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20 July 2022 | Story Nonkululeko Nxumalo | Photo Supplied
UFS Academic staff job shadow in Germany
From the left: Helene van der Merwe (Lecturer: Sustainable Food Systems and Development), Herkulaas Combrink (Lecturer: Economic and Management Sciences, and Interim Co-director of the Interdisciplinary Centre for Digital Futures), Prof Dirk Fornahl (Research associate/researcher at Friedrich Schiller University Jena), Dr Karen Booysen (Lecturer: Business Management), Ketshepileone Matlhoko (Junior Lecturer: Sustainable Food Systems and Development), Gretha Lotz (Technopolis intern), Prof Johan van Niekerk (HOD: Sustainable Food Systems and Development), Prof Katinka de Wet (Associate Professor: Sociology, and Interim Co-director of the Interdisciplinary Centre for Digital Futures)


A group of academic staff and PhD students from the University of the Free State (UFS) recently visited the Friedrich Schiller University Jena (FSU) in Germany for a three-week (27 May-16 June 2022) regional innovation training workshop and job shadowing. The opportunity was extended to the university’s Interdisciplinary Centre for Digital Futures (ICDF) as well as the faculties of Natural and Agricultural Sciences and Economic and Management Sciences.

Building a regional innovation cluster for agriculture

With this training, the UFS, in collaboration with the FSU, the Department of Science and Innovation (DSI), the Technology Innovation Agency (TIA), the Department of Small Business Development, Tourism and Environmental Affairs (DESTEA), the Department of Agriculture (DOA), and other industry partners, aims to build a regional innovation cluster for agriculture in the South African perspective that drives innovation, technology advancement, and trade methodology among academic institutions, the government, and industries.

“The collaboration between the UFS and the FSU will have significant benefits for both universities in terms of knowledge sharing and learning. However, the biggest benefit of this project is to build a better community, facilitate innovative solutions for future challenges, and provide academic collaborations,” said Herkulaas Combrink, Interim Co-director of the ICDF.

Another regional innovation cluster in the agricultural sector is arranged within the Cape Winelands region and is centred on wine and liquor production. The projects between the UFS and the relevant stakeholders will grow other agricultural spheres such as textiles, livestock, and diverse crop irrigation.

“We are interested in a broad topic focused on climate change in the challenging context of developmental issues, inequalities, pressing issues of food insecurity, and demands/ opportunities brought about by the Fourth Industrial Revolution,” Prof Katinka de Wet, Interim Co-director of the ICDF, highlighted.

According to Combrink, the UFS has been engaging online and in person with academic staff from FSU since 2021 to build the skills and capacity to drive this regional innovation.

“Academic institutions, government, and industry rely on these integral bridges to drive a sustainable digital future as well as to capacitate the next generation with the skills to increase the level of innovation required to remain relevant in the context of tomorrow,” he also said.



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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