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26 March 2018 Photo Pixabay
Back to the drawing board to save water
We’ve managed to damage nature’s ‘filter’ with air, ocean, and soil pollution, and by destroying wetlands.

Dr Cindé Greyling, a University of the Free State (UFS) DiMTEC (Disaster Management Training and Education Centre for Africa) alumni, studied drought mitigation with a strong focus on communicating important water-saving information. 

Can we run out of water?
Yes, and no, says Dr Greyling. “To our knowledge, water is not ‘leaking’ through our atmosphere. We have what we have, but that doesn’t mean we will have enough clean, fresh water forever. Nature has a magnificent way of purifying water through the water cycle. We, on the other hand, must use a lot of money and energy to purify water. Also, we’ve managed to damage nature’s ‘filter’ with air, ocean, and soil pollution, and by destroying wetlands. The other problem is a simple supply and demand scenario. More people will need more water, but not only that, population growth calls for industry development and increased food supplies – all of which require more water.”    

A war over water
Besides some Hollywood impressions, it is difficult to imagine a war over water, but it is possible. “Some experts are convinced that we are heading there, and others claim that such tensions already exist. Personally, I don’t favour these kinds of shock tactics (or truths) – social research has shown us that it rarely leads to behavioural changes. We can learn a lot from what was has been done in Cape Town. Although we all think people were bombarded with ‘Day-Zero’-scares, they were actually encouraged to adapt their behaviour with a communication campaign that hardly ever used the term ‘Day-Zero’. This approach mobilised citizens to reach record lows of water usage.” 

Adapt a new normal
Dr Greyling encourages the “new normal” set in motion by Capetonians. “Water consciousness is needed, even when the rain comes again. We’ve taken water for granted for too long. As consumers, we have the power to turn this situation around – drop for drop. Be aware about the amount of water you use, how you use it, and for what. Keep in mind that any wastage and pollution (of ‘dry’ things) also wastes and pollutes water. Generally, we need to behave better regarding consumption.”  

News Archive

Producers to save thousands with routine marketing strategies, says UFS researcher
2014-09-01

 

Photo: en.wikipedia.org

Using derivative markets as a marketing strategy can be complicated for farmers. The producers tend to use high risk strategies which include the selling of the crop on the cash market after harvest; whilst the high market risks require innovative strategies including the use of futures and options as traded on the South African Futures Exchange (SAFEX).

Using these innovative strategies are mostly due to a lack of interest and knowledge of the market. The purpose of the research conducted by Dr Dirk Strydom and Manfred Venter from the Department of Agricultural Economics at the University of the Free State (UFS) is to examine whether the adoption of a basic routine strategy is better than adopting no strategy at all.

The research illustrates that by using a Stochastic Efficiency with Respect to a Function (SERF) and Cumulative Distribution Function (CDF) that the use of five basic routine marketing strategies can be more rewarding. These basic strategies are:
• Put (plant time)
• Twelve-segment pricing
• Three-segment pricing
• Put (pollination)(Critical Moment in production/marketing process), and
• Pricing during pollination phase.

These strategies can be adopted by farmers without an in-depth understanding of the market and market-signals. Farmers can save as much as R1.6 million per year on a 2000ha farm with an average yield.

The results obtained from the research illustrate that each strategy is different for each crop. Very important is that the hedging strategies are better than no hedging strategy at all.

This research can also be applicable to the procurement side of the supply chain.

Maize milling firms use complex procurement strategies to procure their raw materials, or sometimes no strategy at all. In this research, basic routine price hedging strategies were analysed as part of the procurement of white maize over a ten-year period ranging from 2002–2012. Part of the pricing strategies used to procure white maize over the period of ten years were a call and min/max strategy. These strategies were compared to the baseline spot market. The data was obtained from the Johannesburg Stock Exchange’s Agricultural Products Division better known as SAFEX.

The results obtained from the research prove that by using basic routine price-hedging strategies to procure white maize, it is more beneficial to do so than by procuring from the spot market (a difference of more than R100 mil).

Thus, it can be concluded that it is not always necessary to use a complex method of sourcing white maize through SAFEX, to be efficient. By implementing a basic routine price hedging strategy year on year it can be better than procuring from the spot market.

Understanding the Maize Maze by Dr Dirk Strydom and Manfred Venter (pdf) - The Dairy Mail


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