During 2016, the South African Cultivar and Technology Agency (SACTA) was established as a non-profit company. The purpose of the company is to exclusively administer statutory levies for breeding and technology as imposed on certain self-pollinating crops.

It is an established practice for producers to retain the grain of self-pollinating crops, such as wheat, barley, oats and soya beans, for planting purposes in the following season. This is known as farm-saved seed.

Although this practice is legal, the effect thereof is that seed companies sell less seed. Consequently, this reduction in sales makes it unviable for them to invest in the development of new varieties and to ensure that seed companies can introduce modern biotechnology in these crops. Therefore, South African producers do not have access to the latest germplasm and biotechnology.

Introducing an end-point royalty system

The grain and oilseeds industries decided that an end-point royalty system is to be introduced to provide a solution to the problem. The producers pay the royalties (levies) when they deliver, sell or process grain. Relevant seed companies then receive the funds according to their market share. The decision was made to use statutory levies for this purpose, which has proved to be successful.

SACTA thanks the National Agricultural Marketing Council, the Department of Agriculture, Land Reform and Rural Development and the minister of agriculture for their support in making this system a success. Furthermore, the commitment from producers, grain silo operators, grain traders and many administrative staff members involved in managing the system is appreciated, as it has ensured a firm foundation for the statutory system’s success. – Press release, SACTA

Click here to download an electronic copy of SACTA’s annual report for 2020. The report provides detailed background and information regarding the company’s activities, as well as its financial statements for the past four years.