Disruptions caused by the novel coronavirus have reinforced weaknesses in the agricultural sector, experts believe. Issues around finance, liquidity, water infrastructure and policy concerns around land reform remain areas of crisis in the sector amid the global health pandemic, they say.
These sentiments were expressed by the keynote speakers in a webinar hosted by Nedbank Business Banking yesterday.
Agricultural Business Chamber (Agbiz) chief executive officer, Dr John Purchase, and Bureau for Food and Agricultural Policy (BFAP) managing director Professor Ferdi Meyer shared insights on the impact of the global covid-19 health crisis on South Africa’s agriculture as well as the way forward after the pandemic.
Amid the global crisis Purchase and Meyer predict that the sector is set for a robust recovery.
Level three lockdown measures have already brought some much-needed relief to the food supply chain that was shaken up over the past two months. However, the agri-experts said the crisis has brought great uncertainty in the industry.
According to Purchase, the agricultural sector had already been under constraint prior to the global health crisis. The virus, he said, has certainly caused a shake-up in the industry.
“There is great uncertainty around the pandemic. In fact, we have not seen it play out fully both locally and globally. We still have to see what happens.”
Non-food products such as wine, tobacco, mohair and wool had a rocky start under lockdown, Purchase said. A collaborative effort between government and the agricultural sector allowed for the mitigation of losses on the industry.
“The one outstanding issue still remains tobacco,” he said.
Agriculture set to bounce back this year
Despite this, Meyer highlighted that things were looking up in the industry. He says that grain and oil seed production in the country were looking favourable despite disruptions. BFAP predicts that the South African agriculture GDP will grow by 6% this year.
“We have a large surplus in a year of crisis, and in a year where there is severe economic pressure on our low-income households.
“Essentially what this implies is that South Africa has got an abundance of maize meal, which remains our main staple food, so we can push this maize into our local markets.”
Fruit exports are an area of concern, he added. With South African ports running at just 60% it has been a logistical nightmare for the industry to cope with the demand of fruit exports. As it stands, avocados, citrus and macadamia nuts need urgent attention.
“Some of these industries are in the peak harvesting season. We are experiencing bottlenecks in the ports, so it will all be a matter of how effectively we can export the produce out of the country’s borders and into the international markets.”
Despite these challenges in the industry, exports have picked up.
“We are actually expecting a very large citrus crop this year, it’s an all-time record crop. Citrus hectares have expanded by almost 20 000 hectares over the last five or six years. There has been major investment in this industry.”
Purchase said this crisis has proven the resilience of our country’s agro-food system. If we could overcome the former Zuma administration, he said, we can overcome anything.
“We must acknowledge that the Zuma administration turned out to be disastrous for South Africa. We dropped our per capita GDP income from roughly eight thousand US dollars to five thousand.”
“Surviving the way we did through the Zuma administration is an indication of (our resilience) and also through the difficult drought years that we have had.”
Pres. Ramaphosas’s administration is centred around inclusive growth, Purchase said, even through the global health crisis.
“We have managed to keep the wheels turning as far as is possible within the measures that have been announced. I think to accelerate through this recovery we need enhanced capacities and to address process inefficiencies, especially around our ports.”