Market Agents are the link between the farmer and the buyer on the market. Farmers send their produce to their chosen market agent (and market), who then endeavours to obtain the best possible price.
According to the Agricultural Produce Agents Act no 12 of 1992, a fresh produce agent is “an agent acting as such with regard to any agricultural product specified in Part A of Schedule 1 on the basis that the risk of profit or loss at all times remains with the principal.” (The principal is the farmer / producer).
Market Agents earn commission on the gross value of produce sold.
What determines the price of the fresh produce on the market?
Successful free markets are defined by the price discovery mechanism. The farmer remains the owner of the product until it is sold. Agents represent farmers helping them find buyers at the best possible prices. The challenge is to decide at what price to sell the product. Price discovery is led by the interactions between buyers and sellers with price fluctuations influenced by demand and supply dynamics, logistics and transport forces, weather and production challenges.
South Africa’s markets
The Agricultural Produce Agents Council (APAC), a statutory body established in terms of the Agricultural Produce Agents Act, 1992 (Act 12 0f 1992) recognises 25 official fresh produce markets in South Africa which includes 4 regional markets.
Most are municipal-run but there are a few that are privately owned such as Butterworth, Cape Town, King Williams Town, George, Nelspruit, Noord-Einde and Uitenhage. Municipal officials act as market managers who deliver services and manage the income of markets from the rental of facilities and other supporting business on the premises. Each market is slightly different in layout but generally, the same produce is grouped together e.g. fruit, vegetables, tomatoes, potatoes and onions.