Economic returns of the Agricultural Research Council’s Table Grape Cultivar Development Programme in South Africa

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Mazwane, Sukoluhle
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African Economic Research Consortium
The table grape industry, in line with national policy imperatives such as the National Development Plan (NDP), plays an important role in the South African (SA) economy through employment creation, rural development and foreign currency earnings. The industry has continued to expand over the years. The yields of table grapes have increased considerably in South Africa. For continued growth and sustainability, research and development (R&D) initiatives, among other factors, are important. The Agricultural Research Council’s (ARC) Table Grape Cultivar Development Programme (TGCD) is an R&D initiative that supports the industry with breeding of table grape cultivar varieties suitable for SA conditions. It was established in 1952, and has successfully bred 37 table grape cultivar varieties. However, the impact of the programme on yields and contribution to the economy remains unknown. Therefore, the study sought to estimate the economic returns of the ARC’S TGCD to the South African economy. The impact of the ARC TGCD programme was estimated using a two-stage approach. In the first stage of analysis, the impact on yield of table grapes was estimated using the Just-Pope production function. The first stage of analysis addressed two specific objectives: to determine the yield gains attributable to the ARC’s TGCD Programme; and to determine whether attempts to increase yields and quality of table grapes has compromised yield stability. The second stage of analysis employed a benefit-cost analysis to quantify the benefits in monetary terms. Specifically, BCR and MIRR were estimated. Expert advice was used to select seven ARC popular varieties for which data was available in complete form, for the period 2008 to 2017.
Economic returns, Table grapes, ARC, Just-Pope, Benefit Cost Analysis