Could a recent farm workers dispute in, De Doorns, a wine region in the Western Cape in South Africa, become the agriculture equivalent of the Lonmin’s platinum mine dispute?
National minimum wage in South Africa for agricultural workers is R69.99 a day (about US$8 per day).Striking workers in De Doorns are asking for a pay raise to R150 per day (US$17).
Some farms have been torched and the lives of farm owners threatened. Rubber bullets have been fired to disperse picketing workers.
Labour costs for vine, fruit and other perennial crop enterprises are higher as a percentage of farm costs than they are on arable farms which use machinery more than manual labour. The outcome of this dispute could have broad implications for more labour intensive farms throughout South Africa.
Similar strikes have already spread, with farm workers downing tools in Mpumulanga (formerly Eastern Transvaal), a far away region in the north east of the country.
For South Africa, lower labour costs are one of the primary drivers of the competitiveness in global produce markets. If a precedent for pay rises is set, perennial farms will be less profitable and there will be less support for farmland prices.
Quite aside from the obvious ethical questions, this is a reminder of the social risks that exists for agricultural investors in poorer nations where farm incomes and agricultural land prices are tied to low labour costs.