Local sugar cane farmers haul their way to success

Cane growers in northern KwaZulu-Natal, stood united to salvage their 2012/13 harvest after longstanding haulier Unitrans ended its cane haulage operations in their area, impacting the income of 50 commercial growers and more than 2 500 small-scale cane growers in Felixton and Amatikulu.

The farmers rallied together and managed to raise sufficient capital to buy the Unitrans’ assets in the two operational areas to ensure sustainability of their businesses and livelihood.

On 6 April 2013, with support from 95% of growers, the farmers formed their own company, Zululand Agricultural Holdings (ZAH). The change of ownership resulted in a deal which included 15 rigid-drawbar truck combinations and various moveable assets used at the depot to haul cane.

Both large and small-scale growers delivering cane to the Amatikulu mill supply area became shareholders in the company.

A long-term lease agreement was negotiated with Tongaat Hulett for the use of a depot and office complex.

“Tongaat Hulett played an influential role in providing guidance to ZAH, assisting the company with the alignment of the administrative processes and brought on board new clients who positively impacted the growth of the company,” says Nkonzo Mhlongo, Tongaat Hulett Socio-economic Development Manager.

Dave Littley, Managing Director of ZAH, is a cane grower with experience in transport logistics, project management and engineering. “During 2013/14 and 2014/15, the company successfully managed to haul a total of 859 000 tons of cane despite the tough drought stages that the agricultural sector experienced,” says Littley.

“We took over Super Group Melmoth’s cane haulage business in 2016, and two vehicles from Alternate Sure Haulage. Furthermore, we continue to upskill existing staff and assist in the training of handicapped individuals.”

ZAH plans to expand its business operations in the next few years and is looking at several opportunities that will add value to the business.

Under the guidance of Alan Gordon, General Manager of ZAH, no stone was left unturned to ensure the company achieved above budget results.

“Since its first year of operation to date, ZAH has increased revenue by 400% and the fleet has grown from 15 to 42 trucks, three tractors and two Bell loaders,” says Gordon.

“ZAH experienced the challenge of having to establish a new company from scratch in a short period of time which was overcome by handling all aspects of a medium-size operation with a dedicated team. We currently have 120 employees and our client database grows annually by about 15%.”

Gordon says to date the company can report some notable achievements: all shareholders were paid back dividends on their ZAH shares and R2.7 million worth of dividends were paid to the participating small scale growers and cooperatives in 2016/17; operations have expanded into timber haulage; being awarded the Tongaat Hulett Sugar Amatikulu Smuts contract in 2014 and ZAH’s purchase of their own depot in Melmoth.

The new CEO of ZAH will commence in October and discussions are already underway to expand the haulage company beyond the sugar cane industry to add further value to local farmers.

 

The Zululand Agricultural Holdings team has started to reap the rewards of its hard work