Diversification: careful planning hedges risk

With so many variables in the farming landscape, diversification is a useful strategy to hedge one's risk and ensure a steady cash flow. However, managing multiple divisions comes with its own challenges. Jan Grey, who farms in Mpumalanga's Bethal region, spoke to Lindi Botha about his winning strategies.

- Lindi Botha

Fourth-generation farmer Jan Grey inherited a diversified farming business when he took up the running of the Janvos Landgoed farm in Mpumalanga’s Bethal area.

However, continuing with the mix of activities has never been set in stone, and choosing what to pursue and what to exclude from the operation are factors that Grey must constantly and carefully weigh up to ensure the success of the business.

Having been at the helm of Janvos Landgoed for the past 30 years, Grey has overseen its transition from a casually diversified farm to an enterprise where each division has a specific purpose.

“When I was growing up, farms had a bit of everything – there were a few chickens, a couple of ducks, and a patch of maize. It was more of a lifestyle than a specialised business. But today, it’s a highly focused industry that needs to be run exactly right, or there’s no place for you on a farm,” says Grey.

“It’s very easy to go bankrupt in farming. Those who continue to make a success of it are truly remarkable and they are farming big, well and right. There are so many challenges facing farmers in South Africa, and they need to be at the top of their games to keep succeeding,” he adds.

In 1994, when Grey joined his father Vos on the farm, Janvos comprised a small dairy, a Merino sheep stud and commercial herd, a commercial cattle herd, and grain crops. Grey increased the size of the dairy and boosted the technology therein, and added a Boran cattle stud, grass-seed production and an apple orchard.