Grain SA, together with partners, organized a march on Thursday to the Johannesburg Stock Exchange (JSE) to express disagreement with the exchange's decision to return to a single reference point system for soybean pricing. This decision, according to the protesters, will create an additional burden on farmers, as soybeans are used as feed for the livestock industry.
Grain SA expressed disappointment with the abandonment of the Multiple Reference Point (MRP) model for calculating soybean location differentials. The organization insists on the need for a fair and transparent determination of soybean prices.
Leaders and producers participated in a peaceful march through Sandton, after which documents were delivered to JSE representatives at their offices on Gwen Lane. The petition, supported by 965 signatures and 511 comments, calls on the JSE to reconsider its decision, conduct a transparent, evidence-based analysis, and implement a pricing system that better reflects the actual movement of grain and the realities of the physical market.
Richard Kriege, Chairman of Grain SA, emphasized that producers clearly articulated their position in a calm but firm manner. He stated that the issue is not just about one reference point, but whether the system reflects the reality of the physical market and if producers can be confident that decisions affecting their business are based on transparent data.
Grain SA added that it maintains concerns that the decision to deviate from the MRP model was not supported by sufficient quantitative data, and that agreed evaluation criteria were not properly considered. A return to a single reference point could lead to transportation deductions based primarily on distance from that point, rather than adequately accounting for regional supply, demand, and actual soybean movement.
The organization continues the technical submission of documents, engagement, and plans litigation, including an urgent application to prevent the implementation of the decision while the matter is contested under relevant procedures to protect producers' interests and ensure a more effective and transparent outcome.
Vandile Sichlobo, Chief Economist of the South African Agricultural Business Association, noted that Grain SA's call for a fair approach to determining soybean prices is an important issue that the JSE must consider. He stressed that farmers must trust the pricing methodology, and it must be fair and reliable, taking into account various regional points of soybean production, processing, and consumption.
Professor Simphiwe Madikizela, Senior Lecturer in Business and Leadership Postgraduate School at UNISA, offered a balanced yet critical view of the JSE's decision. He noted that the key question is not whether the JSE has the authority to change the methodology, but whether reverting to a single reference point leads to a better, more accurate, and transparent valuation of soybean prices in the market. Madikizela added that it should be assessed whether the two-year MRP pilot project led to improvement.
Madikizela also emphasized that agricultural commodities fundamentally differ from financial assets in that location plays a huge role. He considers Grain SA's peaceful march a legitimate form of stakeholder interaction, as farmers are directly affected by the pricing methodology and location differential.
David Mari, Head of Marketing and Information at FNB Agriculture, expressed disagreement with the JSE's decision, stating that it clearly ignored market dynamics.
In its notification regarding the return to the single reference point system, the JSE indicated that the decision was made to ensure greater consistency, simplicity, and predictability for market participants, and noted that it had consulted with stakeholders on the matter.
There is an inconspicuous gap in the UK lending system that South African investors often overlook. Although South Africans have traditionally viewed British real estate as a safe haven due to hard currency, deep markets, and functioning courts, the latter aspect of this system is now undergoing unusual public scrutiny.
This issue is highlighted by a case reported by The South African: a High Court judge froze the sale of two Hilton-branded hotels in London and York. The court is examining whether Cohort Lendco II, a creditor structure of Park Lane Cohort Capital, had the right to appoint administrators to the company behind these hotels after providing financing exceeding R2.1 billion (£94 million).
The company Cohort is challenging this decision. An expedited legal process will begin on October 1st, during which witnesses from both sides will be questioned, and administrators may withhold consent to the sale of any company assets before a verdict is reached.
Behind this specific case lies a fundamental fact about the British market. Approximately 1200 creditors, brokers, and leasing firms operate there as 'Annex 1' entities, according to regulator terminology. This label is meaningless to outsiders as it originates from a schedule included in UK anti-money laundering rules. Essentially, it means these firms must register with a registry maintained by the Financial Conduct Authority (FCA)—Britain's financial supervisory body and a sort of analogue to the FSCA. However, control ends there.
These firms are not authorized or regulated like banks. There are no codes of conduct governing how they treat companies they lend to, and borrowers lack an ombudsman. In essence, all protection rests solely within the loan agreement.
This situation leads to two consequences illustrated by the hotel case. Firstly, speed: when a loan has a qualified floating charge, as it is called in English law, the creditor does not require permission from anyone for enforcement. They appoint administrators themselves, selecting insolvency practitioners who take control of the borrower's business, and the appointment takes effect upon filing. These practitioners are licensed professionals who owe duties to all creditors, and proponents of the system argue that its speed preserves value.
However, no independent party verifies this appointment at the time it is made. Secondly, cost: the only way to challenge a decision is to go to the High Court, which is a fast but very expensive process, as the hotel owner did. The UK has previously faced questions about the fairness of this scheme. In 2002, Parliament repealed the old administrator regime, where a creditor-appointed administrator ran the failing business, owing duties essentially only to that creditor, out of fear that other stakeholders would remain unprotected.
What replaced this system retained some powers: a secured creditor can still independently choose and appoint administrators outside of court. Nevertheless, officials must now owe their duties to all creditors generally. No rule ever touched the selection process itself. There is no requirement for an independent voice in the selection of specialists, no verification of the appointment at the time of its acceptance, and no test for whether the choice made by the enforcing creditor has an inherent bias, regardless of the professionalism of the appointed individuals.
This issue, debated in Britain for a quarter of a century, is now coming into open judicial review. South African readers may notice the contrast with their own system, where liquidation appointments pass through the Master of the High Court—a state institution, not the enforcing creditor.
There is also a more subtle question that sounds paradoxical until one traces the cash flows: what happens if the borrower wishes to repay the debt, but the repayment does not align with the creditor's financial interests?
Short-term secured lending does not generate income from long-term relationships; it earns it through interest and fees over a compressed period. Once such a loan expires, the monthly rate usually increases sharply, often doubling, and exit fees are often calculated based on the final repayment amount, meaning the total debt increases with each passing month.
Add another standard contractual feature of this market, and the picture becomes complete: the creditor usually retains veto rights over any sale or refinancing of the asset, i.e., over the very transactions that could repay them. The creditor in this position controls the pace of their own repayment while the clock runs at an elevated rate.
In such a configuration, there is nothing compelling the interests of the creditor and the borrower to align. English commercial law imposes no general duty of good faith between contracting parties, so the creditor exercising its contractual rights is broadly free to exercise them in its own self-interest.
Property law has historically asserted that a borrower who pays everything due should be allowed to discharge the debt, but defending this principle against a resistant party requires going to court, incurring costs and delays, while the debt accumulates.
None of this describes the behaviour of any specific creditor; it describes the structure of incentives that the current body of rules leaves entirely unregulated. It is this configuration—the ticking clock, the ready payer, and the silent body of rules—that makes debates about oversight more than academic for anyone whose asset secures such a loan.
The regulatory landscape is changing, and the Financial Times UK has tracked this shift. Following the collapse of the broker lender Market Financial Solutions, valued at R29 billion (£1.3 billion), which left creditors with a deficit of £1.3 billion, of which approximately £250 million is unaccounted for, the FCA plans to request information on the business models and financial crime risks from approximately 900 'Annex 1' firms it has not yet checked, having already gathered it from 300, with the stated aim of identifying and preventing financial crime risks in the sector.
Its Head of Enforcement, Steve Smart, stated clearly the significance of this for involved firms: whether a firm is registered or applying for registration, it 'should expect questions from us about how it conducts its business, where its risks lie, and how those risks are managed.'
Two specific regulatory concerns require investor attention. The FT reports the FCA's worry that some of these unregulated companies rely on the parent company's anti-financial crime measures or on standard procedures designed for entirely different types of businesses. Regulator concern is also noted regarding people being incentivized to create their own companies to access unregulated bridge financing, making them more vulnerable in case of problems. Anyone ever offered such a route to obtaining property credit in the UK should hear a warning bell in this proposition.
Meanwhile, new applicants for 'Annex 1' registration have been told to expect a slower and more skeptical process. Whether all of this will lead to a full regulatory regime remains a question that British policy will answer over the next year.
South African readers learn the form of this gap. South Africa's consumer credit legislation strictly regulates consumer lending, but corporate lending with assets or turnover exceeding R1 million falls completely outside its scope. The British analogue of this gap operates on a much larger scale, with Rand invested from Johannesburg and Cape Town falling within it.
So, what should an investor with exposure to the UK, or one planning to gain exposure, do? Six questions should be in every conversation before signing an agreement. Is the creditor FCA authorized or merely registered as 'Annex 1', because the difference is between regulation and contract. What exactly triggers default and what rate applies afterward, since tiered default rates can transform the loan economy over several months? What consent rights does the creditor retain regarding the sale or refinancing of the asset? What happens on the day of loan repayment if refinancing is close but not completed? What exit fees apply and what is the total repayment amount on the worst day, not the best? And if enforcement ever occurs, whom does the creditor appoint and how much will it cost to challenge them?
None of this implies wrongdoing by anyone in the hotel case: no one claims that Cohort Capital or the appointed administrators acted improperly, and the October court will only decide whether the legal conditions for appointment were met.
The case is important for another reason. It is the first time this enforcement process will be examined step-by-step in open court, and the verdict will be read to every creditor, borrower, and market consultant. The investor on the other side of this process occupies an unusual position in the debate. Butrus El Khoury, who is currently fighting in the High Court to maintain control over the hotels, is not an opponent of the industry he was involved in: several months before the administration was introduced, he publicly stated in the British financial press that creditors operating at this scale should welcome proportional oversight based on the premise that proper due diligence strengthens confidence in what has become an important part of the British financial system.
He publicly stated only that the matter was under judicial review, that the hotels were operating normally, and that his priority was their staff and guests. But the combination he now represents—an investor who demanded rules and then found himself in a situation of scrutinizing what happens in their absence—will likely keep him at the center of these debates far beyond October.
Until then, the practical position for South African capital in UK real estate is simple and unpleasant: the courts are excellent, the regulator is just beginning to arrive, and the contract you sign is the only shield you have.
The Chairman of the Parliamentary Mineral Committee, Miketeko Malaule, expressed concern over the implications of the Constitutional Court's ruling, which annulled the Wild Coast exploration rights held by Shell and Impact Africa.
The Constitutional Court prohibited Shell and Impact Africa from implementing their plans for marine exploration along the Wild Coast. This decision overturned the 2024 Appellate Court order that had granted these companies the opportunity to extend their exploration rights.
The Court found that the local communities of the Wild Coast were not adequately informed about the planned seismic survey and did not have a genuine opportunity to voice their concerns before the exploration right was issued. Furthermore, it was recognized that the illegal process could not be rectified through community consultations more than ten years later.
Malaule stated that this ruling must be adhered to, but warned that the persistent legal uncertainty could negatively affect investments, exploration, and job creation in South Africa's offshore oil and gas sector.
He emphasized that the country cannot afford to let potentially significant economic opportunities and job creation initiatives remain at a conceptual stage due to exploration uncertainty. Malaule noted that exploration is the process of determining the presence of resources and the possibility of their subsequent development for the benefit of the South African economy and its people.
In Malaule's view, economic development and environmental protection should not be seen as mutually exclusive goals. He believes that South Africa needs a regulatory framework that simultaneously protects the environment and the rights of affected communities while providing investors with sufficient confidence to conduct responsible exploration.
He warned that if the uncertainty continues to indefinitely delay exploration, there is a risk of losing investments and opportunities for economic growth, skills development, and employment. Moreover, Malaule noted that South Africa must remain competitive among other resource-rich countries in attracting investment for exploration and developing its resource base.
