In this insightful blog, IMF economists delve into the resurgence of industrial policy worldwide, driven by factors such as the pandemic, geopolitical tensions, and climate crisis. While industrial policy aims to address market failures, its complexity and potential pitfalls demand caution. The blog highlights the need for more data, analysis, and dialogue to avoid costly mistakes in implementing industrial policy measures. With over 2,500 interventions recorded globally last year, the IMF is collaborating with Global Trade Alert to monitor and analyse these developments. Recent trends show a focus on green transition and economic security, with advanced technologies and military-civilian dual-use products at the forefront. However, the IMF emphasises the importance of well-designed policies to avoid misallocation of resources and potential fiscal risks. Additionally, the IMF is intensifying efforts to collect data, assess policy effectiveness, and collaborate with the WTO to promote a multilateral dialogue on trade and industrial policy, aiming for informed and cooperative solutions to global challenges. Read full article first published on IMF Blog here.

Water levels at Lake Kariba in Zimbabwe have dropped dramatically because of the latest El Niño drought. The country’s president, Emmerson Mnangagwa, has declared a national disaster. Historian and social scientist Joshua Matanzima grew up at Lake Kariba and has spent the past 10 years researching socioeconomic life there. He discusses the impact of the latest drought on the people of the area. Where is Kariba Dam and what purposes does it serve? The 280 kilometre long, man-made Lake Kariba is part of the Kariba Dam, which was built between 1955 and 1959 in the Zambezi river basin between Zambia and Zimbabwe. The dam provides hydroelectric power to the Kariba north power station on the Zambian side and Kariba south power station on the Zimbabwean side. These provide most of the electricity for the two nations. Click here to read full report by Researcher Joshua Matanzima for theconversation.com. 

US senators from both parties have dropped plans for a legislative requirement that South Africa’s eligibility for the African Growth and Opportunity (Agoa) trade preference programme should immediately be reviewed. An immediate “out-of-cycle” review for SA would have been mandated in the “Agoa Renewal Act of 2023” which Democratic Party Senator Chris Coons proposed last November, mainly to extend Agoa for a further 16 years when it expires next year. The bipartisan Bill to extend Agoa until 2041, now also co-sponsored by strong SA critic Senator Jim Risch, the senior Republican on the foreign relations committee, and other influential senators, is about to be tabled, according to congressional sources. They confirmed a Reuters report that the Bill had now dropped the specific reference to South Africa. Click here to read full article first published on dailymaverick.co.za.

South Africa’s 29 May national and provincial elections will be the hardest fought since the birth of the country’s democracy in 1994. Surveys show the ruling African National Congress (ANC) losing its outright national majority and control of Gauteng and KwaZulu-Natal provinces. Several new political parties are actively campaigning, and there are legitimate concerns about outbreaks of violence during or after the elections. The largest recent outbreak of mass violence in South Africa was triggered by former president Jacob Zuma’s supporters in response to his July 2021 incarceration. The rioting and looting left over 300 people dead and thousands jobless, wiping R50 billion from the economy. So when members of the new uMkhonto weSizwe (MK) party, whose most prominent campaigner is Zuma, openly threaten mass violence if they don’t get their way, there’s reason to worry. Click here to read full article by the ISS Pretoria.

The SA spot price for white maize gained another 2% on Monday, bringing the increase so far this year to about 36%, sparking fears of the effect it will have on food prices and inflation. By market close the spot price of white maize on the SA exchange had risen R110 to R5,450 a tonne. Beyond the effect at the farm gate, the higher prices will put consumers under pressure while they are already battling high interest rates and inflation. While it may be a few months before consumers feel the effects, white maize is a staple crop for most South Africans, primarily low-income households, where it is used in the form of maize meal and samp. The extreme heat and prolonged dryness in February and March destroyed maize fields and other crops in various regions of the country. At the end of March, the national crop estimates committee lowered its2023/24 white maize production forecast to 6.9-million tonnes, a drop of 25% on the previous year. Click here to read full article by Wandile Sihlobo first published on businesslive.co.za.

With South Africa focused on expanding its red meat and livestock product exports, strengthening biosecurity is essential to this ambition. In part, the weaknesses in surveillance and control of the disease contributed to the spread of various animal diseases that South African farming businesses suffered in the past few years. The temporary closure of certain export markets was costly to beef farmers and wool growers. The upside of the difficulty was the realization that the government and private sector must work collaboratively to enhance the country's biosecurity system – the measures aimed at preventing disease spread. This effort is now underway, and exports are also recovering. As we recently stated, in 2023, beef exports lifted by 3% year-on-year to 27 675 tonnes. In addition, South Africa's wool exports increased by 18% year-on-year to 49 715 tonnes. The opening of export markets is evidence of the country's efforts to address animal health concerns. The deliberate marketing of livestock products to various growing export markets, such as China and Saudi Arabia, also added to this progress. Read full Agricultural Trade Digest report by Wandile Sihlobo.

Global grain supplies are comfortable, thus prices have continued to moderate. For example, the Food and Agriculture Organisation of the United Nations Cereals Price Index, which measures the monthly change in international prices of grains, averaged 111 points in March 2024, down 3% from its February level and 20% below its March 2023 value. The broad moderation in grain prices underscores improved global supplies in the 2023-24 season. The International Grains Council (IGC) forecasts the 2023-24 global maize harvest to be 1.2 billion tonnes, which is up 6% year-on-year. Moreover, the IGC forecasts the 2023-24 global wheat harvest to be 789 million tonnes, well above the long-term average. There is a lot of rice globally, with the 2023-24 global harvest forecast at 511 million tonnes, well above the long-term average. Click here to read full article by Wandile Sihlobo for mg.co.za.

Other major winter crop-producing provinces – such as Free State, Limpopo and the Northern Cape – will likely start preparing the soil around the end of May. The production of winter crops outside the Western Cape has sizeable irrigation support. These regions should benefit from the relatively higher dam levels from the early summer rainfall. In major winter grains such as wheat, nearly half of the production in South Africa is produced under irrigation. The irrigation share in overall wheat production is essential in an environment where drier weather conditions and heat waves are causing significant damage to summer grains and oilseed regions. Admittedly, the weather forecasts for the Western Cape’s winter season remain uncertain. Click here to read full article by Wandile Sihlobo for dailymaverick.co.za.

The past two years presented major challenges for the South African livestock industry. The spread of the Foot-and-Mouth Disease (FMD) and higher feed costs were the two major factors that weighed on their business. As farmers, various feedlots, and the government worked to control the spread of the FMD, the impact was deepening on the revenues of farming businesses as they suddenly had to limit the movement of animals, and various export markets were temporarily closed. In the case of the beef industry, in 2022, the exports fell below the prior five-year average, totalling 26 881 tonnes, down 16% year-on-year, according to data from Trade Map. The exports recovered slightly in 2023, up 3% year-on-year to 27 675 tonnes. Click here to listen to full episode of the Agricultural Market Viewpoint by Wandile Sihlobo.

South Africa’s Road network faces strain, but solutions like the Freight Logistics Roadmap offer promise if implemented effectively. The plan, approved by the Cabinet in 2023, aims to transform the rail freight sector through institutional reforms and private sector involvement. Key priorities include establishing an infrastructure manager and involving Agbiz Grain in prioritizing branch lines. The roadmap emphasizes private sector participation, particularly through the network access statement and encouraging private companies to maintain branch lines. These proposals offer agribusinesses a cost-effective alternative to road transport. Agbiz and its members are actively contributing to improving the rail transport environment. Click here to read full article by Agbiz Grain General Manager, Wessel Lemmer.

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.

Amid supply chain disruptions and inflation spikes, the global economy has shown resilience, with growth stabilising at 3.2% and inflation receding. However, challenges persist regionally: the U.S. grapples with overheating risks, while Europe faces sluggish growth and China contends with a property sector downturn. Emerging markets show promise amidst rising trade tensions. Priorities include rebuilding fiscal buffers to lower funding costs and enhancing growth prospects through structural reforms. Additionally, aligning the green transition with global goals is crucial for sustainable development. Multilateral cooperation remains essential for navigating uncertainties and fostering economic resilience in an ever-evolving landscape. Click here to read full report by imf.org.

The WTO's latest report forecasts a gradual recovery in world merchandise trade volume for 2024 and 2025, following a contraction in 2023 due to high energy prices and inflation. Despite a 5% decline in merchandise trade value in 2023, commercial services trade increased by 9%. Notably, global exports of digitally delivered services surged by 9%, surpassing pre-pandemic levels by over 50%. While Europe drove much of the decline in merchandise trade volume between 2022 and 2023, all regions are expected to contribute positively to export and import growth in 2024. However, regional conflicts and geopolitical tensions pose downside risks, potentially impacting food and energy prices. Despite challenges, international trade has shown resilience, with trade volume remaining flat in 2023 compared to pre-pandemic levels, emphasising its stability. Easing inflationary pressures and improving conditions for trade suggest a recovery in demand for tradable goods in 2024 and beyond. Click here to read full report.

As the inaugural International Day of Potatoes approaches on May 30, the FAO emphasises the significance of this crop in global food security and nutrition. The theme "Harvesting Diversity, Feeding Hope" highlights its role in combating hunger, poverty, and environmental threats. Originating in the Andes Mountains, the potato has become a staple crop worldwide over five centuries. FAO agronomist Makiko Taguchi emphasises promoting healthier ways of consuming potatoes to showcase varietal diversity and improve nutrition. Maintaining potato diversity is crucial for resilience against pests, diseases, and climate change. The FAO booklet calls for action from governments, international bodies, food businesses, educators, and civil society to support sustainable potato production and consumption. With around 5,000 varieties globally, potatoes play a vital role in food security, nutrition, and climate adaptation, making them essential in diets worldwide. Click here to read full article first published on fao.org.

The Department of Agriculture, Land Reform and Rural Development (DALRRD) and the Department of Trade, Industry and Competition (the dtic) have announced that SA has requested consultations with the European Union in the World Trade Organisation in relation to phytosanitary trade regulations imposed on South African citrus by the European Union (EU). This action was initiated to find a lasting solution to the EU's phytosanitary regulations on Citrus Black Spot (CBS), in order to protect the livelihoods of tens of thousands of people in the local citrus industry. The steps taken by the SA Government has the support of the Citrus Growers' Association of Southern Africa (CGA). Click here to read full statement by the Department of Agriculture, Land Reform and Rural Development (DALRRD) and the Department of Trade, Industry and Competition (DTIC).

This update provides insights into the South African supply chain and global trade dynamics. Commercial ports faced challenges, with container handling down to 6,180 per day due to weather disruptions and equipment issues, notably in Cape Town and Durban. The 2024 WTO report highlights a rebound in tradable goods demand despite a 2023 merchandise trade volume decrease. Stable GDP growth is projected, but geopolitical tensions reshape trade patterns. Digitally delivered service trade surges, emphasising the need to address geopolitical tensions for sustained growth. In the air cargo industry, ORTIA sees increased inbound cargo but a slight drop in outbound cargo. Regional road freight trade faces increased queues and transit times, emphasising the need for operational enhancements. South Africa aims to capitalise on global trade opportunities by addressing domestic challenges and adopting proactive strategies for growth. Read the full update in the latest BUSA Cargo Movement Update and visit www.saaff.org.za and www.busa.org.za for more details.

Despite facing hurdles such as the pandemic, climate change, and logistical issues, the vegetable sector continues to evolve, as highlighted in a recent Rabobank report. While production costs have risen, strong consumer demand and declining production in key markets like North America and Europe present new opportunities for major suppliers such as Mexico, Spain, the Netherlands, Turkey, and Poland. Mexico has seen a significant increase in fresh vegetable exports, driven by demand for greenhouse-grown produce in the US. Additionally, emerging players like Turkey and Poland are expanding their presence in both the fresh and processed vegetable markets. Despite higher costs, the global vegetable trade remains resilient, with consumption holding up relatively well in various regions, though consumer purchasing behaviours may vary. Click here to read full article derived from fruitnet.com.

South Africa's 2023–2024 table grape season concluded with a notable 17% increase in exports, reaching 73.5 million cartons. Despite facing logistical hurdles, including delays in shipping, the season was considered acceptable overall. The initial crop estimate of 73 million cartons was revised upwards due to a larger harvest in the Orange River Region. Changing weather patterns and rain led to an earlier end to the season. Notable cultivars showing growth include Sweetglobe (+28%), Autumncrisp (+20%), Early Sweet (+24%), and Ivory (+128%). Efforts to address future logistics challenges include the introduction of a predictive model by Transnova Africa, supported by SATI. Click here to read full article derived from freshplaza.com.

SAMIC is pleased to announce the appointment of Mr. Tom Westphal as its new Executive Director, effective May 2024. With over 30 years of experience in the food and feed industry, Mr. Westphal brings expertise in technical, operational, and commercial roles. SAMIC, established in 1997, regulates and oversees the classification and marking of meat in South Africa, expanding its services to include brand auditing and export audits. Dr. John Purchase, SAMIC's Chairman, expressed confidence in Mr. Westphal's leadership, emphasising his dedication to quality and food safety standards. Mr. Westphal's appointment underscores SAMIC's commitment to meeting high standards required by consumers and legislation, ensuring superior meat and livestock products. Click here to read full article and visit www.samic.co.za for more information.

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. 

• 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.
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• Agbiz research provides sector-specific information for informed decision-making.
• Agbiz newsletter publishes members' press releases and member product announcements.