Man-made crises hobble South Africa’s farming sector


South Africa maize silos

Africa Editor
JOHANNESBURG, (CAJ News) – SOUTH Africa’s agricultural sector ought to be celebrating its golden age but it cannot.

Rampant corruption, incessant load shedding, rising crime and poor infrastructure are taking the glitter off bumper harvests.

Rural towns are the hardest hit by these manmade disasters.

Had it not been for these crises, South Africa’s agriculture would have had greater consecutive seasons since 2019/20 as the sector’s gross value added grew by 14,9 percent in 2020, then 8,8 percent in 2021 and modestly by 0,3 percent in 2022, primarily supported by favourable weather conditions.

“These are not new issues,” economist Wandile Sihlobo, said of the problems.

“They have been flagged before. But they have worsened,” he added.

“They are a challenge for large commercial farmers as well as smaller farming enterprises. The emerging or new entrant black farmers, with limited financial resources, face it more acutely,” Sihlobo said.

Meanwhile, the current season is also likely to deliver solid growth for the sector, with variation across sub-sectors.

Export performance is likely to be robust, especially with a weaker rand exchange rate, which makes South African products more competitively-priced in the global market.

Global prospects are positive but local issues linger.

Sihlobo, chief economist at the Agricultural Business Chamber (Agbiz), said these highlight the effects of weak governance across all spheres of government in South Africa, led by the under-fire African National Congress (ANC) of President Cyril Ramaphosa.

“It is serious for all sectors, but particularly so for agriculture, which depends on the proper functioning of essentials such as roads, water and power,” he said.

Sihlobo lamented the poor roads in his home province in the Eastern Cape.

There, dairy farmers in the Ncorha area struggled to receive farm supplements, feeds and diesel because of the poor state of roads. The farmers could not deliver their produce to the market.

The Eastern Cape accounts for nearly a third of South Africa’s dairy production.

Roads across the rural towns of the Free State, Limpopo, North West and KwaZulu-Natal, all of which are major agricultural provinces, are also in a deplorable state.

Sihlobo noted more than two-thirds of South Africa’s agricultural produce is now transported by roads, as rail transport has faced challenges over the years.

Challenges include looting and vandalism.

It has emerged the poor road network has forced some farmers to pay for road maintenance. This is in addition to some farmers paying more for generators and fuel in the wake of power cuts.

So, they have not been able to reap the full benefit of higher agricultural output as they incur additional operating costs.

Farmers also step in corrupt municipalities and plunder money meant for infrastructure.

“There is little transparency and accountability on how these municipalities use their funds,” Auditor General, Tsakani Maluleke, said.

Last week, she revealed how municipalities disclosed a total of R30,34 billion (US$1,57 billion or ¥11,17 billion) in irregular expenditure in 2021-22, significantly more than the R22,40 billion in the previous year.

Agribusinesses in some of the beleaguered towns have had to step in and maintain water infrastructure.

Crime is also a concern.

Sihlobo noted how commercial farming businesses have had to tighten security over the years, at their own cost because of lawlessness that authorities are battling to contain.

Farmers without a strong financial position to invest in security and technical solutions lose more as harvest and livestock thieves reap where they did not sow, literally.

Agriculture, alongside fishing and forestry, are the main contributors to South Africa’s gross domestic product (GDP), contributing 19,2 percent in the last quarter of 2022.

– CAJ News




















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