1. Opportunities for social and economic development through Agroforestry
Mabandla Case study
Economic empowerment and development through timber
Jeanette Clarke
Independent Forestry Consultant

2. Introduction South Africa has a semi-arid temperate climate
“Typical” agroforestry systems associated with the humid tropics are inappropriate
However, forests, trees and plantations play a crucially important role in rural farming systems and rural livelihoods

3. Agroforestry SA-style: addressing rural poverty and unemployment through timber plantations
Mabandla Case Study uMzimkhulu
Timber plantations as a catalyst for rural employment and wealth creation
Forestry profits invested in new businesses – economic integration between trees and other land use activities
Integrated rural development and economic empowerment with forestry at the centre
Industrialisation: sawmill and wood products manufacturing capacity

4. uMzimkhulu forestry – the beginnings
Extensive areas with high afforestation potential identified in uMzimkhulu LM Community-industry partnership discussions began in mid-1990s initially with support from Mondi Independent support agency Rural Forest Management (RFM cc) formed to continue the program
Interest from local leaders to embark on commercial forestry business ventures – initially 10, but of those 3 communities established plantations
Mabandla
Zintwala
Ngevu

5. uMzimkhulu forestry – the beginnings
Pre-planting support:
Community Trusts and Companies set up for ownership and business management functions
Technical and business planning phase
Access grant and loan funding (SLAG and Land Bank)
Plantation establishment

6. Mabandla forestry – the journey
Mabandla forestry the most successful of the three
Largest plantation area: 1320 ha plantation of Eucalyptus and Pine
First harvest 2008
120 full time jobs
Turnover R12 million / annum
Self sustaining covering all operating costs and makes a profit of over R1 m
SLAG grant covered 80% of establishment costs – key to early profitability
Community Trust decision to re- invest profits from timber sales in new business ventures
Sawmill
Agri-processing
Ecotourism
Training

9. Financed by Umgano DevCo and IDC R1.4 million loan
Sawmill opened July 2016
Financed by Umgano DevCo and IDC R1.4 million loan
Employment- 24 jobs initially
Value add
sawlog unprocessed R600/ m3
Saw timber R2200 /m3
Next step in value addition – milling plant R4000/m3
Improved Market Access
Zweli Baleni Umgano DevCO CEO Photo credit: SA Forestry

11.  7 000 ha of pristine indigenous forests and grasslands, two major rivers
1 500 ha Nature Reserve managed partnership with Ezemvelo KZN Wildlife
Significant ecotourism potential

13. Skills training for employees of Umgano companies
Education and training needs of broader community
External training for additional revenue
Discretionary grant funding FP&M Seta

14. Currently in advanced planning stage- EIA underway 140 ha vegetable farm and processing facility – 320 jobs Projected turnover R17 m 300 ha hazel/pecan nut orchards 500 head of dairy cattle

15. Opportunities for social and economic development through agroforestry
New Afforestation Area with forestry potential: Eastern Cape hectares KZN hectares
Plantation recap DAFF commercial plantations Some hectares in prime forestry areas – majority on TC land Currently degraded & unproductive
How replicable is the Mabandla case?

16. Mabandla success factors
Strong, visionary and uncontested leadership at Community level
Community ownership and control
Competent and committed partners and mentors – 20 year support from RFM now Umsonti
Rights to large area of productive land
Grant funding for project preparation and establishment phase
Commercial loans from IDC
Investment in capacity building

17. Policy lessons and challenges
Planning and establishment grants are essential for new afforestation given the delay between planting and harvesting timber
SLAG grants covered 80% of establishment costs at Mabandla
The profits from timber sales invested in new businesses, creating more revenue and employment
In VAT alone, the grant has been repaid to government many times over
Afforestation Grants ARE NOT YET AVAILABLE FROM GOVERNMENT!

18. Policy lessons and challenges
Grant finance also required for business start-up. Without a cash portion interest on loans too high for profits in short to medium term - applies to all Umgano businesses
Access to loan finance on good terms (IDC forestry program)

19. Policy lessons and challenges
Expedite water use licensing
DAFF plantation transfer and recapitalisation grants
Training support - important role of SETA discretionary grants
Institutional oversight and strengthening in TC areas
Land tenure reform in TC areas

20. Acknowledgments
Mabandla TC leadership, Community Trust and beneficiaries
Umgano DevCo Zweli Baleni, Mayford Jaca
Peter Nixon, Themba Radebe and James Ballantyne (Umsonti)
IDC