South Africa’s farming sector has faced some tough times recently, but some of the hardship could have been warded off had the country been better at getting the basics right. This was the gist of a webinar presented last week by the Academy of Science of South Africa (Assaf).
The Assaf Annual Science-Business Leadership Forum was centred around the effects of the Russia-Ukraine war and other disasters on South Africa, but the speakers said that basic management principles such as policymaking, risk management, disaster mitigation and even infrastructure upkeep and proper education, could have softened the compounded effect of several disasters that food producers and consumers have had to face in recent months.
These disasters included the restrictions and economic fallout of the Covid-19 pandemic, the ongoing problems with Eskom, rising petrol prices, the global impact of the war in Ukraine and, most recently, the floods in KwaZulu-Natal.
Prof. Heinrich Bohlmann, an associate professor in the department of economics at the University of Pretoria, was first to speak and said that much of the devastation could have been avoided.
No shock absorption
“We do not have plans in place to proactively deal with disasters that might occur,” Bohlmann said. He felt that policymakers in the country were not planning ahead, but were instead being reactionary to the unexpected.
He was even questioning the country’s handling of challenges that could be foreseen. “Why did we not anticipate what could possibly happen to Eskom? We knew about such problems.
“The agriculture industry needs to start planning now for future disasters and be ready when they hit us.”
If urgent attention weren’t given to risk planning and disaster mitigation, South Africa could find itself in similar, economically stressed situations in the future, Bohlmann warned.
“It does not look like we have a plan for when big shocks [in] the world, like the Ukraine-Russia war, happen. It seems like we are always scrambling from one crisis to the other without having an upfront idea of how to deal with the impact.”
Bohlmann cautioned that farmers were still going to be hit hard by fuel price increases because of the war, and added that “too many taxes” such as the fuel and Road Accident Fund levies were exacerbating the impact on farming businesses.
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KZN floods made things worse
To emphasise the long-lasting effects of unexpected disaster, and the need for mitigation, Agbiz chief economist Wandile Sihlobo spoke on the impact of the recent floods in KwaZulu-Natal which he believed could potentially be felt for years to come.
Roughly 30% of South Africa’s dairy herd is in the province, along with 12% of the country’s chicken, eggs, and pigs. Furthermore, almost 81% of the country’s sugar is produced in the province. The province is also a major producer of macadamia and other fruits.
Sihlobo said, “These industries were not spared from the damage by the floods. The South African Canegrowers Association indicated that a substantial area [of] fields were destroyed and require a total replant.
“There was also extensive damage to on-farm infrastructure which, combined with field damage, brought a total financial loss in the province’s sugarcane industry to an estimated R222 million.”
Sihlobo said that, especially considering that fertiliser prices are generally higher due to the Russia-Ukraine war, the replanting process will be costly.
Focus on solid infrastructure
Prof. Nicola Viegi, also from the University of Pretoria, said that basics such as infrastructure development and even quality education needed urgent attention.
“Covid-19 made things look bad. Now, with the floods and the war, it is worse. However, as a country we need to take stock of what really happened and build from there.
“We need to start with [the] infrastructure crisis that the country is facing. Fix our roads so that the economy can start running,” he said.
Viegi further said that a clear fiscal policy could help avoid much uncertainty going forward. “There is a greater need now than ever to increase our capacity to meet up with the growing needs of the world.
“Some of these shocks we are experiencing now will be with us for a very long time. We need to know how to deal with them.”
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