13 December 2023
By: Suzanne Venter
Despite early orders, loyal customers of Greenlands Fertilisers heard in early November that the company would not be able to deliver fertiliser this year.
“I have been a customer with them for more than 30 years. When my phone rang on November 1, I thought the agent wanted to confirm the delivery time. But then he said, sorry, we won’t get fertiliser because there isn’t any, and he probably won’t have a job either,” says Hansie Theart, a farmer from Lichtenburg.
Theart was not alone. All Greenlands customers heard the same news from their agents at the beginning of planting season. This was despite orders being finalised as early as June and some deposits being paid.
A document issued by Greenlands to its agents on November 2 said the company could not deliver fertiliser because it had been bought by BB5 Group.
It said BB5 would not be able to deliver fertiliser due to currency complications with the South African Revenue Service (SARS) and that farmers who had already paid deposits would be refunded.
A copy of the document was shown to Landbouweekblad, a sister magazine of African Farming, by an agent of Greenlands on condition of anonymity. It later became part of court documents.
What complications?
James Grey, managing director of BB5, said in response to Landbouweekblad and in an affidavit filed with the Gauteng High Court that the company entered a purchase agreement with PBD Boeredienste, of which Greenlands is a registered trademark and trading name. But it did so only in September and was not obliged to deliver fertiliser in October or November to meet current orders.
Grey also said they first heard about the so-called currency complications with SARS when Landbouweekblad contacted him on November 24.
This was after Landbouweekblad had asked Greenlands for a contact number for BB5 on November 17, but Greenlands failed to provide it. The purchase agreement has since been cancelled by Greenlands, allegedly due to BB5’s breach of contract.
Pieter Janeke, owner and director of PBD, said information about Greenlands’ alleged currency complications is confidential and was communicated to him by PBD’s manager, Wayne Degnam.
In his affidavit, Janeke says BB5 is solely to blame for the failure to deliver fertiliser: “The fact of the matter is that BB5 is responsible for the failure to deliver products to farmers. They knew exactly which products needed to be purchased and that they had to purchase them. They are the cause of all the problems.”
Janeke denied that farmers had been misled or suffered losses. He also confirmed in an e-mail to Landbouweekblad and in his affidavit that Greenlands had refunded the deposits of all farmers who provided their bank details. He said information in the document sent to agents was provided as soon as possible so farmers could make alternative arrangements.
In his e-mail, he said Greenlands had always strived to act in the best interest of its customers and agents and that it would not comment further on the matter.
Orders taken as early as May and June
Alphonso Enslin (Phonnie) Smit, an agent who has worked for Greenlands for 25 years, also submitted an affidavit. “We are nine agents, and like every year we have taken fertiliser orders since May and June,” it says. “Greenlands usually buys raw materials after orders are placed so that the mixing of fertiliser can begin for deliveries around August and September.”
This year, he says, agents were told fertiliser would be delivered by October but it didn’t happen. Then they were told deliveries would take place in November, and that also didn’t happen. Another agent who has worked for Greenlands for 35 years, and who spoke to Landbouweekblad on condition of anonymity, agreed.
Just ‘dropped’
The agent and Smit said that after months of hard work, they had been left holding the baby but were not responsible for it. Smit has 49 clients and the agents say about 15 000 tons of fertiliser was supposed to be provided to farmers for the 2023-24 season.
“The farmers were just ‘dropped’ after I gave half of my life to Greenlands and built up a loyal customer base over many years,” says Smit.
“Some farmers have been buying fertiliser from us for more than 20 or 30 years. And it’s not just the farmers who were dropped. We, as agents, were supposed to get a commission, but we have been informed that a letter will be sent out soon to inform us that we have been fired and will receive no commission or reimbursement for our expenses.”
Both agents say they are at retirement age and don’t know what they will do without an income.
Fertiliser is now more expensive
Both have done their best to help their clients obtain fertiliser from other suppliers, but they say prices are higher than they were months ago when farmers placed early orders to get good prices and the right product. “Getting fertiliser on short notice is difficult,” says one of the agents.
An agent says Degnam sent details of an alternative fertiliser supplier with a price list shortly after Greenlands’ announcement on November 2. However, the suppliers wanted to be paid in cash and purchases could not be made through financial institutions like cooperatives, which was problematic for farmers.
A farmer who asked to remain anonymous says he placed his fertiliser order on July 3 during a conversation with the agent. “Although it was informal, a price promise was made that usually applied in previous years,” says the farmer.
The agent then told him in October that the fertiliser would be 5% to 10% more expensive, and confirmed this on October 10. “Due to the nature of the situation, the agent’s hands were tied due to the takeover process and he could do nothing about it,” says the farmer.
Theart says he could get fertiliser but it was 25% more expensive than he would initially have paid. “And we are now a new customer, so we are at the back of the line,” he says.
Another farmer who spoke on the condition of anonymity says he had to pay R3 000-R4 000 per ton more for fertiliser blends and R1 000-R2 000 more for urea. “Depending on each farmer’s budget, you then have to either reluctantly pay more or buy less fertiliser,” says the farmer.
Another anonymous farmer says he and his two neighbours were also able to get other fertiliser with the help of their agent but at a higher price.
Henk Alberts, who farms near Ventersdorp in North West, says he has been farming for 27 years and has bought fertiliser from the same Greenlands agent for 23 years. “We got along well and he provided good service,” he says.
“I happened to decide in September to buy fertiliser from another company because I wanted my fertiliser then and didn’t want to wait any longer. In the end, I had to pay R2 000 per ton more at the other company than the initial price I wanted to fix in June at Greenlands.”
Trust betrayed
One anonymous farmer says he and his neighbour never looked for fertiliser elsewhere or made price comparisons because they received such good service and prices from Greenlands for many years.
“As my neighbour says, why fix something that isn’t broken? But that’s no longer the case.”
Theart says the bad experience has damaged his trust in Greenlands. Alberts and a few other farmers agree but say, “We may continue to support the agent we worked with because he is an excellent agronomist.”
