Wandile Sihlobo: There's confidence in SA agriculture - from farmers themselves

Wandile Sihlobo
Wandile Sihlobo

If I were to be asked to name one word I used more extensively than any other this week, it would be confidence.

I participated at the Citrus Growers’ Association Summit held in Port Elizabeth on 13 March, and the South African Feedlot Association’s Cattlemen’s Annual Conference in Bloemfontein on 14 March.

In both sessions, my message was centred on the role of confidence in boosting South Africa’s agricultural economic growth, and therefore yield the jobs that this country so badly needs. (You can download the presentation slides here.)

Aside from my presentation, both these events offered me an opportunity to interact with growers and ranchers at all levels – developing farmers and commercial farmers. While these industries are different, the aspirations and concerns are somewhat the same.

In terms of aspirations, developing farmers who attended the conferences already have products in formal or commercial markets, particularly the citrus growers. All this has been made possible by help from both the private sector and government – capital and passing the ‘know how. And they aspire to grow their enterprises in scale, as a way to remain competitive in the long run.

Familiar issues

Familiar issues are holding them back – lack of title deeds, which then limits access to finance, the water rights issues, and infrastructure constraints, amongst others.

A heart-warming development in the citrus industry is the ascendance of women growers. In a panel discussion I chaired, we had Ms Louisa Maloka-Mogotsi, a trained social worker turned farmer.  

Ms Maloka-Mogotsi aims to grow her enterprise in the coming years, provided the aforementioned challenges are addressed.

Trade

The issue of trade was also raised a number of times in the discussions. The South African citrus industry has well-established markets in the EU region, and some countries in the African continent, amongst other regions.

But the rising production – which will no doubt continue if developing farmers’ operations take off and they manage to bring some of the currently underutilised lands into production in the coming years – has placed an increased focus on this matter.

China (and the Asia region at large), and the Middle-East remain attractive markets for South African agriculture due to rising incomes and population. To be clear, this is the case for the beef industry as well, albeit that the recent outbreak of the foot-and-mouth disease poses challenges.

Worries

In terms of key concerns, climate change, and a lack of direction on land reform are some of the issues that farmers are watching closely.

From a climate change side, the discussion has slightly progressed towards questions of whether there are any technological solutions out there that can assist the industry to adapt to the changing climate, over and above the required adjustment in farming practices.

On the question of land reform, there is a general acknowledgement that land reform has to happen in South Africa.

My sense is that farmers are jittery, mainly about the process of effecting land reform, not the subject itself. To this end, the ongoing planning process currently underway – at Parliamentary level, and at an advisory level to the President – will perhaps offer some guidelines over the coming weeks.

Overall, although my presentation demonstrated subdued confidence in the South African agricultural sector, drawing from historical data, the one-on-one conversations with farmers show that there is an appreciation of policy dialogue, and hope that the sector will emerge strongly in the coming years.

The Agricultural Business Chamber will release the results of 2019’s first quarter Agribusiness Confidence results on Monday. This will offer a clearer view of the sentiment in this sector. What I have explained here are conversations with a few farmers, not a representative sample of the country.

To end on a positive note, the citrus industry informed us yesterday that their 2019 exports could reach a record 137 million boxes of citrus fruit to more than 100 countries. If the policy environment is conducive, some of the revenues could be reinvested in the farms for future long-term growth, and sustainability.

Wandile Sihlobo is chief economist of the Agricultural Business Chamber of South Africa (Agbiz). Follow him on Twitter: @WandileSihlobo

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