South Africa's agricultural landscape has navigated a tumultuous path this year, beset by challenges ranging from mid-summer droughts that have impacted field crops to the repercussions of animal disease affecting livestock.
Yet, amid these adversities, a glimmer of optimism emerges within the horticultural sub-sector, with robust harvests in various fruits signalling a potential turnaround.
Wandile Sihlobo, chief economist at the Agricultural Business Chamber (Agbiz), yesterday articulated this mixed picture, noting, “Several high-frequency data releases these past few quarters have mirrored this environment of mixed fortunes.”
As the curtain fell on the third quarter, new data unveiled a promising narrative of resilience, particularly regarding the sector's export performance.
According to Trade Map, South Africa's agricultural exports reached an impressive $4.12 billion during the third quarter, marking a 5% increase compared to the same period last year.
For the first three quarters of the year, cumulative export values soared to $10.55bn, reflecting a 4% uptick from 2022. This surge has been fuelled by not only an increase in the volume of exports but also significant price hikes for several key agricultural products.
Sihlobo acknowledged ongoing logistical challenges but highlighted the collaborative efforts between Transnet, private sectors, and various logistical organisations that are ensuring a steady flow of agricultural products.
“The continuous movement of goods, even amidst periodic delays, demonstrates the sector's tenacity,” he said.
The primary export products by value have included a diverse array of items such as citrus fruits, nuts, maize, apples and pears, and wine.
From a regional outlook, the African continent has maintained its position as the dominant market for South Africa's agricultural exports, accounting for 39% of the total export value. Key exports in the region include maize, wheat, sugar, and apples.
Following closely, Asia and the Middle East represented 25% of total agricultural exports, primarily comprising citrus fruits, beef, and wine. The European Union (EU) stood as the third-largest market, taking 20%, including a significant assortment of fruits, juices, and wool.
Despite these export successes, South Africa’s agricultural landscape is not solely about bounty—it also faces the realities of imports. In the third quarter alone, agricultural imports hit $1.99, a notable 12% rise year-on-year.
Over the first three quarters, cumulative imports have risen by 6% to $5.52bn, driven largely by increased volumes of essential products like wheat and poultry.
Sihlobo highlighted the importation necessity for staples such as rice and palm oil due to South Africa's unfavourable cultivation conditions, noting that nearly half of the nation's wheat consumption is reliant on imports.
Despite the challenges posed by imports, South Africa's agricultural sector remains buoyant. The trade balance showcases a surplus of $2.12bn, albeit down by 1% from the previous year; the year-to-date trade surplus climbed by 3% to $5.03.
Looking ahead, optimism remains for upcoming seasons.
The National Agricultural Marketing Council’s SA Fruit Trade Flow Report forecasts a promising recovery in the stone fruit sector, particularly for apricots and plums, underpinned by improving climatic conditions and enhanced logistics.
“The industry’s capacity to diversify markets alongside robust domestic demand highlights its resilience and critical role within South Africa’s economic framework,” Sihlobo said.
He also emphasised that ongoing investment in climate resilience, efficient logistics, and strategic market diversification will be essential as the agricultural sector continues to navigate its mixed fortunes.
BUSINESS REPORT