South Africa’s agricultural sector continues to show some signs of resilience. With all the challenges this year – from tough production conditions in grains and oilseeds, disease outbreaks in livestock, and trade barriers in horticulture – we still see increasing job opportunities.
In the third quarter of this year, there were 873 000 people in primary agriculture. This is up by 5% year-on-year (while down marginally by 0,1 quarterly). Notably, this is well above the long-term agricultural employment of 780 000. As with the previous quarter, the increased farm activity in some vegetables, fruits and field crops sustained robust employment.
Still, the picture is not all rosy. The livestock, animal husbandry, forestry, and related services subsectors shaved jobs during this period under review. The decline in employment in livestock was expected as the subsector faces the spread of foot-and-mouth disease, which has led to a temporary suspension of exports and a reduction in activity in numerous businesses, thus weighing on farmers’ finances.
Furthermore, the higher feed cost is an additional challenge for the livestock industry. This decline in agricultural jobs was mainly in the North West and Mpumalanga. Nevertheless, the reduction in the business activity in the subsectors mentioned above was compensated by the increasing work opportunities in horticulture and field crops. Thus, other provinces registered positive growth from the third quarter of 2021.
The data for the last quarter of the year will likely present a roughly unchanged view from the third quarter primary agricultural jobs numbers. The horticulture and field crops subsector probably will maintain the current workforce, although input costs have risen notably.
Farmers are optimistic about the 2022/23 production season, and the rains since the start of the quarter are broadly positive for the sector, notwithstanding the planting delays in the grains and oilseeds regions and the destruction of some banana and macadamia fields in Mpumalanga because of excessive rains. The business challenges that the Tongaat Hulett financial difficulties brought to the sugarcane industry will possibly not reflect the agricultural jobs numbers for now.
The agricultural jobs were improved while South Africa’s agriculture continues to face a range of exogenous challenges. I have discussed some of our challenges in these pages, including poorly functioning network industries – roads, rail, ports, water, and electricity- and service delivery problems in municipalities, leading to increased business costs. Resolving these challenges will provide momentum for the long-term growth of agriculture and contribute positively to job creation.
We should also remain mindful that South Africa’s agricultural sector is export-oriented. This means that the expansion in the export markets should support a possible increase in domestic production. This view is widely shared by the agricultural sector role players who have argued for a need to expand export markets beyond the country’s traditional markets. The priority countries should be China, South Korea, Japan, the USA, Vietnam, Taiwan, India, Saudi Arabia, Mexico, the Philippines and Bangladesh. These countries have a sizable population and large imports of agricultural products, specifically fruits, wine, beef and grains. These countries are already on the radar of the South African authorities.
Beyond the export markets and the reforms in the network industries, we also need to ensure that there is progress and success in the land reform programme, an integral part of our agricultural growth agenda. Here the promising idea that has recently been tabled is the Agricultural Development and Land Reform Agency, which I believe could help to accelerate the redistribution pillar of the land reform programme.
The Agency was mentioned on various occasions by South African President Cyril Ramaphosa and Minister of Agriculture, Land Reform and Rural Development Thoko Didiza. I understand that there has been considerable progress in structuring this Agency, and when launched, it could play an important role in land reform, specifically the land redistribution pillar. Ideally, this Agency will have private sector and public partnerships for the good of the new entrant farmers.
In sum, the year 2022 presented various challenges to the sector. Still, the resilience ensured that the core objectives, such as food security and job creation, were met amid the intensified geopolitical and rising input costs largely outside South Africa’s control. The 2022/23 summer season presents prospects of a La Niña, which is already evident from the recent heavy rains across South Africa.
These favourable weather conditions (assuming they won’t be destructive) and farmers’ drive to increase plantings imply that 2023 could be a year of recovery from a potential contraction in 2022. Importantly, accelerated implementation of the much-needed reforms I highlight above in 2023 would be an even more important catalyst for the sector’s long-term growth and job creation. The government must lead the implementation role in programmes such as the Agriculture and Agro-processing Master Plan, complemented by all agriculture role players.
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