In celebration of Youth Month in June, Land Bank has reaffirmed its dedication to assisting young people in agriculture through a range of programmes.
Themba Rikhotso, CEO of Land Bank, says the aim is to support the active participation of black producers and majority black-owned enterprises in South Africa’s agricultural value chains.
“We are proud that for the 2024 financial year, the bank’s disbursement to youth accounted for almost 11% of our loan book, which is a figure we are working towards increasing in this current financial year,” said Rikhotso.
Land Bank was pleased with the increasing presence of young farmers in South Africa, he said. Even though farming was not typically seen as a “cool” job, increasing numbers of young people were succeeding in the profession.
Rikhotso said the youth (those aged 15 to 34) make up more than a third of the population but faced a 42% unemployment rate in the first quarter of the year, according to StatsSA. In rural households, over half (51.5%) are unemployed and actively searching for jobs, while around 10% are self-employed.
Even though more young people are becoming interested in farming, AgriSA says the average age of farmers is about 57. This aligns with global patterns, as most young professionals prefer urban areas and corporate careers.
Rikhotso noted that although the agricultural sector isn’t usually popular among young professionals, it is positive to witness an increasing number of young black entrepreneurs participating in it.
“While it is encouraging to see that young entrepreneurs are being drawn to farming, it remains crucial to attract more young people to this industry, especially in a country such as South Africa that has a growing population and needs to ensure food security for future generations,” said Rikhotso.
Despite more young people showing an interest in farming in recent years, the Land Bank chief acknowledged that entry into the sector remains difficult for aspiring young farmers. According to Rikhotso, lack of land ownership, high input costs, access to credit, lack of market access, low returns, the high cost of mechanisation and a lack of farming knowledge are some of the main barriers hindering youth participation in agriculture.
“Better land availability, financial support and the dissemination of information about rural development programmes are the main interventions that can improve youth participation in the agricultural sector,” he said.
He mentioned Land Bank’s Blended Finance Scheme (BFS) as part of the solutions to these challenges. “The BFS is a 50% grant and 50% loan that is designed to support producers engaged in value chain and aggregation activities. It aims to assist farming projects achieve sustainability and growth, with priority given to projects with high development impact,” Rikhotso said.
“Financial stability remains an important aspect of farming and key to encouraging more young entrepreneurs to enter the agricultural industry. Mechanisms such as the BFS are therefore extremely important to lowering the barriers of entry for aspiring professionals who would otherwise not be able to make it in this sector.”
Rikhotso said beyond financial support, Land Bank also provides access to a post-investment management services team that supports BFS beneficiaries in a variety of ways – from crop inspection to helping source leased equipment.
“With the support of the BFS, Land Bank has seen many emerging farmers reach their dreams of becoming successful agripreneurs and active contributors to employment within their communities,” he said.
Seeing young black farmers flourishing in diverse agricultural sectors and regions is encouraging, he said. “We will continue to actively support these young professionals and to encourage new entrants into this sector.
“We wholeheartedly believe that supporting South Africa’s young agripreneurs will not only improve the succession prospects in the crucially important agricultural sector but will also act as a motivator to persuade more young professionals to come on board.”
