Logistics will again be tested in 2021. SA is gearing up for another year of a large agricultural harvest and therefore large export volumes, especially in the horticulture and field crop subsectors.
Despite a vibrant agricultural sector, there are a standard list of challenges that South African agribusinesses commonly cite – land reform policy, droughts and infrastructure are amongst the most frequently cited. However, a growing challenge facing firms – particularly those in beef, wool, fruit and wine – is the need to identify new markets.
South African agricultural stakeholders want to increase exports to BRIC(S) countries. This message came sharply in a hybrid event the Agricultural Business Chamber of SA (Agbiz) had with its members, commodity organizations and government representatives on March 19.
South Africa’s agricultural exports amounted to US$10,2 billion in 2020, which is a 3% increase from the previous year. This is the second-largest level after the record exports of US$10,7 billion in 2018. The top ten exportable products by value were citrus, grapes, wine, apples and pears, maize, nuts, sugar, wool and fruit juices.
The government is drafting a localisation strategy as part of measures underpinning its economic reconstruction and recovery plan. The agriculture, food & beverages sector has accounted for about 8% of SA’s annual imports over the past five years, an average value of $6.5bn. This makes it a worthwhile sector to be explored in promoting localisation.
The combination of a large harvest, joint efforts between the government and the private sector to keep agriculture operational since the outset of the Covid-19 pandemic and the lockdown, and long-term export market development efforts continue to pay off for SA’s agricultural sector. In the third quarter, the country recorded record exports of $3.2bn, a 5% increase year on year. The growth was primarily underpinned by citrus, wine, maize, nuts, deciduous fruit and sugar cane.