by Wandile Sihlobo | Jan 2, 2025 | General Comments
This will likely be a year of recovery in South Africa’s agriculture. Much of the county benefitted from the La Niña rains. However, the recovery may be weaker than initially anticipated. The La Niña rains were late in some regions, such as Delmas in Mpumalanga, various regions of Limpopo, and parts of the Free State. This added strain on the grazing veld and delayed summer crop planting. Still, the overall agricultural production conditions promise to be better than in 2024, characterized by the mid-summer drought and animal disease challenge.
South Africa has also progressed notably in controlling the spread of foot-and-mouth disease and other animal diseases, such as avian influenza and African swine fever. This sets the livestock and poultry subsector in an ideal position to rebuild, provided we see a sustained recovery in the grazing veld across the country and yellow maize production, a primary feed.
Better dam levels and a stable electricity supply for irrigation will continue to benefit the horticulture subsector—fruit, vegetables, and floriculture—and set South Africa’s agriculture in an ideal position for recovery in 2025.
Reflections on 2024 performance
But let us be honest: the year we are leaving behind – 2024 – was challenging for the sector. If I can reflect on critical events and themes that dominated the South African agricultural scene, five stood out for me. Combined, they resulted in a mixed performance across the different subsectors in 2024.
First, we started the 2023-24 production season (this is the 2024 calendar year), aware that it would be a mild El Niño year, but the timing of it was uncertain at the start of the season. Consensus from various early forecasts showed that it would intensify from March onwards. Theoretically, this would not be the worst timing for farmers as the crop would have passed the pollination stages requiring moisture. As a result, we had assumed that South Africa would still achieve a decent harvest under such conditions.
Farmers planted slightly higher areas for the 2023-24 summer grains and oilseeds than the previous one. The good rains at the start of the season were a major incentive for farmers, along with relatively higher agricultural commodity prices. Indeed, for the first few months of the season, South Africa seemed to be in for a decent summer grains and oilseed harvest.
The conditions changed for the worst from February to the end of March 2024. The country did not receive any meaningful rains throughout this period, and there was also a severe heatwave. This resulted in significant crop failure and financial loss to farmers as they had planted a slightly bigger area.
By the end of the season, South Africa’s 2023-24 summer grains and oilseed harvest was down 23% from the previous season at 15,40 million tonnes. The consequence of crop failure is the tight grain supply and higher commodity prices.
Second, the animal disease continued to be a major challenge for farmers. This is understandable because we have had various cases of foot-and-mouth disease in cattle, African swine fever in pigs, and avian influenza in poultry over the past three years.
While animal disease outbreaks are not unique to South Africa and indeed common across the world, South Africa’s challenges have intensified in the recent past. In 2022, six of South Africa’s nine provinces reported foot-and-mouth disease outbreaks. This was the first time in the country’s history that the disease had spread this wide. Livestock and poultry farming account for roughly half of agriculture’s annual gross value added.
Thus, the challenging place the country found itself in prompted the government and industry stakeholders to increase their focus on strengthening farm biosecurity controls and surveillance. Other interventions that are still underway include efforts to improve South Africa’s veterinary and related support services (mainly the laboratories) that deal with vaccine production needs.
On October 25, 2024, the Department of Agriculture released even more positive news, which we believe will further support the recovery path of the industry. The Department announced that:
“the foot and mouth disease outbreak, which occurred during 2021-2022, has been successfully resolved in the North West, Free State, Gauteng, and Mpumalanga Provinces. These provinces, initially impacted by the outbreak, have now completed comprehensive testing of animals on quarantined farms. The results indicate that the foot and mouth disease virus is no longer present.”
This is admirable progress and further supports South Africa’s ambition of being a global player in red meat exports. Addressing the biosecurity challenges is essential for a successful path to the export markets.
Positive developments in 2024
Third, there were also positive developments in South Africa’s agriculture in 2024. One such positive development, which is not necessarily agriculture-specific, is the improvement in electricity supply. This positively contributed to the sector and partly to the robust horticulture production.
For example, when one considers the dependence of South Africa’s agriculture on horticulture, it is always worth highlighting that all of South Africa’s horticulture – fruits, vegetables and floriculture — depends on irrigation that needs an adequate power supply.
In crucial field crops, roughly 20% of maize, 15% of soybean, 34% of sugarcane, and nearly half of wheat are produced under irrigation.
Electricity is also heavily used in various processing activities related to red meat, poultry, piggery, wool, and dairy production. Similarly, agribusinesses and other food-producing businesses are heavy users of electricity and various downstream processing activities, such as milling, bakeries, abattoirs, wine processing, packaging, and animal vaccine production. Thus, we believe a better electricity supply enabled better operations in 2024.
Fourth, logistics infrastructure efficiency remains a primary concern for the farming sector. However, the ongoing collaboration between Transnet, private industry, and various logistical organizations helps ensure the continuous flow of products, even if there are delays in specific periods.
The gains of this collaboration are visible in the export figures. For example, South Africa’s cumulative agricultural export value for the first three quarters of 2024 is up 4% from 2023, at US$10,55 billion. This reflects an uptick in the volume of various agricultural exports and the price surge in some products.
The top exported products by value include citrus, nuts, maize, apples and pears, wine, fruit juices, sugar, dates, figs, avocados and mangos, berries, and grapes, amongst other products.
Lastly, the commitment to policy continuity after the formation of the Government of National Unity (GNU) is also a noteworthy development for South Africa’s agriculture. Ordinarily, when a new government begins its term, there would be a temptation to introduce new policies and programmes. At times, such practices are justified.
However, in South Africa’s agriculture, the Agriculture and Agro-processing Master Plan has already been formulated and embraced by business, labour, government, and other social partners. There was no need to introduce a new policy, but continuity and a sharper focus on the implementation of policy and programmes. This is precisely what the seventh administration committed to doing in agriculture. This approach saved the sector valuable time, and the efforts could now be channelled towards implementing various programmes and the sector’s growth.
Amongst other things, this is partly why the sentiment in the sector improved notably in recent months.
Looking ahead to 2025
While there were numerous other developments in the sector that we do not discuss in this note, the five points outlined above were perhaps the most notable and cross-cutting in various value chains in 2024.
As we start 2025, there is renewed optimism in the sector on the back of relatively better rainfall and improvements in the animal disease control front. This may boost the output in the sector.
From a policy perspective, this year’s focus should remain on the opening of export markets, improvement of the network industries, and improving municipality performance.
Moreover, there also needs to be a relentless focus on implementing the Agriculture and Agro-processing Master Plan as it carries relevant and necessary interventions to support the inclusive growth of South Africa’s agriculture.
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by Wandile Sihlobo | Dec 16, 2024 | General Comments
While South Africa’s maize production is down 23% from the last season because of the tough mid-summer drought to an expected harvest of 12,72 million tonnes, we continue to export maize to the Southern African region. The large opening stocks from the previous season have helped to boost our supplies, enabling the exports.
For example, in the week of December 6, South Africa exported 57k tonnes of maize. Of this volume, 57% was exported to Zimbabwe, 11% to Namibia, 10% to Eswatini, and the balance to the neighbouring African countries.
This puts South Africa’s total maize exports in the 2024-25 marketing year at 1,42 million tonnes out of the expected 1,90 million tonnes (down from 3,44 million tonnes in the 2023-24 marketing year because of the mid-summer drought).
Moreover, while South Africa will likely remain the net exporter of maize in the 2024-25 marketing year, the coastal regions will import small volumes of yellow maize for animal feed because of price advantage.
We have recently seen the imports of yellow maize from Argentina and Brazil through Cape Town. South Africa’s 2024-25 maize imports currently stand at 353k tonnes.
The 2024-25 marketing year started on May 1 2024, and will end by April 2025.
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by Wandile Sihlobo | Oct 28, 2024 | General Comments
While some regions of South Africa have already received the early 2024-25 summer rains, others haven’t received much. Farmers are understandably again worried about the prospects for the new season in some areas of the country that are still somewhat dry and with warmer temperatures.
However, I believe, supported by various forecasts from the Columbia Climate School at Columbia University and the Australian Bureau of Meteorology, that the prospects of La Niña occurrence remain pretty high this season.
On October 15, the Australian Bureau of Meteorology noted;
“The ENSO Outlook is currently at La Niña Watch, meaning there remain some signs that a La Niña may form later in 2024.”
Meanwhile, the Columbia Climate School at Columbia University sees the probability of La Niña occurrence at over 60% between October 2024 and January 2025. From February, the prospects slow to below 50%, with normal weather conditions dominating throughout the summer season.
An important point to underscore here is that “normal” weather conditions in a summer season imply regular rainfall, not drought or “El Niño”. Therefore, the normalizing weather prospects from February should not be a significant worry.
Meanwhile, the dominance of La Niña weather should ordinarily present above-normal rainfall in South Africa and the entire Southern Africa region.
Admittedly, the South African Weather Service (SAWS) has been more cautious than its peers to make a bold call on where we are regarding the weather prospects.
On October 5, in its monthly Seasonal Climate Watch, the SAWS stated
“The El Niño-Southern Oscillation (ENSO) is currently still in a Neutral state and is predicted to weaken further. Current predictions indicate the development of a La Niña state during the start of the summer season; however, there is still significant uncertainty in the predictions. It is advised to monitor the ENSO system during the start of the summer season, as it may change the rainfall outlook for the summer rainfall regions if and when the La Niña materializes.”
As I write this letter on the morning of October 28, the weather prospects for the next two weeks look favourable across South Africa. There are expectations of rainfall. If it materializes, as I hope, this may be the start of the rainy summer season. Improved rainfall prospects would be ideal for agricultural recovery across South Africa and the broader Southern Africa region.
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by Wandile Sihlobo | Oct 15, 2024 | General Comments
It’s a pretty gratifying experience to be a case study in an academic paper. You can read the paper by clicking here.
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by Wandile Sihlobo | Sep 6, 2024 | General Comments
In July, TEDx Johannesburg invited me to deliver an 11-minute TEDx Talk on South African agricultural progress and what African countries can perhaps learn from our experience.
You can watch the Talk by clicking here.
Please share it on your networks if it resonates well.
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by Wandile Sihlobo | Sep 5, 2024 | General Comments
Wandile Sihlobo named PERSON OF THE YEAR by the Animal Feed Manufacturers Association of South Africa:
“for his outstanding and noteworthy contributions to the animal feed industry.”
My comment:
In much of what we do, the drive comes from an underlying belief that the agricultural sector of South Africa remains vital to our economy and should receive all the support to continue to prosper. We also believe that many areas of this country, particularly in my home province of the Eastern Cape, and KwaZulu-Natal and Limpopo, amongst other regions, could still see much progress in agriculture. These are also areas where agriculture could help resolve poverty, low-growth challenges, and unemployment.
We also believe that the agricultural sector is vital in addressing the inequality and dualism challenges in the rural economy. Understandably, when we discuss these matters, the focus tends to be on primary agriculture – farmland. But the sector is much broader.
It ranges from input and seed providers, financiers, machinery suppliers, researchers, and manufacturers, amongst others, positively impacting South Africa’s robust food, fibre and beverages industry. I have attempted, over the past decade and so, to play my small part as a “knowledge worker” in this sector.
I have received immense support from many great South Africans throughout the years. Thus, this great honour given to me by the Animal Feed Manufacturers Association tonight speaks to the work and opportunities many people have given me over the years. I remain hopeful that I will rely on their support for years to come.
I am also grateful to many people outside agriculture and the food, fibre and beverages industry who continue to read my articles and books and support the “knowledge work” we do. I am grateful.
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by Wandile Sihlobo | Aug 30, 2024 | General Comments
The point of my previous Business Day letter concerned the need to be watchful of land use needs in specific agricultural-rich areas of South Africa. A watchful eye on these issues is vital for our long-term food security needs. South Africa is indeed a big country — about 122-million hectares. Agriculture also takes a sizeable portion of the country, about 78-million hectares.
But we must appreciate that only 17%-20% of these 78-million hectares is suitable for field crops, irrigation and horticultural production. More than 55% of farmland is ideal only for extensive grazing, and another 20% for intensive pastures and animal production.
Therefore, our farmland’s potential is limited in certain areas. We must be careful of the land use in such areas. Water is indeed also a vital part of this discussion.
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by Wandile Sihlobo | Jul 30, 2024 | General Comments
On July 19, Dr Mokgweetsi Masisi, the president of the Republic of Botswana, wrote on X that “Our ban on imported vegetables was a powerful move to boost our local farmers & economy. This initiative empowers Batswana by promoting self-sufficiency & improving livelihoods.” This quote accompanied a short video celebrating Botswana’s vegetable production improvement since the country banned the imports of vegetables from South Africa.
The ban was not a new event. Botswana and Namibia regularly close their borders for South African vegetables. However, the prolonged ban started in December 2021 and has been in place since then. The rationale for it, from both Botswana and Namibia’s side, is that it would incentivize domestic production of vegetables in these countries and lower their dependence on South Africa. Their target products include tomatoes, carrots, potatoes, cabbage, lettuce, garlic, onions, ginger and fresh herbs.
In December 2023, Botswana announced the ban extension for another two years. At the time, many in South Africa, including myself, were unhappy about this decision. The source of frustration arises from the appreciation that these countries are all part of the Southern Africa Customs Union (SACU), a bloc encouraging free trade and economic integration.
Still, the SACU agreement has a loophole allowing such restrictions. An article by researchers at South Africa’s Department of Trade and Industry citing the SACU Agreement states that “Article 18 (2) …notes that Member States have the right to impose restrictions on imports or exports for the protection of; health of humans, animals or plants, the environment, treasures of artistic, historic or archeological value, public morals, intellectual property rights, national security and exhaustible natural resources“.
Viewed in this context, one can only guess that Botswana and Namibia would argue they are boosting their domestic production of vegetables for “national security”.
This action has had a financial impact on the South African farmers who have, for many years, produced for the domestic market and the region at large.
The question that remains then is how should we respond to these events? Clearly, from the celebratory video shared by President Masisi on X, the political leadership has determined to continue with this ban.
South Africa’s response will need to be sensitive but firm. Admittedly, South Africa has significantly benefited from the African continent in its agricultural export progress. For example, in the record agricultural exports of US$13,2 billion in 2023, the African continent accounted for roughly 40%. This figure has been the same for the past decade. Importantly, in every dollar of agricultural products South Africa exports to the African continent, 90 cents is within the Southern African region. Thus, an engagement with this region about the export ban must appreciate that South Africa greatly depends on the area as a country.
The response will need not be antagonistic or arrogant but rather understand Botswana and Namibia aspirations, formulate pathways of coexistence, and better communication of policy approaches within the region. Having hostile neighbours will not benefit any of these countries’ citizens. After all, the people primarily want affordable, accessible and safe food.
Therefore, Botswana and Namibia could close the market in specific windows to boost domestic production and clearly communicate with South Africa. The South African producers would then fill specific windows when there are gaps in these markets.
For long-term planning, it would also help if these countries communicate with South Africa the agricultural products they deem of “national security” and want to boost their domestic production over the years. This would help South Africa plan better its agricultural export drive to other regions and progressively reduce its dependence on its neighbours.
Importantly, these bans on imports should also not be perpetual but should have time limits when the producers of Botswana and Namibia have restarted their industries and can compete in open markets with South Africa.
The growth or desire to expand agricultural production in these countries also has a positive spillover for South African agribusiness, which can supply farm implements and inputs to these countries. Botswana and Namibia should remain open and not hostile in this respect.
These Southern African countries should revive the regional spirit and formulate agricultural policies and programmes from that perspective. The hostility among neighbours and offensive communication is not a path to Southern Africa’s agricultural prosperity.
Yes, South Africa has dominance, but the goal should not be to overtake South Africa but to leverage its technologies and increase regional agricultural production. Such an approach is what President Masisi’s government of Botswana and Namibian authorities should follow – regional cooperation and shared prosperity in agriculture.
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