This paper explores the nature and dynamics of poverty in the context of continued and relatively sustained economic development and growth in a Western Cape district (Ceres), one of the centres of South Africa’s deciduous fruit export industry. It considers whether the concept of social exclusion can help in making sense, especially in terms of policy, of these dynamics. The paper summarises some of the key policy responses developed to address poverty and inequality after the transition to democratic rule in 1994; highlights some of the most important trends in the sector; and discusses key aspects of livelihood activities and problems among households. The paper emphasises that it is necessary to understand the intimate and mutually reinforcing links between poverty and the lack of power of poor households in Ceres. The lack of the basic assets necessary for household food production or entrepreneurial activity, and the consequent dependence of households on insecure paid jobs and on networks of patronage renders them and their members profoundly marginal. The paper suggests that while focusing on social exclusion helps draw attention to power relations, powerlessness, and the processes that perpetuate these, coming up with workable policy responses to social exclusion requires developing a much more nuanced analysis of social processes. It is important to understand not only household-level livelihood components, but the local, regional and global institutions, power relationships and processes that perpetuate and create marginality. Ultimately, tackling chronic poverty requires tackling those power relations. Rather than narratives of inclusion and integration, it may be that narratives of empowerment and differentiation are needed.