After a notable uptick in the first quarter of 2025, the Agbiz/IDC Agribusiness Confidence Index (ACI) fell by five points in the second quarter to 65, said Agbiz senior economist Wandile Sihlobo.
According to the index, most respondents pointed to the uncertain global trade environment, lingering geopolitical tensions, and the domestic animal disease challenge as key factors constraining the sector.
“The better summer rains and improvements at the ports, which have enabled exports with minimal interruptions, are some of the positives. This survey was conducted in the second week of June, covering various agribusinesses operating in all agricultural subsectors across South Africa,” Sihlobo said.
The Agbiz/IDC Agribusiness Confidence Index reflects the perceptions of at least 25 agribusiness decision-makers on the 10 most important aspects influencing a business in the agricultural sector. Agribusiness executives, policymakers, and economists use it to understand the perceptions of the agribusiness sector, and it also serves as a leading indicator of the value of agricultural output, providing a basis for agribusinesses to support their business decisions.
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Influence of external factors
“The turnover subindex confidence is down by 5 points to 55 in Q2 2025. We observed a deterioration in sentiment among agribusinesses operating in the red meat sector, while others maintained a roughly unchanged view from the previous quarter. Similarly, the net operating income subindex fell by 5 points to 65 points in Q2 2025. The drivers were the same as the turnover.
“The sub-index measuring export sentiment volume fell by 40 points to 60 in Q2 2025. This is still a relatively favourable level.. For example, in Q1 2025, South Africa’s agricultural exports totalled US$ 3.36 billion, up 10% from the same period a year ago, according to data from Trade Map. Thus, the decline in sentiment in Q2 is a normalisation,” the index stated.
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The index also indicated that the employment subindex remained flat from the previous quarter at 55 points in Q2 2025. The generally favourable sentiment reflects the upbeat production conditions in field crops and horticulture.
“The general agricultural conditions subindex remained unchanged at 80 points from the first quarter of 2025. This mirrors the positive effects of La Niña rains in the 2024/25 summer season, which has boosted the production conditions in field crops and horticulture,” the index stated.
Sihlobo said the dominance of geopolitical concerns among respondents’ views illustrates South Africa’s agricultural sector’s strong dependence on export markets and the need to diversify markets.
“China, India, Saudi Arabia, and Egypt are among the key markets we should expand into. Still, as we drive the diversification, we must work vigorously to retain the access we have in various markets in the EU, UK, Africa, Asia, Middle East and Americas, amongst others.
“Also important is the collaborative efforts between business and government on addressing the biosecurity issues in South Africa’s agriculture, along with pushing for more efficient network industries, better management of the municipalities, and the implementation of the Agriculture and Agro- processing Master Plan, which is key for the long term growth of the sector,” he said.
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