Fair Trade Fruit and Wine and Land Transformation in South Africa

Issue:
There are significant changes in the agricultural sector in South Africa as a result of black economic empowerment and the land transformation process.

But there are still many challenges faced by small scale farmers in adding value to their products and accessing international markets. The Thandi initiative is helping to address these constraints by developing a fair trade brand to market fruit and wine internationally, and promoting partnerships to mentor previously disadvantaged farming communities.


Approach:
With a Business Linkage Challenge Fund grant of £340,000 and a private sector contribution of around £565,000, the project provided a transition for Previously Disadvantaged Individuals (PDI’s) from predominantly low skilled labourers to asset-owners and participants in the formal South African wine industry. The underlying objective of the scheme was to support the South African government’s Land Transformation policy advocating equitable access to land.

The project implemented through Capespan, South Africa’s leading fruit exporter, and Vinfruco and Stellenbosch Vineyards, two of South Africa’s largest wine exporters, sought to create economies of scale by consolidating PDI-farm wine production and marketing under one internationally recognised brand name. Thandi Wines in collaboration with Fair Trade helped to promote a niche market for a quality product, thus providing PDI’s with access to international markets.  

 
Impact:
The project has benefitted around 500 farm workers and generates revenues of over 5 million South African Rands each year. Thandi wines has been recognised for quality by being the first Fair Trade wine to win a Gold medal at the International Wine Challenge in London 2004 and a Silver medal in 2005. By being recognised as a quality FairTrade wine, Thandi Wines is considered a successful model for duplication by other wine producers in the region. As the project has grown and attracted wine-tourism, the vineyards have included local craft-businesses into the business model and provide additional linkages to farm produce suppliers through restaurants and guest houses in the region.  

Thandi fruit and wine is now sold successfully in the UK through the Co-op and other supermarkets. It also sells into markets in European, North American and the Middle East. More than half a million cartons have already been traded. The project has also helped entrepreneurial farmers grow and develop – one man who was a farm labourer is now the chief wine maker and has an equity share in the farm that used to employ him.