At the end of 2021, the Bureau for Economic Research (BER) in collaboration with its partners completed the annual assessment report of South Africa’s progress towards its development objectives. It was shared with Cabinet in November last year and the BER is now able to distribute the document more widely. The report demonstrates the extent of the damage caused by the Covid-19 pandemic, but some indicators also suggest reasons for optimism. The report draws from the array of developmental targets included in the National Development Plan (NDP), which align with the seven priorities of the Sixth Administration (listed by President Cyril Ramaphosa in his 2019 State of the Nation Address). It also takes more recent policy frameworks like the Economic Recovery and Reconstruction Plan (ERRP) into account, as well as Operation Vulindlela located in the Presidency and which supports the implementation of several components of the ERRP. You can access the BER assessment report here.

South Africa’s electricity sector has faced a series of challenges over the last two decades. It started with inadequate grid infrastructure to provide electricity to the majority of the South African population in the 1990s. In 1994, only 36% of total households were electrified; 50% of the urban population and 12% of the rural population. Particularly in the middle of the 2000s, the national utility, Eskom, ran into liquidity and profitability problems. It received frequent government bailouts. The 2022 national budget allocated R21.9 billion (about US$1.5 billion) to Eskom. Meanwhile, Eskom’s ageing electricity generation plants have deteriorated, resulting in frequent breakdowns. Since 2007/2008, the utility has been unable to supply electricity to meet aggregate demand. It has implemented rolling power cuts. Read more in the linked article, first published on The Conversation.

The Department of Agriculture, Land Reform and Rural Development (DALRRD) released its annual performance plan (APP) for 2022/2023 on 30 March 2022. In the foreword, Minister Thoko Didiza sets out the aims of the APP as follows: “The 2022/2023 Annual Performance Plan (APP) is, therefore, a cogent, coherent and practical implementation plan that articulates the programmes which the Department of Agriculture, Land Reform and Rural Development (DALRRD) will undertake, to chart its quest towards the improvement of rural infrastructure, to enhance competitiveness; radically address spatial patterns; and build a resilient, united and transformed sector.” She also highlights climate change, research, access to land, rural infrastructure and farmer support as important questions to be addressed. In the linked article, Agbiz head of Legal Intelligence Annelize Crosby discusses the department's annual performance plan.

In a previous Farmer's Weekly column, Agbiz CEO Theo Boshoff used the pages to share some thoughts on the State of the Nation Address. In that column, he commended the president’s pragmatic approach to supporting business and creating an enabling environment for businesses to grow the economy. He did, however, caution that policy is not only made at the top level of government and that the message was as much an appeal to the president’s colleagues in Cabinet as it was designed to instil confidence within the business sector. Roughly a month later, this theory will be put to the test. On 28 February, the Minister of Employment and Labour published the draft National Labour Migration Policy for public comment. It comes at an important time as the employment of foreigners in South Africa is close to reaching boiling point. With unemployment at record levels, many South Africans have directed their anger at foreign nationals. In the linked article, written for and first published in Farmer's Weekly, Theo Boshoff explores this subject.

One of the downsides of the heavy rains during the 2021/2022 summer season was the destruction of already poorly maintained rural roads in SA. These road networks are at the heart of the farming value chain, especially for transporting produce from farms to storage areas and markets for consumption and export. Several farmer associations have highlighted this challenge and called for local and national government intervention to improve the roads. For the Free State, which is a key region to South Africa’s grain and oilseed production, the deteriorating road infrastructure challenge was raised last weekend at the presidential imbizo in Mangaung, which was led by President Cyril Ramaphosa. While media coverage concentrated mainly on the Free State over the past few days, this is a challenge across all provinces of South Africa. Agbiz chief economist Wandile Sihlobo discussed this subject in the linked article, written for and first published in Business Day.

Since the Russia-Ukraine war started on 24 February, the global grains and oilseed supplies have remained a major focus for countries across the globe. The prices of essential commodities such as maize, wheat, palm oil, sunflowers seed, and soybeans have increased notably over the past few months. The price increases are due to ongoing worries about supply constraints and rising demand from countries that would have typically imported products from the war-ridden Black Sea region. One organisation that helps us get a sense of the size of the global grains and supplies is the United States Department of Agriculture (USDA) through its monthly report of the World Agricultural Supply and Demand Estimates. In the April 2022 update, the USDA left the 2021/22 global wheat production roughly unchanged from the previous month, at 779 million tonnes, which is marginally up from the last season. Wandile Sihlobo discusses this subject in the linked article.

Historical information indicates a noticeable decline in the share of rail transport since the deregulation of transport in 1987. This deregulation coincided with the deregulation of the single-channel marketing system for cereals and oilseeds and the introduction of GMO technology in the South African grain market in 1996. The general services that the railways delivered to the grain industry have mainly remained unchanged for more than 50 years. Agbiz Grain general manager Wessel Lemmer and Jan-Louis Spoelstra, senior project developer and Afric a representative at Stichting FlyingSwans, discuss how the market share of grain in rail transport can increase by 40% over a period of seven years after the successful application of an intermodal solution by Transnet and private sector investments in the linked article, first published in Landbouweekblad.

The 2021/22 sunflower seed production estimate increased by 5% from the previous month to 959 450 tonnes (up 42% y/y). This is also the second-largest harvest, primarily due to an expansion in area plantings and expected better yields in some regions. The improvement in the sunflower seed harvest comes at an opportune time when there are worries that there could be supply constraints in the coming months in the global market. Agbiz Grain general manager Wessel Lemmer spoke to Ryk van Niekerk of RSG Geldsake with Moneyweb, about the latest crop production estimates. Please click here to listen to the interview.

World food commodity prices made a significant leap in March to reach their highest levels ever, as the war in the Black Sea region spread shocks through markets for staple grains and vegetable oils, the Food and Agriculture Organization of the United Nations (FAO) reported. The FAO Food Price Index averaged 159.3 points in March, up 12.6 per cent from February when it had already reached its highest level since its inception in 1990. The Index tracks monthly changes in the international prices of a basket of commonly-traded food commodities. The latest level of the index was 33.6 per cent higher than in March 2021. Please click here to read more.

Rice import for MY 2022/23 is forecast to increase by 12 per cent as political campaigns and electoral activities leading up to the general election in 2023 gear up. A 4 per cent marginal increase in wheat imports is envisioned as the Russia/Ukraine crisis prolongs. High flour mill operating costs will negatively impact the price of flour. Nigerians are price-sensitive, especially regarding inelastic consumer products such as bread. Multiple stakeholder partnerships are making inroads into wheat production in Nigeria. However, these partnerships face serious yield and yield stability challenges. Meanwhile, resettlement programs for internally displaced people in the northeast are projected to positively influence an increase in rice, corn, and sorghum cultivation while farmers' access to their fields improves slowly. Read more in the linked USDA report on Nigeria's grains market.

Durban and Richards Bay port operations were expected to start slowly on Wednesday as many roads remain closed and Transnet’s staff face massive mop-up operations after their homes were damaged in the deadly KZN floods on Monday night. Transnet spokesperson Ayanda Shezi said on Tuesday afternoon that disruptive weather conditions in KwaZulu-Natal had adversely affected Transnet’s operations in the province, bringing shipping to a standstill at Durban port. “We continue to assess the extent of the damage. Heavy rains have damaged the road infrastructure leading into the Port of Durban, affecting access to the terminals. As a precautionary measure and for safety reasons, operations across the Durban Terminals had to be suspended at around 19h30 on April 11. There have been no major incidents reported at the terminals,” Shezi said. Read more in the linked article, first published on FreightNews.

Cape Five, a South African fruit exporter, decided to do some good with about 20 tonnes of pears it was unable to deliver to Russia by donating it to a charity distributing food to internal refugees in Ukraine. When the Russian invasion of Ukraine took place earlier this year, the shipment of pears was already on its way from South Africa to Russia. It became stuck in the port of Rotterdam from where it was supposed to be shipped to St Petersburg. The fruit had already been packed and labelled for the Russian market. Historically, Cape Five did a lot of business in Russia - exporting a range of products including pears, plums, apples and citrus, according to managing director Wayne Mudge. Read more in the linked article, first published on Fin24.

The Minister of Agriculture, Land Reform and Rural Development, Thoko Didiza announced that the country is currently battling 56 outbreak cases of foot-and-mouth disease (FMD), involving farms and communal areas in the Free State, KwaZulu-Natal, Limpopo, North West and Gauteng. Despite these outbreaks, the government is working hard to clear up the situation. The minister emphasised that maximum cooperation from all stakeholders in the sector is necessary to achieve control of the outbreaks. “It is important that everyone commits and respects all imposed control measures and collectively find a sustainable solution,” said Minister Didiza. The outbreaks currently troubling South Africa were caused by illegal movements of animals out of the FMD controlled zones in Limpopo. Read more in the linked DALRRD media statement.

More cool, cloudy conditions with rain over the summer rainfall region are expected during the next few days. As is typical with rainy conditions during autumn over the interior, temperatures will on average be well below normal, signalling a repeat of the heat unit deficits which characterized the mid-summer period. Furthermore, where thundershowers occur, these may again have a tendency to produce hail due to the lower atmospheric temperatures and expected instability responsible for the rainfall during the next few days. However, at this stage, it seems that a large proportion of the expected rain over the summer rainfall region will be in the form of general rain or showers. Please click here to access the latest edition of Cumulus, published by AgriSeker.

With the 2022 South African citrus export season kicking off later this month, a number of citrus growing regions across the country have provided their predicted export volumes for the upcoming season. These estimates reveal that the industry will continue to see steady growth across most citrus varietals, with an estimated 4% growth in exports across these categories.

This is good news for the South African economy in light of the local industry sustaining 120 000 jobs and bringing in R30 billion in export revenue last year alone. However, several challenges facing the sector, which include: soaring input costs including fuel and fertilizer price hikes and a major increase in freight rates; red tape hampering access to some overseas markets, as well as ongoing operational challenges at the country’s ports, continue to threaten the profitability and future sustainability of growers. Read more in the linked CGA media statement.

On Thursday 7 April, the Department of Science and Innovation (DSI) and the National Treasury (NT) hosted a workshop to provide industry and other stakeholders with feedback based on their own analysis and submissions made to date by business on the Section 11D R&D Tax Incentive. It had been announced in this year’s Budget Speech that this tax incentive would continue in its current form until December 2023, so these sessions were to discuss the changes from 2024 onwards. EY Cova has summarised the key points discussed and added some of their insights on the matters that were discussed. Please click here to peruse the report by EY Cova.

For the latest news from AFMA and the animal feed industry, please click here to access the latest AFMA newsletter - AFMA e-News.

Justin Chadwick, CEO of the Citrus Growers' Association of Southern African, shares the latest news in the citrus industry in his weekly update - From the desk of the CEO. Please click here to peruse.