The interlinked problems of poverty, unemployment and weak economic activity continue to plague rural towns and communities in SA. However, the two industries that could help ease some of these challenges — agriculture and tourism — face various constraints that limit their growth potential. Beyond the big topics of ambiguous land reform and international trade in the case of agriculture, the everyday challenge for farmers, agribusinesses and tourism entities is the dire state of local road networks, deteriorating water infrastructure and high crime levels. Agbiz chief economist Wandile Sihlobo discusses this subject in the linked article, written for and first published in Business Day.

The North-West University Business School 4Q 2022 PUI eased to 53.2 from 59.6 in 3Q 2022 (baseline 50). Although still in negative territory, the positive factors in the past three months outweighed the negative ones to significantly reduce the 4Q 2022 PUI. The record elevation of the PUI in recent years owed much to a formidable combination of negative global and domestic factors that persisted for a while. But the calibration of the 4Q 2022 PUI suggests that some of these negative factors have either ameliorated or are now being largely ‘priced in’ by the markets. Please click here to peruse.

We note the ANC January 8th statement and appreciate that this reflects priority issues for the majority party as it goes into the new year. However, we will be concentrating substantively on the president’s state of the nation address (SONA) on the 9th of February 2023, which should reflect on the priorities for government, with the president addressing the nation as president of the country. The theme of the ANC statement is a “year of decisive action to advance people’s interest.” We remain convinced the only way to advance people’s interest is through the attraction of substantial investment, both local and global, and government taking the necessary decisions, and implementing them, to create a sustainable environment for inclusive growth. We urge the president to be absolutely clear in the SONA on this and to exhort government, under his leadership, to see this as a critical priority! We also urge the president to ensure his government implements critical de decisions and holds those failing to implement them to account. This is, in our view, “decisive action.” Please click here to access the full BUSA media statement.

South Africa's agriculture will likely have a downbeat start into 2023. The gross agricultural value added for 2022, which will be released in March, will probably show a mild contraction. This would be a notable shift from two consecutive years of solid growth, with the sector expanding by 14,9% y/y in 2020 and 8,8% y/y in 2021. Mild declines in critical crop harvests such as maize, production challenges in the sugar industry, trade friction in fruits, vegetables, beef and wool, and widespread foot-and-mouth disease weighed on the sector's performance this year. In a slightly more technical sense, the strong growth in the last two years has created an exceptionally high base, setting the ground for some pullback. This year some of the challenges that dominated the agricultural calendar will again surface. In the linked article, Wandile Sihlobo shares what he believes will be part of discussions, especially in the first half of this year.

"My annual December drive from Pretoria to the Wild Coast in the Eastern Cape affords me an opportunity to assess South Africa’s agricultural conditions after the first few months of the summer season. Whether one enjoys this trip largely depends on weather conditions. In drought seasons like in 2015, this could be a depressing drive, traversing the dry grains and oilseed fields. Conversely, this could be an uplifting drive in rainy seasons, with green and lush fields visible from the highway. Thank goodness, my drive this year was to the latter, refreshing as in December 2021, another La Niña induced rainy summer season. We are again in another La Niña rainy season. The heavy showers since the start of October have helped improve soil moisture across the country and assisted farmers in boosting plantings. But not all areas have fully completed the areas they intended to plant. Some fields in Free State, Eastern Cape and North West are yet to complete grains and oilseed plantings. There will be roughly a month delay in plantings." Read more in the linked blog post by Wandile Sihlobo.

"I have previously emphasised the importance of accurate data in the South African agricultural sector to help inform decisions – from an investment, marketing, or policy perspective. In this blog post, I will focus on the less discussed but essential data to observe: sheep slaughtering in South Africa. My colleague at Stellenbosch University’s Department of Agricultural Economics, Prof. Johann Kirsten, recently completed an exciting analysis of the data linked to the statutory levy in the red meat industry. An important point to remember before I proceed is that every animal that gets slaughtered carries a levy amount paid to the red meat industry organisations. So, Prof. Kirsten’s analyses focused on the sheep meat industry, and we can extract from his work the following facts on this vital industry." Please click here to access the blog post by Wandile Sihlobo.

South Africa’s agricultural trade data paint an encouraging picture, though the sector continues to struggle with poor roads and inefficiencies in rail and ports. In the third quarter of this year, the value of the country’s agricultural exports — food, fibre and beverages — amounted to $3,7bn, up 10% year on year. The main factors underpinning this are sizeable agricultural output in the 2021/22 production season and higher commodity prices. Citrus, maize, nuts, wine, apples, pears, sugar, fruit juices, berries, soybeans and wool were among the most critical products exported in the third quarter. Wandile Sihlobo discusses the latest data in the linked blog post.

Food inflation in South Africa is currently above 12%. That is significantly above the 7.4% headline inflation number. Why are food prices high and can consumers expect a reprieve in this year? Chief economist at Agbiz Wandile Sihlobo spoke to eNCA about what South African consumers can expect in 2023. Please click here to watch the interview.

The Purdue University in Indiana delivers an annual report in February on the number of dust explosions in grain silos in America in the previous year. In 2021 there were seven incidents compared to eight incidents in 2020. It resulted in one death and five injuries. There are several types of dust explosions. Most occur in the wood procession industry (34%), followed by explosions where grain and oilseeds are handled, stored and processed (24%). Agbiz Grain general manager Wessel Lemmer discusses this topic in the linked article, written for and first published in Landbouweekblad.

On 6 December 2022, the Department of Agriculture, Land Reform and Rural Development explained in a letter to stakeholders in the cereal, oilseeds, and grain products sector how it will go about applying inspection services by August 2023. The notice was received with mixed feelings. In this stage, the date is a target and not necessarily a date for applying inspection services. Agbiz Grain general manager Wessel Lemmer discusses this topic in the linked article, written for and first published in Landbouweekblad.

The FAO Food Price Index* (FFPI) averaged 132.4 points in December 2022, down 2.6 points (1.9 percent) from November, marking the ninth consecutive monthly decline and standing 1.3 points (1.0 percent) below its value a year ago. The decline in the index in December was driven by a steep drop in the international prices of vegetable oils, together with some declines in cereal and meat prices, but partially counterbalanced by moderate increases in those of sugar and dairy. For 2022 as a whole, however, the FFPI averaged 143.7 points, up from 2021 by as much as 18 points, or 14.3 percent. Please click here to peruse.

As the new Brics chair, South Africa has an ideal opportunity to influence the agenda and advance the agricultural trade interests of the country, believes Agbiz chief economist Wandile Sihlobo. With South Africa now in the driving seat of the Brics grouping of nations, the nation’s farming hotshots are hopeful that this also presents an opportunity to advance agricultural trade. This, after President Cyril Ramaphosa yesterday said that South Africa will use its role as the 2023 chair to advance the interest of Africa as a whole. Other African nations will be also invited to the Brics summit in South Africa later this year. Read more in the linked article, first published on Food for Mzansi.

A group of Northern Cape irrigation farmers released a video directly addressed to Eskom’s leaders to tell them that, due to irregular load-shedding, crops under irrigation are at risk in one of the country’s poorest provinces, and probably also in other parts of South Africa. This group of farmers are requesting that Eskom, relevant government departments and farmers work together to implement load-shedding with much more insight to save irrigation harvests. They understand that Eskom is facing specific challenges, but they also believe that they can make practical suggestions on how to successfully navigate the crisis – together. Please click here to peruse.

Social instability is emerging as a critical risk undermining the sustainability of rural enterprises. This manifests in destructive protest action, national shutdowns and vandalism in rural areas and disruption of the logistics networks which our businesses rely on. As part of its rural rejuvenation initiative, Agbiz is hosting a workshop on 20 January 2023 at the Grain Auditorium in Pretoria, focused on solutions to buffer against these risks. The programme will include industry leaders sharing their experience on building networks in the communities where they operate and the possible steps that can be taken to mitigate risks. Please click here to register for the event.

Eighteen new generation farmers received their national certificates in mixed farming practices at the Kaap Agri Academy graduation ceremony held in Porterville on Friday 2 December.

The graduates are part of the Academy’s Farmer Development Programme, which offers courses accredited by AgriSETA in terms of the National Qualifications Framework (NQF). All 18 graduates received their NQF2 qualification in Mixed Farming Practice. The Farmer Development Programme is designed to provide new generation farmers and students with theoretical, practical, and managerial knowledge to pursue a career in agriculture. Read more in the linked Kaap Agri statement.

Good news was received that the Competition Tribunal approved the merger between VKB and GWK on 21 December 2022 shortly after receiving a recommendation for approval from the Competition Commission. This follows the July 2020 announcement that discussions commenced between the two companies. GWK’s shareholders voted in favour of the merger on 11 August 2022 after approval of the transaction by VKB’s board of directors within their mandate earlier in 2022. The conception and design of the transaction was led by representatives of GWK and VKB, in collaboration with an external, independent corporate finance advisor, Pallidus, in order to negotiate an agreement that ensures the protection and long-term benefit of both groups. Please click here to access the joint VKB and GWK statement.

In the latest edition of Keeping it Fresh, the Fresh Produce Exporter's Forum (FPEF)'s newsletter, you will get a summary of the most pertinent information as well as reminders of important upcoming events. Please click here to peruse.

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.