The global energy crisis is fueling fierce debate around the world over which new energy projects should or shouldn’t go ahead, writes executive director of the International Energy Agency, Fatih Birol, in an article for Finance and Development. Massive investment in clean energy—including energy efficiency, renewables, electrification, and a range of clean fuels—is the best guarantee of energy security in the future and will also drive down harmful greenhouse gas emissions, he writes. “A new global energy economy is emerging, and the governments and businesses that invest early and wisely stand to reap the benefits.” Please click here to peruse.
| |
Getting back on track to net zero: three critical priorities for COP27 |
Just this year we’ve seen the increasingly devastating effects of climate change—human tragedy and economic upheaval with typhoons in Bangladesh, unprecedented floods in Pakistan, heatwaves in Europe, wildfires in North America, dry rivers in China, and droughts in Africa. This will only get worse if we fail to act. If global warming continues, scientists predict even more devasting disasters and long-term disruption to weather patterns that would destroy lives and livelihoods and upend societies. Mass migration could follow. And, failure to get emissions on the right trajectory by 2030 may lock global warming above 2 degrees Celsius and risk catastrophic tipping points—where climate change becomes self-perpetuating. Read more in the linked blog post by the International Monetary Fund.
| |
Trade must be a cornerstone of climate action, urges World Trade Report released at COP27 |
The 2022 edition of the World Trade Organizations's (WTO) World Trade Report presents new analysis and recommendations on how international trade and greater cooperation can amplify global efforts to address climate change and put the planet on a sustainable trajectory. The WTO’s flagship publication, released on 7 November at the 27th United Nations Climate Change Conference (COP27) in Sharm el-Sheikh, Egypt, also examines the consequences of climate change on trading patterns and future prosperity. Read more in the linked article by the WTO.
| |
Agbiz submission on national pricing strategy for raw water use charges |
Agbiz sent in a written submission on the 3rd of November 2022 to the Department of Water and Sanitation on the proposed revised pricing strategy for raw water use. Raw water is defined as untreated water from a water resource. It was developed in terms of the National Water Act, which empowers the Minister of Water and Sanitation, together with the Minister of Finance, to establish a pricing strategy for charges of any water use within the framework of existing relevant government policy. This is the third revision of the water price strategy. The aim of the strategy is to facilitate reform in the sector and to provide transparency and predictability to water users on how water will be priced. The intention is to provide for the full recovery of costs associated with the management, use, conservation and development of water resources and the associated administrative and institutional costs. The strategy introduces a number of new levies and charges and does away with a cap on annual increases. Agbiz head of Legal Intelligence Annelize Crosby elaborates on this subject in the linked article.
| |
Additional evidence points to a good agricultural season for SA in 2022/23 |
We continue to see convincing signals pointing to yet another favourable agricultural season for South Africa, and the broader southern Africa region, in 2022/23. In their Seasonal Climate Watch report last week, the South African Weather Service (SAWS) highlighted that "the El Niño-Southern Oscillation is currently in a La Niña state, and forecasts indicate that it will likely remain in this state during the remainder of 2022 and early 2023. A La Niña event usually has the strongest impact on rainfall during the mid-summer months. With the continued strengthening of the La Niña event, there is a high chance that it will have its usual effect on South Africa, generally for above-normal rainfall and below-normal temperatures over the summer rainfall areas." This suggests a move from the weak La Niña state we anticipated a few months ago to a more normal state in the country and the region. The likely improvement in soil moisture from now until February 2023 is a welcome development as this period covers the cultivation to the pollination stages of the crop. Agbiz chief economist Wandile Sihlobo discusses this subject in the linked article.
| |
The USDA maintained a fairly positive outlook on SA's 2022/23 maize production for both commercial and subsistence farmers |
The United States Department of Agriculture (USDA) 's Pretoria office is a key institution and it is worthwhile to keep an eye on their views. This past week they released an updated view of South Africa's 2022/23 maize production season, leaning strongly towards the views of South Africa's Crop Estimates Committee (CEC). They forecast the country's commercial maize plantings at 2,60 million hectares in the 2022/23 season, broadly aligned with the CEC, whose data points to a possible area of 2,59 million hectares. This area is slightly below the 2021/22 season of 2,62 million hectares. Still, it is well above the long-term average. Considering the USDA's yield forecast of 5,70 tonnes per hectare, South Africa's maize harvest could amount to 15,00 million tonnes in the 2022/23 season, marginally down from 15,33 million tonnes of the 2021/22 season. Still, this will be well above the annual consumption of 11,80 million tonnes and maintains South Africa as a net exporter of maize. Under such conditions, South Africa's maize exports could be above 3,00 million tonnes. Read more in the linked article by Wandile Sihlobo.
| |
Very encouraging tractor sales in SA |
Wandile Sihlobo has been closely following South Africa's monthly tractors sales data, and the results continue to surprise me. Since April 2020, the monthly sales have remained positive, registering an average of 26% y/y growth over the past 31 months. When this year started, he thought the farmers would reduce spending as fertilizer, agrochemicals and fuel prices increased aggressively along with a rise in the interest rates, all of which added financial pressure on farmers. He also assumed that the two years of solid sales – 2020 and 2021 – would mean farmers would see a limited need to replace the tractors. But the data has proven me wrong, with tractor sales seeing an average of 20% y/y growth over the past ten months of this year. The major surprise came with October 2022 tractor sales data released this week. The sales were up 48% y/y from October 2021, amounting to 1 268 units, the highest in 40 years. Read more in the linked blog post by Wandile Sihlobo.
| |
Favourable agricultural season for SA |
In this week's podcast episode, agricultural economist Wandile Sihlobo provides an update on South Africa's agricultural conditions. He highlights that signals point to another favourable agricultural season for South Africa and the broader southern Africa region in 2022/23. He cites the Seasonal Climate Watch report recently released by the South African Weather Service (SAWS), which highlighted that "the El Niño-Southern Oscillation is currently in a La Niña state, and forecasts indicate that it will likely remain in this state during the remainder of 2022 and early 2023. A La Niña event usually impacts rainfall most during the mid-summer months. With the continued strengthening of the La Niña event, there is a high chance that it will have its usual effect on South Africa, generally for above-normal rainfall and below-normal temperatures over the summer rainfall areas." Please click here to listen to the podcast.
| |
Freight rates and port congestion to continue decline into 2023 |
Prices of shipping containers have fallen by two-thirds this year after reaching figures tenfold on major trade routes during 2021, according to Investors’ Chronicle. Rates slowly began falling in the third quarter of 2022 and are expected to continue to drop, the outlet reports. The estimated cost of shipping a 40-foot container from China to the U.S. West Coast has dropped by 84% since the start of April to $2,470, according to Freightos Baltic Index. Although the rate is 86% lower year-on-year, it is still 80% higher than in October 2019, before the onset of the pandemic. Shipping container prices for routes between China and northern Europe began their decline in January, Freightos’ head of research Judah Levine said. Read more in the linked article, first published on FreshFruitPortal.com.
| |
Sri Lanka: impact assessment study of 2021 ban on conventional pesticides and fertilisers |
In April 2021, the Sri Lankan government imposed a ban on the import and use of conventional agricultural chemicals (both fertilisers & pesticides) and actively promoted the use of organic inputs in national agriculture. The move contributed to a reduction in yield and led to a surge in food prices across the country. This, compounded by other challenges such as the Covid-19 pandemic, further worsened Sri Lanka’s economy in mid-2021. Later that year (November 2021), the government partially reversed the policy and allowed for the import of chemical inputs for critical export crops . However, subsidies for chemical fertilisers were not reinstated, hence the price of food remained high (and in short supply) as the yield of major crops such as rice had not recovered. Given these dire circumstances, there was also concern that developments would lead to an increase in the usage of illegal pesticides. Please click here to peruse.
| |
Land Bank shows promising turnaround signs, but faces long road to recovery |
The state-owned company, which provides loans to established and emerging farmers, is profitable again after being on a money-losing streak for two years since 2020. The Land Bank pencilled in a profit of R1.39-billion for the year to 31 March 2022, from a loss of R711-million in 2021, and a loss of R905-million in the previous year. The Land Bank’s latest profits were largely driven by crafty but legitimate accounting practices. The Land Bank quickly wrote off soured loans of farmers to ensure that manageable and not large losses were recorded — an exercise that contributed to about 93% of its profits. Also boosting its profits were gains or income it received on its investments and the reduction of company expenses, mainly managing its loan book worth more than R20-billion internally rather than paying fees for someone else to do so. Read more in the linked article, first published on Daily Maverick.
| |
Early South African cherries have the world stage to themselves |
The local market has been filling up with South Africa’s earliest cherries which are also, fortuitously, the only cherries harvested anywhere in the world this time of the year for a period of six weeks. FreshPlaza visited ZZ2’s cherry orchards on Toscana Farm, near Lanseria, Gauteng, where harvesting started in week 39, the earliest they’ve yet managed (and next year they’d like it earlier still). The demand for these early cherries is high, and at the start of the season it’s difficult to satisfy demand from retail and from overseas buyers – a problem they are very happy to have: growing cherries in the north of South Africa has not come without paying a hefty amount of school fees, remarks Piet van Zyl, ZZ2’s general production manager. Read more in the linked article, first published on FreshPlaza.
| |
The latest edition of SmartAgri Barometer |
This latest edition of the SmartAgri Barometer, published by the Western Cape Department of Agriculture, is packed with news of diverse and exciting initiatives that all relate to tackling climate change and its impacts on people, the environment and the economy of the agricultural sector. The contributions attest to the hard work and passion for finding solutions within both the public and private sectors, including universities, NGOs and agri-businesses. Please click here to read the latest edition.
| |
Cargo movement update from BUSA |
Operationally, it appears as if the logistics and supply chain industry is back to normal for the most part. Nevertheless, port operations this week were again characterised by equipment breakdowns and shortages, adverse weather conditions, backlogs, and congestion. Our national ports, unfortunately, experienced another challenging week as adverse weather conditions ensured operational delays throughout the week. For example, in Durban, 14 vessels were delayed during the early stages of the week due to strong winds, while terminals in both Cape Town and the Eastern Cape were windbound on several occasions throughout the week. In addition, several equipment breakdowns led to further delays throughout the week – inhibiting our road to recovery. Global shipping had a bumper year in 2021 when demand for international goods rebounded from the early days of the pandemic, and global trade hit a record $28,5 trillion, a ↑25% jump from 2020 levels and ↑19% more than before the pandemic. But demand for global trade is now entering a period of decline that could last well into next year, as global container throughput has started to contract in line with global recessionary trends. Please click here to access the latest BUSA Covid-19 Cargo Movement Update.
| |
KZN PPO rekindle connections |
On 4 November, the Kwa-Zulu Natal (KZN) Pig Producers Organisation held its first annual pig day after Covid-19. Farmers and various input suppliers were excited about the recent increase in pig prices but faced hard truths head-on. Dr Peter Evans gave a comparative global perspective highlighting the pressures farmers face. Conversations centred around improving the cost of production and adopting volumes-based production approaches. Wandile Shilobo, chief economist at Agbiz, gave an overview of the current macro-challenges the agricultural industry faces. This includes infrastructural constraints, state administration inefficiencies, pollitical uncertainty and biosecurity risks. He explained that there are ongoing discussions between the agricultural industry and the Department of Agriculture, Land Reform and Rural Development to manage these challenges. Read more in the linked SAPPO news article.
| |
The Citrus Growers' Association of Southern Africa, shares the latest news in the citrus industry in its weekly update - From the desk of the CEO. Please click here to peruse. | |
African Agri Investment Indaba
14-16 November 2022 | CTICC | Cape Town
More information
Croplife Hybrid Conference
Theme: "Impact of the EU Green Deal on Agriculture"
24 November 2022 | Lord Charles Hotel | Somerset West
More information
Register
Export Forum
Theme: "Manufacturing our future"
28-29 November 2022 | CSIR | Pretoria
More information
Programme
SAFA Online Seminar
Theme: Competitiveness through sustainability
2 December 2022 | 9:00 | Online seminar
More information: safa@safeedlot.co.za
Africa Annual Summit on: AgriTech and Climate Smart Agriculture, 2022
7-8 December 2022 | Irene Farm |Centurion
More information
Nedbank Vinpro Information Day
19 January 2023 | Cape Town International Convention Centre | Cape Town
More information
Xth International Symposium on Irrigation of Horticultural Crops
29 January 2023-2 February 2023 | Stellenbosch
More information
Africa Agri Tech Conference and Exhibition
14-16 March 2023 | Sun Arena | Menlyn Maine | Pretoria
More information
| |
- Agbiz is the only organisation that serves the broader and common over-arching business interests of agribusinesses in South Africa.
- Agbiz addresses the legislative and policy environment on the many fronts that it impacts on the agribusiness environment.
- Agbiz facilitates considerable top-level networking opportunities so that South African agribusinesses can play an active and creative role within the local and international organised business environment.
- Agbiz research provides sector-specific information for informed decision-making.
- Agbiz newsletter publishes members' press releases and member product announcements.
| |
THIRD-PARTY WEBSITE LINKS TO THIS NEWSLETTER | |
The Agbiz Newsletter may contain a few links to websites that belong to third parties unrelated to us. By making these links available, we are not endorsing third-party websites, their content, products, services or their events. Agbiz seeks to protect the integrity of its newsletter and links used in it, and therefore welcomes any feedback. | | | | | |