Farming confidence falls amid FMD and trade concerns

The Agbiz/IDC Agribusiness Confidence Index (ACI) fell for a second consecutive quarter by two points to 63 in the third quarter of 2025. Most respondents highlighted the adverse effects of foot-and-mouth disease (FMD) and trade frictions with the United States as their primary concerns.

According to the ACI report, long-running challenges, such as poor service delivery by municipalities and slow progress in releasing government land to beneficiaries with title deeds to stimulate agricultural expansion, are limiting factors.

“Despite the slight decline, the current level of the ACI implies that South African agribusinesses remain optimistic about business conditions in the country. The favourable 2024-25 summer rains and improvements at the ports, which have enabled exports with minimal interruptions, are among the positives.

“The winter crop season is also looking positive for the 2025-26 harvest. This survey was conducted during the last two weeks of August, covering agribusinesses operating in all agricultural sub-sectors nationwide,” the report stated.

Decline in farm jobs and exports

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. This includes turnover, net operating income, market share, employment, capital investment, export volumes, economic growth, general agricultural conditions, debtor provision for bad debt and financing cost.

“It is used by agribusiness executives, policymakers and economists to understand the perceptions of the agribusiness sector, and also serves as a leading indicator of the value of the agricultural output while providing a basis for agribusinesses to support their business decisions,” the report indicated.

Furthermore, the report showed a decline in agricultural employment, export volumes because of concerns about the global trade environment, and general agricultural conditions due to animal diseases.

“The employment subindex declined by 5 points to 50 points in Q3 2025. This mirrors the general employment conditions in the sector. For example, the number of farm jobs in South Africa declined by 3% to 906 000 in the second quarter. We observed a quarterly decline primarily in the livestock industry, certain field crops, and aquaculture.

“The capital investments subindex decreased by 8 points from Q2 to 67. The decline is somewhat surprising as the high-frequency data, such as tractor and combine harvester sales, have remained strong since the start of the year,” the report said.

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Market expansion is essential

The report did include some positives, such as the turnover subindex confidence is up 20 points to 75 in Q3 2025.

Wandile Sihlobo, chief economist of the Agricultural Business Chamber of SA (Agbiz), said these results indicate that the recovery of South Africa’s farming sector will likely be uneven in 2025, with the livestock sub-sector under pressure, while other sub-sectors seem likely to grow.

“The dominance of geopolitical concerns in respondents’ views illustrates the strong dependence of South Africa’s agricultural sector on export markets and the need to diversify these markets. Brics, primarily China, India, Saudi Arabia, and South Africa, 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, the Middle-East and the Americas, amongst others,” he said.

Sihlobo also noted that collaborative efforts between the business sector and the government on addressing the biosecurity issues in agriculture are important.

“Along with pushing for better management of the municipalities, and the release of the government-owned land to appropriately selected beneficiaries. This is key for long-term expansion in the sector,” he said.