12
e-Newsletter
31/2020
21 August 2020
Agbiz welcomes move to alert level 2, including the lifting of the ban on alcohol and tobacco sales 
 
The Agricultural Business Chamber (Agbiz) strongly welcomes the announcement by President Cyril Ramaphosa over the weekend to move from alert level 3 to alert level 2 and to open up the economy as far as possible, within obvious measures to curb the spread of Covid-19. "The lifting of the ban on alcohol and tobacco sales is very good news and we commend the government for this necessary and well-considered decision," says Agbiz CEO Dr John Purchase. "We trust that the industries in the liquor and tobacco value chains can now begin to recover. However, government will need to take the necessary steps to stop the illicit trade that has flourished in the prohibition period. Since the introduction of sales restrictions in March, many stakeholders in these industries have recorded serious economic and livelihood losses. South Africa's agriculture value chain has a central role to play in driving economic growth and social stability in the country, including in these specific industries." Read more in the linked media statement.
Agriculture shines in a pandemic-stricken economy 
 
The high-frequency data across the major economies and the developing world underscore the view that the world will experience one of the sharpest declines in economic activity in history. Covid-19 has caused widespread turmoil and volatility since the start of 2020, and the measures implemented to contain it have sent shockwaves throughout the global economy. The latest projections from the International Monetary Fund (IMF) and the Organisation for Economic Cooperation and Development (OECD) are bleak, with the global economy projected to contract by 5-6%, with a more gradual recovery than initially suggested. For South Africa, the Bureau for Economic Research (BER) expects a contraction in GDP of 9.5% in 2020, with a modest rebound of just 3.1% in 2021. Structural challenges pre-Covid-19 suggest the recovery will be prolonged, with real GDP only projected to exceed 2019 levels by 2026. Limited consumer spending power, rising debt and lagging unemployment are some of the challenges to overcome what will most likely cause a slowdown and reversal in some of the progress made in class mobility over the last two decades. In the linked article, written for and first published on Daily Maverick, Prof. Ferdi Meyer and Dr Tracy Davids, state that amid all of these negative impacts and projections, the South African agricultural sector has emerged as a shining light, although its small share contribution to the overall economy will mean that it won't be able to change the bleak outlook.
A timeline of the state's efforts to fight corruption
 
In a recently published political research note, independent political and economic analyst JP Landman states that there is palpable anger in the country about corruption. "The anger is largely focused on what the ANC is doing and failing to do about the scourge. If we separate party and state, it is useful to look at the scoreboard of what the state has achieved so far in fighting corruption."  Please click here to peruse.
High-level Nedlac working group on economic recovery begins meeting
 
The first formal meeting of the small multi-stakeholder working group set up to finalise South Africa's Covid-19 economic recovery plan is expected to take place next week, with a preliminary planning meeting having taken place on Thursday afternoon. The working group includes representatives of labour, business, community and government and its creation was agreed during the August 13 meeting between President Cyril Ramaphosa and the social partners represented at the National Economic Development and Labour Council (Nedlac). It has been given about a month to complete its work. Read more in the linked article, written for and first published on Engineering News.
POLICY AND LEGISLATION
Agbiz presents to the Portfolio Committee on the ULTRA Bill

Agbiz was invited by the Portfolio Committee on Agriculture, Land Reform and Rural Development to present its views on the Upgrading of Land Tenure Rights Amendment (ULTRA) Bill at a committee meeting held on 18 August 2020. The Bill seeks to remedy a constitutional defect in the Act which discriminates against women when converting old, apartheid-era rights in various registers (which could only be recorded in a man's name at the time) into full ownership in peri-urban areas formerly segregated during apartheid. Whilst there was broad support for the amendments by all presenters on the day, many were of the opinion that the Bill did not go far enough as pre-constitutional references to 'tribal land' still poses a threat to the rights of communities under the Act. Agbiz led the discussions at Nedlac where a number of constructive changes were made to the Bill. The presentation delivered to the Portfolio Committee is linked. 
AGRIBUSINESS RESEARCH
La Niña and price surprises will make farmer fingers itch for the soil

South Africa is about a month-and-a-half from the start of the 2020/2021 summer crop planting season. Commodity prices and the weather outlook are the most important indicators of farmers' potential planting decisions for the season ahead.
Agbiz chief economist Wandile Sihlobo recently discussed the latter in an article, highlighting that the forecast La Niña weather event this summer signals higher rainfall, which is conducive for crops. "The former is the one I find most interesting and is also supportive of a potential increase in plantings in the 2020/2021 season. I am surprised that domestic grain and oilseed prices have remained firm for so long given the underlying supply and demand conditions." In the week of August 13, yellow and white maize spot prices were up 5.3% and 0.2% year on year respectively, trading at R2 895 and R2 880 per tonne.  Read more in Wandile Sihlobo's article, written for and first published in Business Day
LABOUR
Shutdown looms for truck drivers
 
Throughout the course of the week, Agbiz was notified of a call by the "All Truck Drivers Forum and Allied South Africa" grouping to embark on a national shutdown from 23 August to 28 August 2020. The grouping intends to arrange the demonstration to protest the employment of foreign nationals as truck drivers in South Africa. Agbiz has communicated with its partners at Nedlac who have confirmed that no section 77 notice has been received by Nedlac, which means that it may not be a protected strike. An article by Jahni de Villiers of Labour Amplified is linked which explains the rights and obligations of employers in the event of an unprotected strike. Perhaps most important for agribusinesses is to note that there may be disruptions in road logistics next week unless the dispute is resolved.  
OTHER NEWS
Covid-19: Cargo movement update
 
Business Unity SA (BUSA) has published an update on cargo movement  - the fourth of its kind. It contains a consolidated overview of the flow of air, sea and road freight to and from South Africa over the course of the last week, as well as an overview of the current situation with trade regionally and internationally. In terms of Covid-19 infections, South Africa remains in fifth position globally with more than 572 000 total cases recorded at the time of writing. Fortunately, the infection rate has decreased over the course of the last two weeks or so. Nevertheless, the continued drive to ameliorate the health consequences of Covid-19 continue to take precedence in the country, further standing in the way of attempts made by the private sector to revive economy activity and growth. Many businesses throughout the country are currently on their knees, which does not bode well for the preservation of livelihoods damaged by Covid-19.
Chinese vaccine for African swine fever advances to next trial phase
 
A Chinese vaccine against African swine fever will advance to the next phase of clinical and production trials after a series of positive tests, the Ministry of Agriculture and Rural Affairs said on Tuesday. The progress means China is a step closer to prevention of a disease that has spread across the country, wiping out more than a third of its hog production. The vaccine was developed by the Harbin Veterinary Research Institute, part of the Chinese Academy of Agricultural Sciences (CAAS). The linked article, first published in the South China Morning Post, elaborates on the latest developments.
Grape harvest cut as pandemic crushes bubbly sales 

France's champagne makers reached a last-minute agreement on Tuesday to cut the volume of grapes they will harvest this year by more than a fifth as they try to cope with a collapse in sales caused by the coronavirus crisis. 
With harvesting off to an early start after warm, dry weather this year, producers struck a deal to reduce grape volumes to 8 000 kg per hectare, down nearly 22% from 10 200 kg in 2019, the CIVC industry body said. Producers have been locked in talks for weeks over harvest output. Leading champagne houses have pushed for a steep fall to shore up prices, while some growers wanted a smaller reduction to take advantage of a promising 2020 crop. Read more in the linked Reuters article.
A bitter wind at a shaky time, and Iowa is left reeling
 
As the winds howled outside, gusting at over 100 miles per hour, families hid in their basements and wondered what would await them when they emerged. Many across the Corn Belt of central Iowa were stunned by what they saw: millions of acres of corn and soybean fields left toppled, tangled and torn apart; roofs torn off grain bins; buildings leveled - another daunting setback in a farming community that has had too many of them. The damage this time was from a derecho, a line of intense and fast-moving windstorms marauding across the prairie. But it adds more pain to a series of economic challenges compounded this year by the effects of the coronavirus. Read more in the linked article, first published in The New York Times.
Food prices in Nigeria have shot through the roof. But is the pandemic to blame?
 
Covid-19 has had a dire effect on global economies. Rising infection rates have led to social distancing directives, persistent lockdowns, the closing of businesses, travel restraints, salary cuts, and a looming high unemployment situation. Economic activity has shrunk dramatically, and with it the food supply value chain globally. The story for Nigeria has been no different. The country has instituted a range of measures to try to curb the pandemic. These have included waves of lockdowns in major cities, border closures and people's movement being restricted. These measures have affected all sectors of the economy. But food supply has taken the most severe hit. In a recently published paper, Dr  Folasade Bosede Adegboye, lecturer in Finance at Covenant University, looks at what's happened to food prices in Nigeria. The linked article was first published on The Conversation.
 Weekly newsletter from CGA

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.
The latest news from the pork industry

Read more about the latest developments and news in the pork industry in the South African Pork Producers' Organisation's (SAPPO) newsletter, SAPPO Weekly Update.
Get the latest news from the FPEF

Keeping it Fresh, the newsletter of the Fresh Produce Exporters' Forum, contains all the recent relevant news and developments. Please click here for the latest edition.
 
UPCOMING EVENTS

Agbiz Congress 2021

We are currently finding ourselves in challenging and unprecedented times, and the uncertainty around what the future holds makes it very difficult for any of us to plan ahead. This also applies to the arrangements for the Agbiz Congress, which was scheduled for July this year, but had to be postponed to April 2021 due to the Covid-19 pandemic. We are soliciting advice from professional event organisers to assist us in finding the most suitable solution to host the congress next year, despite the uncertain times we find ourselves in. We will present the various options at the Council meeting on 28 August 2020 for input and recommendations from Council members. For more information, please visit the congress web page. 
2020 AgriAllAfrica Agribusiness Conference
Theme: "Imagined responses to Covid-19: Progress with the development of solutions"
29 October 2020 | CSIR | Pretoria (live event tbc)
Enquiries: Marianna.duplessis@gmail.com | +27 063 076 9135

MPO Annual National Congress, cheese-making course and AGMs
4 November  2020 | Lythwood Lodge | Lidgetton | KZN Midlands
Contact Julie McLachlan: julie@mpo.co.za or 083 740 2720

3rd African Symposium on Mycotoxicology joint MYTOXSOUTH conference 
6-9 September 2020 | Stellenbosch

Agbiz Congress 2021
Theme: "Building resilient and sustainable agri-food ecosystems".
7-9 April 2021 | Sun City Convention Centre | South Africa

Second International Congress of Biological Control (ICBC2) 
26-30 April 2021 | Davos, Switzerland
AGBIZ MEMBERSHIP
Why join Agbiz?
  • 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.

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