by Wandile Sihlobo | May 17, 2025 | Agricultural Environment and Natural Resource
South Africa maintains a principle of openness in agricultural trade, limited to no restrictions if commodities meet our specifications and follow the appropriate import regulatory standards.
We spend just over US$7 billion each year importing agricultural products that we don’t produce in large volumes. Still, we export just under US$14 billion, making us a net exporter of farm products.
But when animal disease risks exist in countries we import from, we must act swiftly, following global practice, and limit the imports of the affected products. Thus, when I learned that Brazil had an avian influenza outbreak, it became clear that the appropriate step was temporarily suspending Brazil’s poultry imports into South Africa. We will not be alone in this step; China and the EU have just suspended Brazil’s poultry product imports.
Indeed, South Africa is not self-sufficient in poultry; we import roughly 20% of our annual consumption. The suppliers for various cuts include Brazil, the US, Argentina, and the EU.
But Brazil has a sizable share in imports of around 70% annually. Still, given that we have struggled to address avian influenza in our domestic industry for some time, the appropriate step right now is to temporarily suspend imports of poultry products from Brazil until they are cleared.
Still, the regulator and policymakers must decide on this issue independently. I am merely making these remarks, judging from what we observe in China and Europe and our experiences with animal diseases.
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by Wandile Sihlobo | May 14, 2025 | Agricultural Environment and Natural Resource
While I remain optimistic about South Africa’s agricultural prospects for 2025, I must acknowledge that the recovery will likely be uneven across value chains and regions.
Some areas, mainly summer grains and oilseeds, will take a while to fully recover financially from the pressures of the past season’s mid-summer drought. In the 2024-25 season, which is generally favourable, the excessive rains in April may also have caused crop quality damage in a few areas, bringing a slight financial strain.
In the case of livestock, some are still recovering from the recent animal disease outbreaks and are now affected by new ones. Animal diseases will also add immense economic pressure on beef farmers, especially in the current environment where consumers can’t absorb much of the products, and exports are key to the industry’s sustainability.
These reasons, amongst other factors, will also cause the agricultural jobs market to be less robust than we anticipated at the start of the year. For example, in the first quarter of 2015, South Africa’s primary agriculture employment increased mildly by 1% from the last quarter of 2024 to 930k jobs. Field crops, game, and hunting are the subsectors that underpin this improvement in employment conditions.
However, from an annual perspective, the employment was down 1%, unchanged from the first quarter of 2024.
From a regional perspective, the Eastern Cape, Free State, KwaZulu-Natal, North West, Gauteng and Mpumalanga are the provinces that registered quarterly job losses. Meanwhile, the Western Cape, Northern Cape and Limpopo underpin the mild job gains.
The upside is that the primary agricultural employment of 930k people is well above the long-term jobs of 799k.
Of course, we worry when the farm jobs market is less robust. Many small towns across South Africa heavily rely on agricultural employment, and they will also feel burdened if the job market isn’t recovering quickly.
But this is all near-term discussion. The big focus should remain addressing long-standing challenges, such as port inefficiencies, poor rail and roads, crime and stock theft, animal diseases, and worsening municipal service delivery.
Of course, releasing the government’s 2.5 million hectares of land with title deeds to carefully selected beneficiaries, providing blended finance support, and partnering with the commodity association are additional key interventions to improving jobs and agricultural output.
These issues are within the domestic policy makers’ control, and can be resolved quickly if there is a drive and a will. The path to addressing them is outlined in the government documents, such as the Agriculture and Agro-processing Master Plan, and my book, A Country of Two Agricultures. So we have a choice on whether to maintain the sector and keep the current employment levels or push through with reforms that would fundamentally enhance growth, boost inclusion, and create more jobs. However, in the near term, the recovery will likely remain uneven.
Still, I must close by emphasising my point: we believe this will be a year of recovery for South Africa’s agriculture. However, it will most likely be uneven.
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by Wandile Sihlobo | May 13, 2025 | Agricultural Environment and Natural Resource
There is optimism in South Africa’s agriculture. We know this from various indicators, such as the Agbiz/IDC Agribusiness Confidence Index (ACI), which has increased in the first quarter of 2025 compared to the end of last year.
The ACI increased 11 points from the last quarter of 2024 to 70 in the first quarter of 2025. This is the third consecutive improvement, placing the Index at its highest level since the quarter of 2021, a year of La Niña rainfall that boosted agricultural output. The current level of the ACI implies that South African agribusinesses remain optimistic about business conditions in the country. This was done in February based on surveys of various agribusinesses nationwide.
And yes, the results may have changed somewhat compared to the time of the survey. However, appreciating that favourable agricultural conditions underpinned the optimism from the start, there is reason to believe things wouldn’t be as different even if the survey were done now.
This survey aside, one would not miss the optimism at agricultural shows nationwide. For example, on May 13, I spent my day in Bothaville in the Free State at NAMPO, the premier agricultural exhibition in the Southern Hemisphere. It was well attended, and the mood was upbeat amongst farmers, agribusinesses, the general public, and exhibitors.
I also participated in a panel discussion hosted by Nation In Conversion. In front of a packed studio audience, we focused on South Africa’s agriculture outlook. We covered agricultural production, trade, macroeconomic conditions, and the global political environment, among other themes.
Agri SA CEO, Johann Kotze, said farmers will always find opportunities and continue with what they know best—farming—regardless of what people say, locally and internationally. Political analyst and pollster Dr Frans Cronje expressed optimism about South Africa’s trade prospects with the US and China, recognising the current glitches with the US. Economist Maarten Ackerman highlighted the reforms under Operation Vulindlela and the progress being made, saying there will be many more green shoots.
Clearly, the sector’s optimism is not baseless. It is anchored on some fundamental reforms underway. We are also fortunate to have had favourable weather conditions that supported agriculture this season, notwithstanding the animal health challenges in the livestock industry.
Walking at NAMPO, one is confronted by massive exhibition stands in a large open field. Here, you find the latest agriculture equipment, insight into new seeds and genetics, and a range of technologies in the food, fibre, and beverage value chains. These are global and local companies.
You also would not miss the various livestock breeds that breeders exhibit, illustrating the improved genetics that power our industry.
Bankers also seek opportunities to oil the agricultural industry through various finance options.
The various organisations interact with their clients and potential clients in a relaxed environment and make substantive investment deals that underpin the sector’s competitiveness.
The various commodity associations, anchors of South Africa’s commercial agriculture, were also present, and multiple stakeholders were engaged.
The farmstalls would not miss the opportunity to showcase the cuisine and “koeksisters”, amongst other delicacies, one would typically find in rural South Africa.
The members of the public — young and old, established and aspirant farmers — were there in droves to feast on the NAMPO activities.
The bonus for this year’s exhibition was the first citizen, President Cyril Ramaphosa, who graced the occasion as a farmer. Of course, those in the livestock and wildlife industries would know him as a breeder and a keen farmer. He arrived in the morning, and by the time I left NAMPO at 4 pm, farmer Ramaphosa was still rubbing shoulders and sharing insights with his counterparts.
He enjoyed the company of great South African farmers who were optimistic about the future of agriculture and our country. There remains optimism in the South African farming.
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by Wandile Sihlobo | May 9, 2025 | Agricultural Environment and Natural Resource
South Africa has some contradictions. We are a leading agricultural exporter in Africa, yet many households are food insecure.
Without proper policy engagement on this challenge, the sector risks more misconceptions about its export-driven growth drive, while many South Africans are impoverished. Accurately diagnosing the problem and its underlying causes is critical to formulating a suitable policy response.
In February 2025, Statistics South Africa released the Food Security Report for 2019, 2022 and 2023 (COVID-19 affected the ability to collect data in 2020 and 2021 ). The report utilised data from the General Household Survey (GHS) for those years.
The report’s most striking observation was that:
“the proportion of households in South Africa that experienced moderate to severe food insecurity was estimated at 15.8% in 2019, 16.2% in 2022, and 19.7% in 2023. Over this period, the proportion of households that experienced severe food insecurity was estimated to be 6.4%, 7.5%, and 8.0%, respectively.”
Deteriorating food security is not due to a lack of nutritious, high-quality food, safe food products, or high prices. Access seems to be the fundamental challenge, especially for households with no regular income sources.
Therefore, addressing income poverty at the household level must be the centre of any strategy to address food insecurity.
This challenge cannot be resolved by the agricultural sector alone but through coordinated efforts to grow the South African economy, lift employment across various sectors, and provide appropriate support to vulnerable households.
Despite the concerning trend in Stats SA’s survey, South Africa remains food secure and is a net exporter of agricultural products at the national level. Exports are necessary for sustaining farming incomes, generating the resources needed for investment, and ultimately, the sector’s ability to create and maintain jobs.
Notably, South Africa does not export its food supplies without appropriately considering the domestic food needs at the national level. Moreover, the country’s food prices remain relatively moderate. Despite this, food insecurity will remain a challenge if households have little to no income.
One measure some researchers use to evaluate the food security condition of each country relative to the world is The Economist’s Global Food Security Index. While slightly dated, the 2022 results show that South Africa ranked 59th out of 113 countries in the index and the most food secure in Sub-Saharan Africa.
South Africa is ranked the second most food-secure country on the African continent after Morocco. When looking at the index scoring, it becomes clear why South Africa’s food security ranking has improved somewhat. South Africa’s scoring came in at 61,7, up from 61,4 in the previous year. The Global Food Security Index comprises four subindices, namely: (1) food affordability, (2) food availability, (3) food quality and safety, and (4) sustainability and adaptation.
Still, the national-level picture may be complex to celebrate in an environment where many households are food insecure. This means that ensuring the economy grows and creates employment is critical.
Better support for boosting output, especially labour-intensive value chains, will be important in agriculture to ensure that more job opportunities are created in South Africa’s small towns. There should also be a stronger focus on revitalising other sectors of the economy, as South Africa’s household food insecurity problems will not be resolved only through agriculture.
Agriculture will play its role where possible, and the path for agricultural growth has been studied and included in the policy thinking. For example, at a technical level, expanding agriculture and agro-processing capacity to boost growth and job creation was well established as far back as the National Development Plan 2012.
They were again highlighted in the 2019 National Treasury paper, the 2022 Agriculture and Agro-processing Master Plan, and, most recently, in my book, A Country of Two Agricultures: The Disparities, The Challenges, The Solutions.
Ultimately, South Africa’s agriculture plays a role in resolving household poverty challenges. However, the responsibility does not lie solely in the sector. Other sectors of the economy can play an essential role in creating work and general fiscal space that can be used for different social causes to improve the quality of life in South Africa.
The growing exports of agriculture are not at the expense of the local supply. They are essential to growing the South African agricultural sector and ensuring that the over 926k people working on farms across the country retain their jobs and that more jobs are created. Through their income, those employed help improve food security conditions in their communities.
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by Wandile Sihlobo | May 6, 2025 | Agricultural Environment and Natural Resource
The easing of the fuel price comes at a critical time for South Africa’s agriculture. Fuel consumption generally occurs throughout the year, but harvesting is one of the highest usage periods. We are harvesting grains, oilseeds and citrus.
Today, May 7, South Africa’s petrol (95 ULP inland) and diesel (0.05% wholesale inland) prices decreased by 22 cents per litre (c/l) and 42 cents per litre (c/l), respectively. The retail price of petrol is now at a record R21.40 per litre, and the wholesale diesel price is R18.90 per litre.
The underpinning driver of the decline in fuel prices is the decrease in Brent crude oil prices, which are influenced by increased oil output in major producers, among other factors.
Fuel generally accounts for a sizable share of farmers’ input costs. For example, for grain farmers, fuel costs between 11% and 13% of production costs.
Beyond the farming side, the general transportation of agricultural products also heavily relies on road transport. Roughly 81% of maize, 76% of wheat, and 69% of soybeans are transported by road. On average, 75% of national grains, oilseeds, and a substantial share of other agricultural products are transported by road. This higher road usage illustrates the decline of rail effectiveness over time and, most importantly, the centrality of fuel to agriculture.
It is also worth noting that the decline in fuel prices, although relatively small, also bodes well for moderating food price inflation.
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by Wandile Sihlobo | May 5, 2025 | Agricultural Environment and Natural Resource
We typically focus on the national level when considering agricultural development and the possibilities of growth and jobs the sector can bring. Most of our plans, such as the recent Agriculture and Agro-processing Master Plan, heavily emphasise the national level.
Consultations are also held nationally to develop or craft these plans. This is an important starting point for establishing a national viewpoint and rallying the support of the various stakeholders.
Beyond this stage lies another critical step: translating the broad national views into provincial and regional plans. This is vital as most agricultural development depends on the local government’s delivery.
The face of the government and the experience of farmers and other stakeholders on the ground are defined by the engagement with the local officials. Therefore, we must have an efficient path of always translating the broad national agricultural programmes into local interventions, which may differ province by province.
I was reminded of this critical step as I began to reflect on the recent news out of my home province, the Eastern Cape, where Premier Oscar Mabuyane announced the new leadership appointment for the various departments.
He selected Mr Bonginkosi Dayimani in agriculture, a deeply respected old hand. I have had several interactions over the years with Dayimani and can confidently say he is aware of the province’s challenges and what needs to be done to address them.
Unlike his predecessors, Dayimani has a much larger and more complex responsibility. Agriculture, agro-processing, and agrotourism, among other sectors, are key to reviving the Eastern Cape’s economy.
Unfortunately, the province has not made admirable progress in these areas despite the much-talked-about possibilities of these sectors in creating jobs and addressing the poverty issues in the Eastern Cape. The Premier of the Province, Oscar Mabuyane, typically gives promising speeches that diagnose the underlying problems. But the delivery remains disappointing.
For example, the province’s agriculture still has a sharp dualism. The former Ciskei regions of the province, with dominant commercial agriculture, are the engine of the provincial agricultural fortunes. Meanwhile, the former Transkei region remains at the periphery of progress.
The challenges of poor land governance, inadequate infrastructure (roads, water, silos, etc.), and absence of organized agriculture for training are among the issues this region faces. As a result, there are tracts of underutilised land in areas with favourable rainfall and fertile land.
The province’s leadership should pull out all the stops to ensure we realise agricultural growth in the province. Dayimani, as a trusted hand, will have to work to change this reality, leaning on the national programmes and policies to guide his work, primarily the Agriculture and Agro-processing Master Plan. He will also have to work closely with the Department of Land Reform and Rural Development to address the poor land governance issues that continue to hinder agricultural progress in the province.
Thankfully, the Minister of Land Reform and Rural Development, too, is well-versed in the challenges of communal land and the pedestrian pace of Eastern Cape agricultural progress and should, I assume, have a sense of urgency to ensure the province makes some improvements.
Progress in provincial agriculture would be an engine for addressing high unemployment and poverty. These would also be highly technical jobs in the value chain.
The Eastern Cape has the potential. However, its leadership must do its part seriously to restart the province. Once we see their efforts, private businesses will follow up and invest. We can’t keep having a rural province with a “potential” never achieved while people suffer.
While I have placed the burden on the Premier and the head of the agriculture department, Dayimani, the people of the Eastern Cape must define their destiny. Pockets of fertile lands remain fallow. People seem to have lost hope in farming for various reasons. The government has also done little to build confidence and provide the necessary infrastructure and a conducive operating environment to return intellectual and physical capital to the province.
Provided agriculture could be revitalised, and supportive infrastructure, agriculture and agribusiness could give far more economic opportunities than we see in some urban regions.
The starting point for all this work should not be for Dayimani to call another conference; it should be taking the Agriculture and Agro-processing Master Plan, choosing the value chains that could be a key focus for the province, and building from thereon. While I haven’t discussed the province’s challenges at length here, they have long been studied and do not require another strategy document.
Of course, a lot will be learned through implementation, which is a much better approach—learning by doing—than consistent planning for every new leader.
We hope the Eastern Cape will be one of the few provinces to adopt the national policy, adapt it to its regional challenges, and improve its agricultural fortunes.
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by Wandile Sihlobo | May 3, 2025 | Agricultural Environment and Natural Resource
You may have noticed the news headlines on Friday, March 2, about global food prices rising. These headlines weren’t necessarily about retail food prices but the mild uptick in the FAO’s global Food Price Index – a measure of the monthly change in international prices of a basket of agricultural commodities.
The Index lifted by 1% in April 2025 from the previous month to 128 points. This is up 8% from the same period last year but still 20% down from its peak in March 2022, a month after Russia invaded Ukraine, leading to a surge in grains and oilseeds prices.
The mild uptick in the prices of grains, dairy, and meat has underpinned the Index’s mild increase in recent months. In the case of dairy and meat prices, there is a rise in demand, particularly in the EU area, combined with tight supplies in some places that have struggled with animal diseases. These will likely be temporary and generally mild as the supplies recover in the coming months.
In the case of grains, the price increases reflect the tighter supplies in the Black Sea region. But this, too, may be short-lived as the general production outlook is optimistic. For example, the International Grains Council forecasts the 2025-26 global grain production to be 2.4 billion tonnes, up 4% from the previous year. This forecast comprises all major global soft commodities – maize, wheat, rice and soybeans.
A closer look at the data shows that the 2025-26 global maize production is forecast at 1,3 billion tonnes, up 8% year-on-year. The uptick is expected to be in all major maize-producing regions worldwide.
The 2025-26 global wheat crop is forecast at 805 million tonnes, up 1% from the previous season. The 2025-26 global rice production is estimated at 540 million tonnes, up 1% from the prior season. The 2025-26 global soybean crop is estimated at 428 million tonnes, up 3% from the previous season.
Admittedly, it is still too early to be confident about these crop prospects, and the northern hemisphere countries have recently started planting. As the season progresses, much will unfold, including whether farmers will grow all the intended areas.
Moreover, the southern hemisphere countries will only start tilling the land towards the end of the year, around October. The forecasts for this region so far are mainly based on historical plantings. What will matter the most from now on are the weather conditions. So far, the prospects remain relatively favourable for most regions; thus, the International Grains Council has maintained this broadly optimistic view of the 2025-26 global grains and oilseeds production.
The better harvests also imply that commodity prices could remain contained for some time, albeit in some cases, where their usage is high and weighing on stock-level prospects.
South African perspective
This is an encouraging outlook for South Africa’s consumer. South Africa generally imports around 1.8 million tonnes of wheat yearly, just under half of the country’s annual consumption. South Africa also imports about a million tonnes of rice, which accounts for all consumption. South Africa does not produce rice because its semi-arid environment requires more moisture.
In other grains, South Africa is a net exporter and has a favourable season in the 2024-5 season, which will cushion the country’s supplies. South Africa’s 2024-25 summer grains and oilseeds are estimated at 18 million tonnes, up by 16% from the previous season, and well above the long-term average levels.
The outlook for the 2025-26 season will be clear later in the year. Currently, we are focused on the crop in the fields. Still, we know that the International Grain Council assumes a continuation of these favourable production conditions.
Other important factors
In addition to the weather, we continue to monitor geopolitical developments and trade policy, as they typically add downward pressure on agricultural commodities when China, a major grains and oilseeds buyer, cancels orders in its efforts to source more produce from South America. This developing issue requires constant observation because it generally disrupts the grain markets.
Aside from that, the outlook for 2025-26 global grains and oilseed production remains broadly optimistic, which supports a view that global food prices may increase mildly or move sideways. Therefore, the news about the rise in global food prices should not be a worry, as it may be a temporary blip due to expected solid production.
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by Wandile Sihlobo | Apr 27, 2025 | Agricultural Environment and Natural Resource
On April 27, we celebrated Freedom Day, commemorating the first post-apartheid elections in South Africa. We are now roughly 31 years into South Africa’s democracy, and many have written extensively about the country’s progress since the dawn of democracy.
It is sufficient to say that, while daily challenges can often leave one feeling despondent, collectively, we have made significant progress in improving the country’s economic conditions.
As individuals, we are, on average, better off by roughly one and a half times in monetary terms.
Of course, the gains would have been much better had we not been hobbled by state capture, among other things.
The agricultural sector, which some have portrayed as a victim of the democratic transition in South Africa, has made enormous progress over time, contributing significantly to the country’s overall economic growth. The sector has more than doubled in value and volume terms since 1994.
This expansion was broadly shared across all major subsectors of the South African farming economy, including horticulture, field crops, and livestock. (For those interested in the details, my colleagues at the Bureau for Food and Agricultural Policy have done a neat analysis of the sector’s progress accessible here.)
Catalysts for South Africa’s agricultural growth
Amongst other interventions, there are two major catalysts behind the sector’s progress.
First, South Africa has adopted technological advancements in agriculture as a means to drive productivity. This entails improved genetics, seed cultivars, vaccines, agrochemicals and fertilisers, amongst other interventions. The better farming skills also help immensely.
Second, the growing emphasis on agricultural trade has been a key driver of progress. South Africa has seen growth in its agricultural exports over time, reaching a record US$13,7 billion in 2024. South Africa is now ranked the world’s 32nd largest agricultural exporter, the only African country in the top 40 in terms of value.
The boom in exports was facilitated by the range of trading agreements the South African government secured over the past decades, the most important ones being with African countries, Europe, the Americas and some Asian countries.
The African continent and Europe now account for approximately two-thirds of South Africa’s agricultural exports, while Asia is also becoming an increasingly important market.
Food security gains
The increase in agricultural output over time is also a major contributor to South Africa’s ranking of 59th out of 113 countries in the Global Food Security Index, making it the most food-secure country in Sub-Saharan Africa.
Admittedly, boasting about this ranking when millions of South Africans go to bed hungry every day may ring hollow. We have a serious food insecurity challenge at the household level in South Africa.
The lack of access to food that many South Africans face is primarily due to income poverty challenges, rather than a lack of availability resulting from low agricultural output, as is the case in other parts of Africa.
In essence, we need to ensure that there is employment and that households have sufficient income to purchase food, or implement various interventions to support them, while being cognizant of the fiscal constraints the country faces.
Robust employment
Even with the adoption of technology that catalyses agricultural productivity improvements, employment in South Africa’s agriculture has remained robust. For example, there were about 922,000 people employed in the industry in 1994, according to data from Stats SA, including seasonal and permanent labour.
While the share of seasonal and regular labour changed over time, broad employment conditions remained vibrant. As of the last quarter of 2024, approximately 924,000 people were employed in primary agriculture.
We have seen more encouraging employment conditions also within the value chain. Notably, the wages have also improved over time.
Inclusivity in South Africa’s agriculture
The agricultural progress of the last 31 years is admirable and provides a solid foundation for further expansion, with a clear focus on enhancing inclusivity. As I argued in my book, “A Country of Two Agricultures”,
“Nearly three decades after the dawn of democracy, SA has remained a country of ‘two agricultures’. On the one hand, we have a subsistence, primarily non-commercial and black farming segment; on the other, we have predominantly commercial and white farmers.”
The book adds that:
“The democratic government’s corrective policies and programmes to unify the sector and build an inclusive agricultural economy have suffered failures since 1994. The private sector has also not provided many successful partnership programmes to foster the inclusion of black farmers in commercial production at scale. It is no surprise that institutions such as the National Agricultural Marketing Council estimate that black farmers account for less than 10%, on average, of commercial agricultural production in SA.”
This lacklustre performance by black farmers in commercial agriculture cannot be blamed solely on historical legacies. The democratic government has a lot to account for in this failure.
Notably, black farmers account for approximately 10% of South Africa’s commercial agricultural output. Still, as I argued in the book;
“What we can also not ignore is the anecdotal evidence pointing to a rise of black farmers in some corners of SA. We see this in field crops, horticulture and livestock in provinces such as Free State, Western Cape, Eastern Cape and other regions.”
Concluding remarks
I have decided to revisit these points because, amid the current climate where some argue that the South African farming sector is under siege, it is easy to fall for such narratives and lose sight of the progress South Africa is making in this critical sector of the economy.
As I highlighted in my book, “A Country of Two Agricultures”, South Africa has great potential to increase the “agricultural pie” by bringing in more new entrant farmers, utilising, as a starting point, much of the government’s underutilised agricultural land of roughly 2.5 million hectares. This land would need to be released with titles to appropriately selected individuals. This can be paired with blended finance support and leaning on the training and support of commodity associations.
The expansion of agricultural activity would bring much-needed jobs in rural South Africa, while also improving the economic vitality and inclusivity. This could be an essential step for this decade to close the gap between the current two agricultural sectors in South Africa.
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