This article examines the changing governance structures in the South African agri-food sector. Changing legislative and market conditions forced agribusiness managers to rethink their governance structures to ensure the competitiveness of the agri-food sector. They had to adapt to the new structures in a relatively short time. Three case studies of different levels of coordination between firms are presented. The analysis indicates a move away from spot markets to managed coordination structures in response to the deregulation of South African agricultural policy.
AllenD. (2000), ‘Transaction costs’, in BouckaertB., and De GeestG., eds, Encyclopedia of Law and Economics (Volume One: The History and Methodology of Law and Economics), Edward Elgar, Chelthenham, pp 893–926 (accessed September 2007 at Website: http://encyclo.findlaw.com/0740book.pdf).
2.
BayleyB. (2000), A Revolution in the Market: The Deregulation in South African Agriculture, Oxford Policy Management, Oxford.
3.
EsterhuizenD. (2006), ‘An evaluation of the competitiveness of the South African agribusiness sector’, PhD thesis, Faculty of Natural and Agricultural Science, University of Pretoria, South Africa.
4.
FadiñoM.ÁlvarezC. J.RamosR., and MareyM. F. (2006). ‘Agricultural cooperatives as transforming agents in rural development: The case of Galicia’, Outlook on Agriculture, Vol 35, No 3, pp 191–197.
5.
HarriganK. R. (1983), Strategies for Vertical Integration, Lexington Books, Toronto.
6.
HobbsJ. E. (1997), ‘Measuring the importance of transaction costs in cattle marketing’, American Journal of Agricultural Economics, Vol 79, November, pp 1083–1095.
7.
HobbsJ. E., and YoungL. M. (1999), Increasing Vertical Linkages in Agrifood Supply Chains: A Conceptual Model and Some Preliminary Evidence, Research Discussion Paper No 35, Trade Research Center, Montana State University, Bozeman, MT.
8.
National Department of Agriculture Website: www.nda.gov.za.
9.
OECD (2006), ‘Agricultural policy reform in South Africa’, OECD Policy Brief, April, Website: www.oecd.org.
10.
PetersonH. C., and WysockiA. (1997), ‘The vertical coordination continuum and the determinants of firm level coordination strategy’, Staff Paper, No 97–64, Department of Agricultural Economics, Michigan State University, East Lansing, MI.
11.
PetersonH. C.WysockiA., and HarshS. B. (2001), ‘Strategic choice along the vertical coordination continuum’, International Food and Agribusiness Management Review, Vol 4, pp 149–166.
12.
South African Yearbook (2006), South African Yearbook 2006–2007, Government Communication and Information System, Website: www.gcis.gov.za.
13.
SPGO (2001), ‘Minutes of the Area Management Meeting, 8 February 2001’, Sandveld Potato Grower Organisation, Piketberg, Western Cape.
14.
VinkN., and KirstenJ. F. (2000), ‘Deregulation of agricultural marketing in South Africa: lessons learned’, The Free Market Foundation, Sandton, South Africa.
15.
WilliamsonO. E. (1991), ‘Comparative economic organisation: The analysis of discrete structural alternatives’, Administrative Science Quarterly, Vol 38, pp 269–296.
16.
WilliamsonO. E. (1996), The Mechanisms of Governance, Oxford University Press, New York.
17.
ZuurbierP. J. P. (1996), ‘Market structure and vertical coordination’, in TrienekensJ. H., and ZuurbierP. J. P., eds, Proceedings of the 2nd International Conference on Chain Management in Agri- and Food Business, Ede 30–31 May, Wageningen Pers, Wageningen.
18.
ZuurbierP. J. P. (2000), ‘On designing governance structures for supply chains’, in TrienekensJ. H., and ZuurbierP. J. P., eds, Chain Management in Agribusiness and the Food Industry, Proceedings of the 4th International Conference on Chain Management in Agri- and Food Business, Ede 25–26 May, Wageningen Pers, Wageningen.
19.
ZuurbierP. J. P.TrienekensJ. H., and ZiggersG. W. (1996), Verticale Samenwerking, Kluwer Bedrijfsinformatie, Deventer.