“Remarkable resilience.” This is how agriculture, land reform and rural development minister Thoko Didiza describes the performance of Mzansi’s agricultural and agro-processing sector after it has posted quarter-on-quarter export growth of 12% in the second quarter of the year.
The country has exported R51 billion’s worth of maize and wheat, citrus, wine and grapes, apples and pears, dates and figs, avocados, nuts, fruit juices, sugar, wool, and some other commodities. This, despite major challenges that the export industry has had to face, including FMD-related trade bans, logistics challenges and more restrictive citrus regulations by the European Union.
The minister is particularly pleased that South Africa has kept a presence in all its most important destination countries.
“The African continent remained the largest agricultural export market for South Africa in the second quarter of this year, accounting for 35% in value terms,” she says.
Asia came in second at 28%, the EU third at 21%, the United Kingdom took on 7% of South Africa’s exports, and the Americas took the balance of 9%.
In the same quarter, Mzansi imported R29 billion’s worth of agricultural products, the bulk of which came from wheat, rice, and palm oil.
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Didiza says she is committed to help expand South Africa’s exporting prospects, in line with private-sector stakeholders’ interest in China, India, Japan, Saudi Arabia, Bangladesh, the Philippines and South Korea.
“We seek to deepen our agricultural trade with these countries while maintaining our presence in all other trade partners that continue to support our export-oriented agricultural sector.”
Overall decline of 7.7%
Meanwhile, according to Stats SA, the agricultural industry overall has decreased by 7,7%.
Agbiz chief economist Wandile Sihlobo says it is “unsurprising” given the challenges that many of the industry’s sub-sectors have had to face.
“For example, the livestock industry, which accounts for roughly half of the sector’s gross value added, continues to suffer from foot-and-mouth disease outbreaks and rising feed costs.
“Moreover, some field crops’ harvests aren’t as robust as the 2020-21 season, due to heavy rains at the start of the season.”
He says these constraining factors have countered robust yields for soybeans, sunflower seeds, and various fruits but added that quarter-to-quarter figures are volatile as a rule, and that year-on-year figures are a better indication of the sector’s performance.
“We expect a mild contraction of between 3 to 5% in 2022, mainly on the back of a decline in some field crop harvests … as well as challenges in the livestock industry.”
Two previous years of solid growth, in which the sector expanded by 14.9% year on year in 2020 and 8.8% year on year in 2021, will also add to the decrease this year.
“In sum, while we are downbeat about South Africa’s agriculture growth prospects this year, we are not suggesting that the sector is in bad shape per se.
“The output in a range of commodities is well above the long-term levels, which speaks to the exceptional performance of the past two years rather than the current production conditions.
“Notably, the sector can return to the growth path if the livestock disease is controlled and if we get a favourable rainy season in the 2022-23 summer.”
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