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Abstract

The objective of the research was to determine the extent to which marketing in general, and the Mohair Scheme in particular, played a part in the re-emergence of South Africa as the world's leading mohair producer. The two major components of the Scheme, the voorskot, or initial payment, and reserve prices were analysed separately. In the first part of the analysis only rainfall and the market price were found to be important determinants of mohair production. Although the voorskot price was found to be an unimportant determinant it may nevertheless have played an important part in making the Scheme as a whole acceptable to producers. In the second part of the analysis it was established that the reserve price had both stabilized the price of mohair and enabled producers to enjoy welfare gains. It was therefore concluded that the Mohair Scheme had played a major part in the re-emergence of South Africa as the world's leading mohair producer. Nevertheless, in view of the massive stock-piling in recent seasons, due to the reserve price being set too high, it was recommended that the Mohair Scheme be discontinued„ or at least that the reserve price should support only the finer mohair lines and be set at a much lower long-run, market clearing level.

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