Agricultural Market Viewpoint with Wandile Sihlobo

South Africa's agricultural exports amounted to US$3.9 billion in the third quarter of this year, up by 4% y/y (according to data from Trade Map). This quarter, the products that dominated the export list were citrus, maize, apples and pears, nuts, wine, soybeans, sugar, and fruit juices. This solid export activity was both a function of improvement in volumes and prices, specifically of fruits. T...

The data released this past week by the Crop Estimates Committee continue to paint a reasonably positive picture of South Africa's winter crop harvest, albeit with minor downward monthly revisions of the crop size. The primary issue on farmers' minds is perhaps not crop size but the deterioration in quality following heavy floods in the Western Cape in September. The Western Cape is a significant...

Food inflation has been topical over the past few months, and South Africa saw double-digit levels from mid-2022 to mid-2023. This was not unique to South Africa but a global phenomenon underpinned by various factors, including drought in South America, China's strong demand for grains and oilseed, higher energy prices, and the Russia-Ukraine war, amongst other factors. Positively, from March 2023...

The solid production conditions in South Africa's agricultural sector continue to be reflected in the employment data. For example, the data released today by Statistics South Africa showed that in the third quarter of 2023, about 956 000 people were employed in primary agriculture, up 10% year-on-year (and 7% quarter-on-quarter). This is well above the long-term agricultural employment of 793 000...

One aspect that remains a major challenge for the domestic animal farming sector and has been raised by our members in various engagements for some time is the weaknesses in South Africa's biosecurity system. Admittedly, biosecurity breaches are not uniquely South African and have become a significant challenge globally. We frequently hear of Foot and Mouth Disease (FMD) in cattle, African Swine F...

Although El Niño is on our doorstep, we have generally held an optimistic view about South Africa's 2023/24 summer grains and oilseed production season. The excellent soil moisture from the past rainy seasons and prospects of rainfall throughout 2023 have convinced us that there may still be decent summer grain and oilseed plantings. The South African Weather Service expects the El Niño induced dr...

October 16th marks World Food Day, a celebration of the founding of the United Nations Food and Agriculture Organization in 1945. This day is also an opportunity for countries to reflect on their food security conditions and efforts to boost agricultural production. Thus, today, we revisit an aspect we discussed a year ago: food security conditions in South Africa. One of the measures some researc...

The topical issue in South Africa's agriculture currently is the avian influenza spreading across South Africa. The most dominant strains are the highly pathogenic H5 and H7. The most affected provinces so far are Gauteng, Mpumalanga, Free State, Limpopo and North West. We understand that over a hundred mostly commercial facilities have reported avian influenza cases so far. Notably, there are rep...

The Western Cape, which accounts for over two-thirds of South Africa's winter crops and a large share of wine grapes and various horticulture products, faced another heavy and destructive flood this past week. The rainfall peak was mainly the Bredasdorp in the Southern Overberg region. Significant damages to farm infrastructure, electricity supply and road networks are reported in various small fa...

This is a quick comment on the current avian flu in South Africa. The segment is mainly to update the listeners of the podcast on this topical issue Wandile Sihlobo website

Last week, South Africa's Crop Estimates Committee (CEC) released its 2022/23 8th summer crop production forecasts. In these production estimates, there were no new surprises or significant adjustments to the existing forecasts. For example, if we can highlight maize, the 2022/23 commercial harvest is 16,4 million tonnes, roughly unchanged from August figures (-0,09% m/m). This crop is 6% more tha...

We are three weeks into the start of South Africa's 2023/24 summer crop production season. The uncertainty regarding the intensity of the El Niño weather event as well as the, possible higher temperatures and lower-than-normal rainfall that this could bring is still a concern. However, the latest message from the South African Weather Service (SAWS) through their Seasonal Climate Watch on 28 Augus...

The South African government voiced concerns about the higher food prices and instructed the cabinet's economic cluster to implement a food security plan to cushion consumers. We have yet to see the government's strategy and approach. But it is worth highlighting that South Africa's consumer food price inflation has started to decelerate from the high levels of 14,4% we saw in March 2023. In July...

South Africa's agricultural exports amounted to US$3.4 billion in the second quarter of this year, up by 0,1% y/y. Despite challenges in key export markets such as the EU in the case of citrus, the products that dominated the export list this quarter were citrus, maize, apples and pears, wine, sugar, soybeans, wool, avocados, pineapples, fruit juices, nuts, and grapes. Importantly, this good expor...

The Kingdom of Saudi Arabia was mentioned as one of the countries that are set to join the BRICS in January 2024. This is a major development, and one that offers another avenue for diversifying the geographic destinations of South Africa’s agricultural exports. There is no doubt that South Africa’s agriculture stands to benefit enormously from close cooperation with Saudi Arabia. As chair of the...

One positive development in South Africa's agriculture this past week was the re-opening of the Chinese beef market and the firm establishment of beef access to the Kingdom of Saudi Arabia. The Kingdom of Saudi Arabia has not featured prominently in South Africa's beef export markets in the past, with only small volumes last exported in the early 2000s. The renewed access to this market is critica...

South Africa's agricultural export earnings will likely soften this year from the 2022 record. The lower commodity prices, ongoing restrictions to exports of some livestock products because of the foot-and-mouth disease and the stringent regulations of the citrus black spot disease in the EU market are among some of the factors likely to result in lower export earnings. While SA's agricultural exp...

We spent most of July on the road, engaging with Agbiz members and sector role-players in various regions of the country. The feedback about the near-term outlook was reasonably positive in all our engagements, with many attributing their optimism to the favourable 2022/23 summer crop and 2023/24 winter crop seasons. The feedback from the horticulture and wine industries also remained encouraging...

As South Africa's 2022/23 summer cop season draws to a close, the focus is shifting towards the 2023/24 production season, which commences in October. As we stated in our previous notes, the preliminary insights suggest that an El Niño could bring below-normal rainfall, but South Africa could still have a decent season. The improved soil moisture following four consecutive seasons of rain will hel...

A lot has happened in the agricultural markets over the past few weeks. First, Russia decided not to renew the Black Sea Grain Deal, which is essential to facilitating exports out of Ukraine and has contributed to a decline in global grain prices. Second, India has banned the exports of non-basmati white and broken rice on fears of inflation. Both these events have been quite disruptive to the gra...

This past week was dominated by global agricultural events. First, grain exports, specifically from Ukraine, were disrupted when Russia invaded the country in February 2022. But the rising concerns about global food security resulted in the United Nations and Turkey brokering a deal in July 2022 between Russia and Ukraine to allow a safe movement of grain from Ukraine to the world market while the...

The livestock and poultry industry has had a difficult last few years. Various external shocks including animal diseases and rising input costs – yellow maize and soybean prices – made for a challenging operating environment for many farmers and agribusinesses. While the spread of diseases may be slowing, and organized agriculture and government continued to collaborate to address biosecurity risk...

South Africa's agricultural sector had a rough start to the year regarding production and exports. The excessive rains brought production challenges that delayed the summer crop planting activity by roughly a month but later improved. Regarding exports, the slowing agricultural commodity prices reduced profitability from the levels farmers enjoyed a year ago, specifically grains and oilseeds. More...

With summer crop harvest underway across South Africa, the recent production estimates are more reliable and reflect the large yields farmers continue to reap. Hence, we were not surprised when South Africa's Crop Estimates Committee lifted the country's 2022/23 commercial maize production estimate by 1% from last month to 16,35 million tonnes. This crop is 6% more than the 2021/22 season and the...

From a maize supply perspective, South Africa is in a relatively strong position. According to recent estimates by the Crop Estimates Committee, the country's 2022/23 commercial maize production could reach 16,1 million tonnes, up 5% year-on-year and the third largest on record. Given South Africa's annual maize needs are roughly 12 million tonnes; the country could have over 3 million tonnes for...