARDA, should also be contacted. He reported that the ISF were of the opinion that suitable germplasm should be obtainable form India, China, the United States of America (USA) and various West African countries, although adaptability for local production may be problematic. He requested that Mr Loubser's letter be included in the documentation of the following meeting.

      Dr Dreyer distributed a draft motivation for the appointment of a person to promote groundnut production compiled by Mr Cohn and himself for consideration by the members of the Forum. It was agreed that the motivation would be considered at a future meeting of the Forum.

      Resolved:

      1. That a Groundnut Research Priority Committee would be formed at the July meeting of the Forum.

         Chairperson
         Mr Keun

      2. That illegal imports of groundnut cultivars would not be condoned by the Forum.

         Members

      3. That Mr Loubser's letter dated 11 February 2008 on the ISF's recommendations be included in the documentation of the following meeting.

         Mr Keun

      4. That the draft motivation for the appointment of a person to promote groundnut production compiled by Mr Cohn and Dr Dreyer would be considered at a future meeting of the Forum.

         Chairperson
         Mr Keun

   4. Draft regulations pertaining to the grading and packaging of groundnuts of primary producers destined for packaging in the Republic of South Africa

      (Resolution 7.4.1 of the SA Groundnut Forum minutes of 7 November 2007)

      The Chairperson reminded the Forum members of the resolution that their support of the draft regulations relating to the grading and packaging of groundnuts would be considered implicit if no response had been received by the deadline of 30 January 2008, following which the comments obtained from the consultation with the members of the Forum would be provided to Mr Makhafola of the Department of Agriculture (DOA), and promulgation of the regulations finalised.

      The Chairperson referred the meeting to GrainSA's letter on the issue, included in the documentation as Annexure B. He said that the producers had expressed their concern on the possible inclusion of strict grading criteria with regard to aflatoxin in the DOA's regulations, and had subsequently requested that the matter be held in abeyance until it had been discussed at the GrainSA Congress, which was to be held on 5 and 6 March.

      An extensive discussion on the need for different sets of regulations for processors and producers; changes in the industry, with producers delivering unshelled rather than shelled groundnuts to processors and the processing losses consequently suffered by processors; as well as the associated financial implications for producers, followed.

      Mr Potgieter explained that two issues were of concern to the producers, viz. concern on the possible inclusion of strict grading criteria with regard to aflatoxin, and whether producers' regulations for unshelled groundnuts were required in addition to the processors' regulations. Mr de Witt remarked that it had been agreed in 2003 that producers' regulations were required to support producers to comply with the EuroGAP standards on food safety. Mr Potgieter said he would recommend to GrainSA's executive management that an expert be called on to provide producers at the Congress groundnut breakaway session on 6 March with clarity on the guidelines and regulations, producers' and processors gradings, and the importance of food safety and protecting the industry from imports of dubious quality.

      The meeting noted that the systems currently in place with regard to monitoring could be vulnerable to irregularities.

      Resolved:

      1. That implementation of Resolution 9.2.1 of the Forum meeting held on 26 September 2007 on the finalisation of the promulgation of the regulations relating to the grading and packaging of producers' stock groundnuts be held in abeyance until feedback is received from the GrainSA Congress.

         Chairperson
         Mr JAM Potgieter

   5. Seed scheme

      (Resolutions 7.5.1 and 7.5.2 of the SA Groundnut Forum minutes of 7 November 2007)

      Dr Dreyer requested that this discussion item be held in abeyance as the ARC was currently investigating the possibility of commercialising a number of its functions.

      Resolved:

      1. That the options for future seed production be held in abeyance until clarity has been established on the possible commercialisation of a number of the ARC's functions.

         Mr Keun
         Dr Dreyer

   6. International Standards

      (Resolution 9.2.1 of the SA Groundnut Forum minutes of 7 November 2007)

      Ms van Deventer reported on request of the Chairperson that she had deviated slightly from the original resolution that she approach Dr Venter of the University of North West to determine in which way Dr Venter could assist in sourcing the information required to compile a database of the various properties of South African groundnuts. She said she had perused the information required by the international markets for the South African product to comply with the international labelling requirements, and came to the conclusion that some type of specification for South African groundnuts was required in addition to the regulations already in place.

      Ms van Deventer said she had designed a simple template, with sections for the description of the product, the nutritional value, microbiological and chemical standards applicable, shelf life and storage conditions. She mentioned that the description would include the product's certification as a South African product, the cultivar, class, and additives, among others. She suggested that nutritional values such as energy and total fats could be determined on a once-off basis for cultivars such as Akwa and SA Juweel, based on pure samples obtained from the ARC. She asked that a decision be made on whether these tests had to be performed annualy, biennially or triennially. She added that she had obtained quotations from the ARC Irene and the SA Grain Lab at the CSIR, which amounted to approximately R10 000 per cultivar tested. The members were in agreement that 1 x100g sample would not suffice for testing of nutritional values, as environmental factors could result in variations. Ms van Deventer noted that expert input was required in populating the section dealing with shelf life and optimal storage conditions, as she could not source South African literature specifying these. Mr Roux suggested that information on the oil content and homogeneity of kernels be added to the template.

      The members of the Forum were in agreement that the contents of the template would be finalised by Ms van Deventer, Messrs de Witt and du Preez. Ms van Deventer agreed to email the template to the offices of the oilseeds industry for forwarding to the members of the Forum, to be returned with comment within seven days of receipt. The Chairperson thanked Ms van Deventer for the effort expended, and added that the Oilseeds Advisory Committee would be approached with a funding application for testing the nutritional value of the various cultivars.

      Dr van der Walt mentioned that an initiative was currently underway under the auspices of the OECD, in which cultivars used in the production of certain crops, including groundnuts, were analysed for their average food composition and parameters determined for natural biological variation. He said the aim was to apply the analyses as an international measure for determining the substantial equivalence of GM cultivars. He suggested that these could also be used as a measure for evaluating local groundnuts, and added that he would determine the names of the local persons involved in the work group for groundnuts, and forward the information to Mr Keun and Ms van Deventer.

      Resolved:

      1. That the content of the template detailing information required by the international markets for the South African product to comply with the international labelling requirements be finalised by Ms van Deventer, Messrs de Witt and du Preez.

         Ms van Deventer

      2. That Ms van Deventer would email the template to the offices of the oilseeds industry for forwarding to the members of the Forum, to be returned with comment within seven days of receipt.

         Ms van Deventer
         Mr Keun
         Members

8. Industry information and marketing aspects

   1. SAGIS: General feedback and market information

      The Chairperson tabled the market information prepared for the Groundnut Forum by SAGIS and dated 12 February, as well as the SAGIS weekly bulletin dated 22 January and the monthly bulletin dated 23 January 2008.

      Mr de Witt said although he did not question SAGIS's statistics, and realised that a direct comparison could not be drawn between SAGIS's information on producers' deliveries and the Crop Estimates Committee's figures, he did want to express his concern about the producers' deliveries as indicated by SAGIS, and the final crop estimate for groundnuts for the 2007/2008 season. He mentioned among others that the final crop for the Northern Cape was estimated at 21 700 t produced on 6 000 hectares, which were mostly under irrigation, and amounted to 3,6 t/ha. According to SAGIS, 14 600 t, or 2,4 t/ha, had been delivered in the Northern Cape. He said the figures skewed calculations about the profitability of the crop. He noted that the percentage of choice groundnuts produced also seemed questionable. He remarked that SAGIS's information was used not only by the local industry, but also internationally.

      Mr Potgieter mentioned that crops could be produced in one area, and marketed in another, which could to some extent explain the incongruity. Following on a discussion on a number of irregularities within the industry, which could contribute to deviations in the figures reported, it was agreed that all the role players in the industry should assist SAGIS and the Crop Estimates Committee in sourcing accurate information. It was noted that certain information held by some of the role players was confidential, and should be treated as such to protect the business interests of each entity. The importance of sourcing accurate information on the amount of seed sold, the area in which it is planted, and the total kilogram seed planted per hectare was underlined.

      The members were in agreement that it would best serve the interests of the industry if accurate figures were published by SAGIS and the Crop Estimates Committee. Ms Scheepers was requested to investigate whether appropriate contacts and information could be sourced, as discussed, on the proviso that all information sourced would be treated with utmost confidentiality. Ms Scheepers agreed to approach Ms Beukes in this regard, and asked that a member of the Forum support the Crop Estimates Committee in this initiative.

      Mr Lourens extended a word of thanks to the Crop Estimates Committee for their contribution.

      Resolved:

      1. That Ms Scheepers, as representative of the Crop Estimates Committee, be requested to investigate sourcing appropriate contacts in an effort to obtain more accurate information on which estimates could be based, on the proviso that all information sourced would be treated with utmost confidentiality.

         Ms Scheepers

   2. Crop and Area estimates

      Discussed under item 8.1.

      The Forum took cognisance of the preliminary area planted estimate of summer crops and the sixth production estimate of winter crops for the 2007/2008 season.

      Resolved:

      1. That the Forum take cognisance of the preliminary area planted estimate of summer crops and the sixth production estimate of winter crops for the 2007/2008 season.

         Members

   3. Import and export parity prices

      The Chairperson called on Mr de Witt, who had asked for this item to be added to the agenda, to open the discussion. Mr de Witt said that the import parity prices, which SAGIS had been providing for the past few months, had been received well and were used widely. He reported that GrainSA's official journal, SAGrain, had since started publishing an export parity price. He explained that the export parity price calculation, which was based on the inverse of the Argentinian model, did not take into account that the current Argentinian free-on-board price of US$1 626 included a profit margin plus a 23% export levy. He said this resulted in an exorbitant export parity price. In addition to this, the fact that import and export clearance costs differed, in that export costs per ton were much higher than import costs, was also not factored into the export parity price calculation. He added that the GrainSA export parity price had an effect on market prices, and negatively influenced the local product's competitiveness.

      Mr de Witt reported that GrainSA had indicated that they would be willing to discuss the issue. The Forum members were in agreement that Messrs de Witt, Higgs and Roux approach GrainSA in order to determine a more realistic methodology of calculating the export parity price for South African groundnuts, and provide the Forum with feedback in this regard.

      Resolved:

      1. That Messrs de Witt, Higgs and Roux approach GrainSA in order to determine a more realistic methodology of calculating the export parity price for South African groundnuts, and provide the Forum with feedback in this regard.

         Messrs De Witt, Higgs and Roux

9. Additional items

   1. SOP on Mycotoxin

      The Chairperson referred the members to the standard operating procedure on sampling and analysis of grains, oilseeds and groundnuts to determine mycotoxin levels and risk management as part of export inspection and certification in terms of the Agricultural Products Standards Act, as compiled by the National Department of Agriculture. The members of the Forum agreed to approve and accept the standard operating procedure to determine mycotoxin levels.

      Resolved:

      1. That the standard operating procedure on sampling and analysis of grains, oilseeds and groundnuts to determine mycotoxin levels and risk management as part of export inspection and certification in terms of the Agricultural Products Standards Act, be approved and accepted by the Forum.

         Members

   2. 8th African Crop Science Society Conference report

      The Chairperson referred the members to Mr Mathews' report on his attendance of the 8th African Crop Science Society Conference. He reported that Mr Mathews' visit had partially been funded by the Oilseeds Advisory Committee and the Oil and Protein Seeds Development Trust. The members were in agreement with Mr Botha's suggestion that Mr Mathews be invited to do a presentation on the Conference at the next meeting of the Forum.

      Resolved:

      1. That Mr Mathews be invited to do a presentation on his attendance of the 8th African Crop Science Society Conference at the next meeting of the Forum.

         Mr Keun
         Mr Mathews

   3. PPECB Grading courses

      The Chairperson tabled the document on the groundnut grading and grading refresher courses to be presented by PPECB from 5 to 13 May and 24 to 25 April, respectively. Mr Lourens noted that deliveries of the groundnut crop was expected earlier than in the previous two to three years, as planting had commenced two months earlier in the current production season. He requested that the PPECB consider moving the date of the refresher course to the beginning of March, and suggested that the grading course be presented before the end of March. Mr Coetzee confirmed that he would investigate the issue, and provide feedback to the members of the Forum within the following week.

      Resolved:

      1. That it be noted that Mr Coetzee would provide feedback to the members of the Forum on the revised dates on which the groundnut grading and grading refresher courses would be presented during 2008.

         Members

   4. PPECB matters

      The Chairperson called on Mr Coetzee to inform the members of the Forum on PPECB matters. Mr Coetzee asked the members to take cognisance of the appointment of Mr Levuyo Mabongo as CEO of PPECB with effect from 1 January 2008. He reported that the PPECB tariff adjustments would be finalised by the end of that week, and would be linked to the rate of inflation. He informed the members of the Forum that food safety audits would henceforth be performed in a more agressive manner than in previous years. He mentioned that the PPECB was currently positioning itself in the market, considering its future strategic options, and assured the members that the PPECB would be getting more involved in the industry rather than less.

      Mr Higgs raised the issue of the tariff of R2 000 payable to PPECB by the producer for on-farm producer inspections. He said processing factories were responsible for registering producers who deliver groundnuts to them as food business operators. He reported that processors were expected to pay for these inspections, and asked whether producers would be prepared to carry the costs themselves. It was noted that the maize and wheat industries had been granted dispensation on on-farm producer inspections, that the silos carried full responsibility for ensuring that products delivered to the silos complied with regulations and standards, and that all monitoring and inspection was carried out at the silos.

      Following on an extensive discussion, it was resolved that the Forum, on behalf of all concerned, would appeal in writing to the National Department of Agriculture that dispensations granted to certain grainseed industries be ruled as equally applicable to all grainseeds industries.

      Resolved:

      1. That the Forum, on behalf of all concerned, would appeal to the National Department of Agriculture that the groundnut industry be favoured with the same dispensations applicable to the other grainseeds industries.

         Chairperson

10. Meeting dates

    The next meeting of the Forum will take place at 10:00, on 24 April 2008 at Potchefstroom.

11. Adjournment

    The Chairperson thanked the members of the Forum for their attendance at and contributions to the meeting. There being no further matters for discussion, the meeting was adjourned at 14:00.