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44/2023

09 November 2023

Adapting to Uncertainty: Navigating the changing global landscape in 2024

Emerging from the COVID-19 pandemic in 2020, the hope for an extended period of global stability was swiftly shattered as a conflict erupted in the Black Sea region. Subsequently, we have witnessed escalating global conflicts that have triggered significant shifts in the geopolitical landscape. This has prompted nations to reassess measures that disrupt worldwide trade, including export restrictions and pricing controls that impact global supply chains. Concurrently, the international community grapples with combating critical plant and animal diseases while grappling with the looming spectre of climate change. However, the imperative remains for businesses to persevere and adapt to the evolving global terrain. In echoing Charles Darwin's theory, it is not the strongest species that survives, but rather those that prove most adaptable to change. In light of these challenges, the 2024 Agbiz Congress theme intentionally recognises the evolving global panorama and redirects its focus towards sustaining growth in this uncertain environment. Esteemed speakers will share their perspectives on how to navigate and adapt to the complexities posed by geopolitical, environmental, and social instability. Aligned with Agbiz's ethos, the Congress aims to seek solutions that will propel the sector towards prosperity. To learn more and register for the event, we have launched our 2024 Agbiz Congress website, where you can find comprehensive information and details about this vital gathering. Visit the website to stay updated and secure your spot at this essential event. Learn more and register for the 2024 Agbiz Congress here.

Mixed trends in fertiliser prices and global supply

Fertiliser prices displayed mixed trends in October 2023. According to DTN, most fertiliser prices increased, with anhydrous fertiliser notably up by 8%. In contrast, the price of potash slightly decreased, as reported in the Illinois Production Cost Report. The USDA announced initiatives to boost domestic fertiliser production, highlighting self-sufficiency. The USDA's National Agricultural Statistics Service reported a 0.7% price index increase for September. The Agricultural Market Information System identified mixed market trends, with phosphate markets showing signs of stability. However, cautious buying prevailed, with potential risks stemming from factors like export availability and Middle East tensions. The Israel-Hamas conflict could influence fertiliser prices due to higher oil and natural gas prices during escalation. BHP Group plans a substantial investment in a Canadian potash project to meet anticipated demand growth. Nutrien expects increased fertiliser demand in the U.S. and Brazil, but its third-quarter profits fell short of estimates. The Iowa Corn Growers Association seeks pricing transparency, while low water levels in the Mississippi River may affect fertiliser transportation. Lastly, the EU's natural gas reserves are near full capacity, with excess stored in Ukraine for energy security during the winter months. Click here to read full article first published on farmpolicynews.illinois.edu.

Timely food market information vital in addressing global challenges

Accurate and timely information on the functioning of international agriculture markets is crucial in addressing climate change, conflict, and other global challenges affecting food markets. The 24th session of the Agriculture Market Information System (AMIS) Global Food Market Information Group, held at the WTO headquarters, emphasised the importance of timely food market information. Edwini Kessie, Director of the WTO's Agriculture and Commodities Division, highlighted AMIS's role in enhancing transparency in global food markets and strengthening food security. AMIS ensures that accurate, timely information is publicly available, particularly during times of market shocks. The WTO's 12th Ministerial Conference in June 2022 recognised the significance of sharing relevant information about policies affecting trade and markets for food and agriculture, with a specific acknowledgment of AMIS's positive role. Read full article first published on wto.org here.

Suspected outbreak of Foot-and-Mouth Disease in North West Province

The Department of Agriculture, Land Reform, and Rural Development has raised concerns about a suspected outbreak of Foot-and-Mouth Disease (FMD) in cattle in the Ramatlabama village, located within the Ngaka Modiri Molema District Municipality in the North West Province. This suspicion is based on positive serology results, and epidemiological investigations are currently underway to confirm the presence or absence of the virus. The farm in question has been placed under quarantine, and further investigations, including sample collection, are ongoing in the surrounding areas. Farmers in the North West Province have been cautioned to uphold strict biosecurity measures, refrain from introducing new animals into their herds, and minimise animal movement between herds and farms. Biosecurity officers are urged to ensure the implementation of these measures at places where animals gather for sales. Any suspected cases of FMD in susceptible animals must be promptly reported to the local state veterinarian. While FMD affects various cloven-hoofed animals, including cattle, pigs, sheep, goats, and domestic and wild species, it does not pose a threat to human health. The disease is characterised by symptoms such as fever, lameness, vesicles, and sores in the mouth, feet, teats, and mammary glands, leading to signs of depression and discomfort in affected animals, with significant economic implications for the livestock industry. Read full statement by DALRRD here.

How green innovation can stimulate economies and curb emissions

Facilitating access to affordable low-carbon technologies is pivotal to emissions reduction. While there has been considerable progress in green innovation encompassing electric vehicles, hydrogen, renewable energy, and battery storage, recent years have seen a slowdown in green innovation. Various factors, including falling oil prices and technological maturation, have contributed to this deceleration. Green innovation offers the dual advantage of mitigating climate change and driving economic growth. Doubling green patent filings can boost GDP by 1.7% after five years. Synchronised domestic and global climate policies significantly spur green innovation, leading to increased investment and cost-effective energy production. Protectionist measures and high tariffs on low-carbon technologies hinder innovation and impede technology transfer. Lowering tariffs and adhering to rules-based climate policies can boost trade and investment in green technologies, benefiting emerging markets and developing economies. Advanced economies have a crucial role in sharing green technology, yielding both emission reductions and economic benefits for these countries. Click here to read full article first published on IMF Blog.

Shipping giants hit SA containers with congestion charges amid massive delays at ports

Shipping giants MSC and Maersk have announced congestion surcharges for vessels at South African ports due to severe delays. MSC's Congestion Surcharge (CGS) of about $210 per container applies from December 3, while Maersk's Congestion Fee Destination (CFD) ranges from $200 to $400 per container starting December 1. Jacob van Rensburg, Head of Research and Development at the SA Association of Freight Forwarders, explained that these surcharges cover additional expenses like fuel and maintenance incurred due to congestion. South African cargo owners will pay over the global average per 40ft container, facing an additional $400 charge. DSV reported that more than 60,000 containers are stuck at Durban's outer anchorage, with severe delays affecting multiple ports. Transnet Port Terminals (TPT) issued a statement acknowledging the congestion surcharges and is committed to collaborating with shipping lines and stakeholders to find solutions to reduce berthing delays and restore supply chain fluidity. They also called for increased discussions between industry stakeholders and a potential review of the congestion surcharge implementation. South African ports are facing increased delays attributed to equipment failures, unproductive booking systems, and low productivity. This situation, according to global transport and logistics company DSV, has caused vessels to remain stranded, waiting for extended periods before they can unload their cargo. Click here to read full article retrieved from engineeringnews.co.za

AGRIBUSINESS RESEARCH

Biosecurity breaches are a significant risk to SA's agricultural growth agenda

One aspect that remains a major challenge for the domestic animal farming sector and has been raised by our members in various engagements for some time is the weaknesses in South Africa's biosecurity system. Admittedly, biosecurity breaches are not uniquely South African and have become a significant challenge globally. We frequently hear of Foot and Mouth Disease (FMD) in cattle, African Swine Fever in pigs and Avian Influenza in poultry worldwide. However, very few countries have had to deal with the scale of these disease outbreaks almost simultaneously as South Africa has had to do. In 2022, six of our nine provinces reported MFD outbreaks. The conditions haven't changed much. In fact, on November 4 this year, the Department of Agriculture, Land Reform and Rural Development (DALRRD) announced "a suspicion of an outbreak of foot–and–mouth disease (FMD) in cattle in Ramatlabama under the Ngaka Modiri Molema District Municipality in North West Province." The DALRRD added, "At this point, it is just a suspicion of an outbreak based on positive serology results. Epidemiological investigations are underway to confirm the presence or absence of virus circulation." This means that the FMD issue that was identified a year ago remains a challenge. Notably, these outbreaks weigh heavily on the cattle industry's fortunes, and the 2022 massive outbreak led to the suspension of beef and livestock product exports to a range of markets for some time. Click here to read full article by Agbiz Chief Economist Wandile Sihlobo.

The weather outlook bodes well for agriculture

We continue to receive evidence that the 2023-24 summer crop season might not be as bad as some feared when discussing the El Niño prospects. For example, on October 31, the South African Weather Service (SAWS), in its monthly Seasonal Climate Watch, noted that the “multi-model rainfall forecast indicates above-normal rainfall for the north-east of the country during November-December-January, December-January-February and January-February-March with below normal rainfall predicted for the central and south-western parts of the country”. SAWS added, “Predictions still favour above-normal rainfall conditions over the north-eastern parts of the country, even with an El Niño in place.” Considering that the soil moisture is excellent across most regions of the country from the past rainy seasons, the possibility of favourable rainfall through to early next year means that South Africa could have a better summer crop season in 2023/24. Notably, this recent update is slightly different from the message the SAWS shared in the previous month, where it said the prospects of dryness were from the start of 2024. Read full article by Wandile Sihlobo first published on mg.co.za here.

Will the avian influenza fuel food inflation?

The most dominant strains of the avian influenza in South Africa are the highly pathogenic H5 and H7. The most affected provinces so far are Gauteng, Mpumalanga, Free State, Limpopo, and North West. More than 100 mostly commercial facilities have reported avian influenza cases so far. Notably, there are reported losses in parental stock for breeders of layers and in broilers. For this reason, there are now constraints to egg supplies, as evident in various retail shelves across South Africa. Over the past few weeks, the Department of Agriculture, Land Reform and Rural Development (DALRRD) convened two critical meetings to address this challenge. Firstly, it met with the retailers. The aim was to assess the severity of the egg supplies at the retail level and assess various response measures. Second, it met with the poultry industry to receive an update on the spread of the disease and to allow the industry to obtain insights into the state's veterinary services. The significant steps following these engagements are the containment measures currently being implemented by industry and government to control the spread of the disease. Click here to read full article by Wandile Sihlobo first published on econ3x3.org.

El Nino weather conditions may boost local agricultural production

Wandile Sihlobo, recently discussed El Nino weather conditions on the "Beyond the Headlines" podcast. The conversation began with a focus on the rainy Spring season, with expectations of extended higher-than-normal rainfall into the 2023/24 summer crop season. Sihlobo believes these conditions may lead to a bumper crop yield, offering an optimistic outlook for the agricultural sector. The South African Weather Service's Season Climate Report supports this assessment. Sihlobo's expertise provided valuable insights into the potential benefits for local farmers and the agricultural industry. For in-depth information, the full podcast episode features a comprehensive discussion on the subject. Click here to listen. 

OTHER NEWS

Agbiz Grain Quarterly's November Issue: Illuminating insights and in-depth coverage of the grain industry

Agbiz Grain Quarterly is a unique magazine dedicated to keeping the grain handling and storage industry well-informed about the latest developments and challenges in the field. In the November issue, the spotlight shines brightly on the 2023 Agbiz Grain and Oilseeds Value Chain Symposium, an event that brought experts and stakeholders together to delve into pressing industry topics. Panel discussions on profitability and investment, traceability, and food safety concerns were held during this symposium, with detailed summaries featured in the pages of Agbiz Grain Quarterly. This issue also includes expert insights on crucial subjects like silo fumigation and occupational health, addressing critical aspects of grain storage and management. The November issue of Agbiz Grain Quarterly is packed with a diverse range of content. It provides readers with a comprehensive look into the industry, covering profiles of notable figures like Willie Dreyer, who is retiring from the grain industry. Additionally, the magazine delves into the vital functions and roles of South Africa's Maize and Wheat Forums, dissects the silo tariff conundrum, and explores solutions for futures quandaries. Moreover, it sheds light on the importance of traceability, the economic benefits of soya beans in the American context, and offers an overview of policy and legislation for 2023 while presenting an outlook for 2024. The issue also takes a close look at fumigation practices and emphasizes the significance of health and safety in the workplace, ensuring that readers are well-informed on every aspect of the grain industry. Agbiz Grain Quarterly continues to be a valuable resource for professionals in the field. Download your free version of this exciting publication here.

OTHER NEWS

Soil Association calls for doubling of UK fruit and veg production

The Soil Association has called on the UK government to double fruit and vegetable production in a nature-friendly manner, following a House of Lords report that described the future of the horticulture sector as "bleak." The report recommended a cross-departmental horticulture strategy, echoing the Soil Association's call for increased research and innovation funding to support the transition to more sustainable farming practices and emphasising the reduced use of chemicals. Gareth Morgan, Head of Farming Policy at the Soil Association, highlighted the challenges faced by farmers and growers, urging government intervention to address issues like limited access to healthy food, rising costs, labour shortages, and low profits. The Soil Association's manifesto commitments aim to double investment in nature-friendly farming, create an ambitious horticulture strategy, and double British fruit and vegetable production and consumption. They also call for ensuring that at least half of the food in schools and hospitals is British, local, and sustainable, improving the quality of school fruit and vegetable schemes, and fair pricing to provide a reasonable return for farmers. Additionally, the association advocates for intervention in supply chains, encouraging retailers to take greater responsibility and offer contracts that incentivize environmentally-friendly farming practices, including impacts on wildlife, soil, and carbon. Investment in local food partnerships to address food insecurity, supply chain disruption, and climate and nature emergencies is also emphasised. Click here to read full article first published on fruitnet.com.

Mashatile commits to deepen trade with China, increase value-added products

Deputy President Paul Mashatile says South Africa will continue to explore various avenues of strengthening and deepening long-standing economic, trade and people-to-people relations with China. “By advancing more South African value-added products from a top 10 category to an exponential top 100 products, we are confident that we are making progress in our bilateral trade,” he said on Sunday. The Deputy President was speaking during his open remarks at the 6th China International Import Expo (CIIE) in Shanghai. “We commend the Chinese government’s efforts to continuously host the CIIE, thereby opening this market to the world, and to Africa in particular.” Mashatile described the expo as a unique platform that provides companies around the world the opportunity to showcase their products and services, and expand their network. It is also a platform to conclude trade deals, while companies learn about the culture of doing business with Chinese enterprises and get first-hand information on compliance and adherence to Chinese protocols. Click here to read full article by SAnews.gov.za.

Organised crime on the rise: South Africa grapples with diverse criminal expansion

South Africa has witnessed a decade-long increase in organised crime across various sectors, with a focus on drug trafficking. Renowned crime analyst Dr. Chris De Kock noted that South Africa is now a key player in the global cocaine trade, citing high-level police corruption, efficient transportation networks, and resource shortages as facilitating factors. Corruption is widespread, affecting law enforcement, harbour, and airport officials. This financial scale allows organised crime groups to influence officials to ignore illegal activities. These issues extend to construction, where construction mafias extort money from contractors, causing substantial economic losses. Additionally, avocado and macadamia farm thefts have surged, costing the agricultural industry millions. The shortage of detectives, with fewer than 18,000 nationwide, poses a significant challenge. Urgent investment in intelligence and investigations is essential to combating the growing organised crime menace, which is impacting South Africa's economy and security. Click here to read full article first published on Daily Investor.

Unveiling trade profiles: A comprehensive insight into global commerce

Trade Profiles provide a vital resource for WTO Members, Observers, and select economies, drawing from customs statistics, national accounts, balance of payments data, Foreign Affiliate Statistics (FATS), and industrial property records. This information is presented in a standardised, visualised format for ease of reference. The report is divided into four sections, offering a comprehensive view of trade dynamics. The first section offers an economic snapshot, featuring GDP, trade's significance, and global trade rankings. The second section, Merchandise Trade Indicators, provides customs-based statistics on trade flows, including top products. The third section, Trade in Commercial Services, delves into Balance of Payments-based data, dissecting service trade by type and origin. The final section covers Industrial Property Indicators, presenting annual patent, trademark, and industrial design applications. Trade profiles serve as a valuable guide for those navigating the complex world of global trade. Click here to read full Trade Profiles 2023 by World Trade Organization. 

Deciduous Fruit Production Outlook in South Africa for MY 2023/24

Despite industry consolidation resulting in limited expansion, deciduous fruit production is expected to grow marginally as plantings come into production. The production of apples, pears, and table grapes is forecast to grow by 7 percent, 2 percent, and 8 percent, respectively, in MY 2023/24 based on average yield and normal weather conditions. Post foresees that South African exports of deciduous fruit in MY 2023/24 will increase due to higher production of export-quality fruit. South Africa has gained market access for pears in China since the signing of the food safety protocols in 2021. Domestic consumption of pears and table grapes is expected to decline in MY 2023/24 due to food inflation pressure on consumers and improved quality, which will shift products towards export markets for higher returns. South Africa is self-sufficient in the production of deciduous fruits and only imports small quantities to fulfil niche markets or satisfy demand during the off-season when supply is limited. Click here to read the full Fresh Deciduous Fruit Annual Report by the United States Department of Agriculture.

Seed breeders welcome landmark decision on EDVs

A landmark decision by the International Union for the Protection of New Varieties of Plants (UPOV) has extended legal protection for essentially derived varieties (EDVs), a significant development that has garnered support from prominent fruit and vegetable breeders. This decision dictates that intellectual property rights for single-parent varieties, which can arise through mutations, genetic modification, or genome editing, will remain with the owner of the original variety from which they are predominantly derived. After four years of debate, the UPOV Council formalised this decision at a meeting in late October. The matter of ownership of EDVs has been central to various legal disputes within the fruit industry. Notably, the high-profile Nadorcott-Tango case revolves around whether Tango, a mandarin variety registered as Tang Gold in the EU, is essentially derived from Nadorcott or if it possesses enough distinctiveness to warrant separate IP protection. The UPOV ruling offers relief to fruit breeders worldwide, as it clarifies that derived varieties can still retain their rights, even if they exhibit significant differences, with no upper limit specified for such distinctions. Breeders are now urging UPOV member countries to incorporate this updated guidance into their national legislation governing plant breeders' rights. Click here to read full article first published on fruitnet.com.

South African supply chain and international trade overview

In this update, BUSA examines the state of the South African supply chain and international trade. Commercial ports have faced challenges, including adverse weather, equipment breakdowns, and congestion. Port operations have been affected, with Durban experiencing congestion issues. The container shipping industry is grappling with declining trends, increased competition, and dropping charter rates. New vessel deliveries and port congestion continue to impact the industry. The air freight market shows signs of recovery, with outbound cargo on the rise. Cross-border road freight trade has seen increased transit times and border crossing delays. The pressure is on Transnet to improve performance and address logistics efficiency, as rail underperformance has had economic consequences. Resolving port congestion and enhancing the logistics network are crucial for South Africa's economic growth. Overall, challenges persist in South Africa's trade and transport sectors, demanding coordinated efforts for improvement. Read the full update in the latest BUSA Cargo Movement Update.

Transition to warmer and drier weather expected in South Africa

After a period of cool, rainy, and even snowy conditions in South Africa, a significant warming trend is now underway. While some eastern areas received substantial rainfall, many parts of the country, especially in the central maize-production region, experienced less than 10 mm of rain. Cold events during early or mid-summer, like the recent one, are not indicative of a favourable atmospheric circulation pattern for significant tropical moisture intrusion. In the upcoming days, isolated to scattered thundershowers are expected to develop over the central parts of the country, potentially causing short-term water stress. Looking ahead, forecasts do not indicate a significant rainfall event for the next two weeks, and the region may continue to experience relatively dry conditions. Global weather patterns are contributing to this, with the convergence zone for tropical moisture situated far north of South Africa. The outlook suggests the potential for warm to hot and dry weather in the interior. While a cold front is expected to influence the interior early next week, it should bring cooler, dry air rather than substantial rainfall. Late November traditionally marks a period when rainfall becomes more common in the summer rainfall region, offering hope for improved forecasts later in the month. Click here to read full CUMULUS update by J Malherbe and R Kuschke. 

MEMBERS' NEWS

Addressing challenges in fruit export season: Industry collaboration

In anticipation of the forthcoming deciduous fruit export season, industry bodies, including Hortgro, SATI, and FPEF, in partnership with Transnet, have engaged in strategic and operational discussions. These discussions are particularly focused on the Port of Cape Town (PoCT) to ensure a smooth export season. Regular meetings have been held to share information regarding expected fruit flows and port operations, especially during the peak season for stone fruit, table grapes, and early pears. Concerns within the deciduous fruit industry have led to commitments from Transnet management to enhance planning, acquire additional equipment, improve maintenance capacity, and increase spare parts availability. Transnet has also shared progress on readiness plans, seeking industry support in various areas. The discussions have included TNPA's 8-point plan, targeting port efficiency, including weather conditions, marine services, and operational visibility. CTCT and CTMPT reported on the availability of equipment and operational plans. These collaborative efforts aim to overcome logistical challenges by exploring mechanisms for maintenance capacity and equipment procurement, with cost and contractual arrangements under consideration. The industry remains hopeful that these initiatives will enhance the efficiency of the fruit export supply chain in the coming months. Click here to read the full joint statement by Transnet, Hortgro, SATI and FPEF.

The latest news from CGA

The Citrus Growers' Association of Southern Africa (CGA), shares the latest news in the citrus industry in its weekly update, From the desk of the CEO. Please click here to peruse. 

UPCOMING EVENTS

Agbiz Congress 2024

The Agricultural Business Chamber (Agbiz) invites you to attend the Agbiz Congress 2024 to explore the challenges facing us in a global economy under the banner of ‘sustaining growth in changing global landscape’. Click here to register.


AGOA 'Made in Africa' Exhibition

2-4 November 2023 | The Johannesburg Expo Centre

More Information


13th Africa Farm Management Association Conference

19–23 November 2023 | East London International Convention Centre

More Information


10th International Table Grape Symposium

26 Nov – 01 Dec | Somerset West, South Africa

More Information


Agbiz Congress 2024

5-7 June 2024 | Sun City

Learn more 

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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