Land Bank to help drought-stricken SA farmers

The bank says farmers can apply for concessional loans offered at 3 basis points below the prime rate.

Carcas of cattle lost in the drought lie in a field in the Free State.  Picture: Christa Eybers/EWN.

JOHANNESBURG - The Land Bank said investors should not give up on the Agriculture Sector as it sets aside R400 million to assist drought-stricken farmers.

The state-owned bank said farmers can now apply for concessional loans offered at three basis points below the prime rate.

Land Bank Chief Executive Officer Tshokolo Nchocho, said the bank has a vested interest in helping the sector succeed, as should other investors.

"If contribution to the manufacturing basket is quite significant, in other words, primary produce that go into food processing and so on, that contributes closer to 20 percent or so of the manufacturing activity. So it is a significant contributor to economic development."

It said farmers in provinces declared drought disaster areas KwaZulu-Natal, Mpumalanga, North West, Limpopo and Free State could apply for the loans immediately.

"The loans can be used as a source of emergency working capital to minimise further losses to current farming operations, carry over debt as well as to repair and replace weather damaged property and equipment," the Land Bank said.

South Africa last year recorded its lowest rainfall levels since records began in 1904, scorching the key maize crop, which is forecast to be 27 percent lower this year, and parching grazing land used for livestock.