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46/2023

23 November 2023

Unfulfilled promise: Assessing South Africa's economic challenges

South Africa's post-apartheid optimism, marked by the dismantling of apartheid structures three decades ago, has not translated into shared prosperity. Despite early hopes of inclusive growth and economic leverage, the nation grapples with slow, vulnerable economic growth, soaring unemployment, and persistent inequality. Catherine Kling, an environmental economist at Cornell University, and journalist Rhoda Metcalfe discuss why South Africa has failed to achieve its economic potential in a special episode of our Women in Economics series. The report identifies two core issues: collapsing state capacity and entrenched spatial exclusion. Critical sectors like electricity, transportation, and security have witnessed significant deteriorations, leading to challenges in infrastructure, energy, and public services. Furthermore, spatial exclusion, rooted in apartheid policies, persists due to inadequate urban planning and zoning policies. The report emphasises that South Africa must address both collapsing state capacity and spatial exclusion to unlock its vast economic potential and foster a more inclusive growth trajectory. Click here to read full Growth Through Inclusion in South Africa report by Center for International Development at Harvard University.

Women in Economics: Catherine Kling on nature’s real worth

Access to nature has been proven to enhance both physical and psychological well-being, with activities like walking in the forest or by a lake offering significant benefits. Despite this, nature remains undervalued in economic contexts and is often omitted from balance sheets. Catherine Kling, an environmental economist at Cornell University's Dyson School of Applied Economics and Management, has dedicated her career to generating data that urges governments to recognise and incorporate the true economic value of nature into their decision-making processes. In a special episode of Women in Economics series, Kling, along with journalist Rhoda Metcalfe, delves into the importance of assigning a tangible economic value to nature, emphasising how this approach can contribute to the preservation of natural resources. Click here to listen to full episode by IMF Podcasts. 

Controversial export permit rules spark concerns in South African farming community

In a recent development, growing concerns have emerged surrounding the implementation of new breed-based export permit rules for farmers. As per these regulations, farms deemed 'too white' may face restrictions on exporting to the EU or Britain. Notably, farmers with a turnover of 10 million rand or more are required to adhere to black management criteria to secure export permits. Despite these claims, the government has refuted the allegations. To shed light on this issue, Fokus engaged in a comprehensive discussion with Dr. Sifiso Ntombela, the special adviser to the agriculture minister, and Wandile Sihlobo, the chief economist of Agbiz. Click here to watch the full interview from SABC News Fokus.

AGRIBUSINESS RESEARCH

Agriculture increases jobs by 10%, 2023 Quarterly Labour Force Survey shows

The solid production conditions in South Africa’s agricultural sector continue to be reflected in the employment data. The Quarterly Labour Force Survey data released last week by Statistics South Africa showed that in the third quarter of 2023, about 956 000 people were employed in primary agriculture, up 10% year-on-year (and 7% quarter-on-quarter). This is well above the long-term agricultural employment of 793 000. From a regional perspective, the Western Cape, Eastern Cape, Northern Cape, KwaZulu-Natal, North West and Gauteng significantly drove this uptick in sectoral employment. The Free State, Mpumalanga and Limpopo saw a decline in jobs. As with the previous quarter, the robust production conditions of various field crops, forestry and aquaculture were behind the improvement in agricultural jobs in the third quarter. Meanwhile, the livestock industry registered a decline, which is unsurprising as the industry is confronted by various animal diseases such as foot-and-mouth, avian influenza and African swine fever. Moreover, there was a notable decline in the game industry and production of organic fertiliser facilities. Read full article by Wandile Sihlobo for mg.co.za here.

South Africa's consumer food inflation accelerated mildly in October 2023

After slowing for six consecutive months, South Africa's consumer food inflation quickened to 8,8% in October 2023, from 8,0% in the previous month. The product prices underpinning this increase were mainly milk, eggs and cheese; fruit; and vegetables. For all these products, the recent price rises will likely be a temporary blip. They are a reaction to brief supply constraints in the past few months. The avian influenza was the main issue behind the eggs supply constraints, which remain a challenge although not as acute as we saw in September and October. Regarding the vegetables, potatoes were mainly the driver of the prices in the basket as the harvest was limited following quality challenges caused by irrigation disruptions in some fields due to load-shedding in much of the year's first half. But with interventions underway in the poultry sector, such as importing fertilized eggs to rebuild the parental bird stock lost from avian influenza, importing table eggs (powder and liquid eggs that would help in the baking process and free the whole eggs for human consumption), and the ongoing processes about the possible vaccinations to curb the spread of the disease, we are hopeful that the prices will likely normalise in the coming months. Furthermore, the eggs have a lower weight within the food inflation basket, at 0.4%, which means their impact may not be as pronounced in an overall inflation figure. Click here to read full report by Wandile Sihlobo.

Beyond building a unifying and growth-enhancing vision for SA agriculture: A focus on operationalizing and implementing the plans

When structuring growth-enhancing reforms, there is value in crafting a unifying overarching vision where each role-player has a sense of ownership, responsibility, and clarity about the possibilities of success. When such a vision is implemented, each party should continuously communicate success and glitches along the way. The success stories offer encouragement and a sense of progress while outlining the snags in the process, assisting other stakeholders in knowing that there is work underway, helping them understand the challenges, and even collaborating to resolve them. When all this is missing, a vital economic reform plan may fail to receive much-needed support and full implementation. The responsibility for any collaborative reforms lies on all parties involved to check in with each other and ensure supportive energy and focus from all sides. When there is a sense that one party is not applying themselves fully, the challenge should be rectified quickly to maintain momentum in implementation. This also helps ensure that all stakeholders keep an eye on the broader vision or outcome of the policy or programme reform. Click here to read full report by Wandile Sihlobo.

Enhanced disease surveillance urgently advocated by agricultural experts

In light of recent disease outbreaks, such as foot and mouth and swine flu, agricultural experts are underscoring the vulnerabilities in South Africa's biosecurity systems. Agbiz chief economist, Wandile Sihlobo, emphasizes the critical need for increased surveillance to effectively monitor the outbreak and spread of these diseases. For an in-depth discussion on this pressing issue, catch the full interview on Newzroom Africa with Thembekile Mrototo. Click here to watch.

SA farm jobs up

The solid production conditions in South Africa's agricultural sector continue to be reflected in the employment data. For example, the data released today by Statistics South Africa showed that in the third quarter of 2023, about 956 000 people were employed in primary agriculture, up 10% year-on-year (and 7% quarter-on-quarter). This is well above the long-term agricultural employment of 793 000. From a regional perspective, the Western Cape, Eastern Cape, Northern Cape, KwaZulu-Natal, North West and Gauteng significantly drove this uptick in sectoral employment. Meanwhile, the Free State, Mpumalanga and Limpopo saw declining jobs. As with the previous quarter, the robust production conditions of various field crops, forestry and aquaculture were behind the improvement in agricultural jobs in the third quarter. Meanwhile, the livestock industry registered a decline, which is unsurprising as the industry is confronted by various animal diseases such as foot-and-mouth, avian influenza and African swine fever. Moreover, we saw a notable decline in the game industry and production of organic fertilizer facilities. Click here to listen to full episode on Agricultural Market Viewpoint with Wandile Sihlobo.

AGBIZ GRAIN

Insights Unveiled: Agbiz Grain Quarterly - November edition

Agbiz Grain Quarterly's November issue spotlights the 2023 Agbiz Grain and Oilseeds Value Chain Symposium, featuring discussions on profitability, traceability, and food safety. In an exclusive Groot Plaas TV interview, Wessel Lemmer, Agbiz Grain's general manager, addresses traceability challenges in the grain sector, click here to watch. This edition explores silo fumigation, occupational health, and profiles industry figure Willie Dreyer. It dissects the silo tariff conundrum, explores soya bean benefits in the American context, and delves into policy and legislation for 2023 with a preview of 2024. The magazine also emphasizes the importance of traceability and sheds light on fumigation practices, workplace health, and safety. Agbiz Grain Quarterly is a vital resource for industry professionals. Download your free copy here to stay informed on every aspect of the evolving grain industry. 

OTHER NEWS

Navigating Uncertainty: Impact of race rules on agricultural exports

In a recent development causing ripples in the agricultural sector, Mia Slabbert engages with Theo Boshoff from Agbiz to discuss the repercussions of race rules affecting agricultural exports. The revelation that "too white farms" may face export restrictions has stirred considerable uncertainty within the agricultural community in South Africa. Join Mia Slabbert in an insightful conversation with Theo Boshoff, CEO of Agbiz, as they shed light on the issue and provide clarity. The discussion also delves into the logistical challenges posed by these developments. Click here to watch the full interview from GROOTplaas and stay informed about the impact of these race rules on the agricultural landscape.

Overview of weather conditions and agricultural outlook

Anticipate warm and dry conditions in South Africa's summer rainfall region, impacting grain production. Despite localised thundershowers in Gauteng and Mpumalanga, overall rainfall is expected to be below normal, with an uneven distribution. A cold front is forecast to bring rain to the winter rainfall region, particularly the southwestern Cape. El Niño conditions persist, limiting widespread rainfall and tropical moisture. In the short term, the interior will experience warmth, below-normal rainfall, and scattered thundershowers. The winter rainfall region can expect showers with northwesterly winds on Monday. The summer grain production region will see increasing temperatures and sporadic thundershowers, with the potential for severity. Low-pressure troughs in the southwest and limited tropical moisture continue to challenge widespread rainfall. A forthcoming cold front may impact southwestern areas, while dry westerly winds could push thundershowers northeast. Overall, the weather pattern, influenced by El Niño, suggests a continuation of warm, dry spells with isolated thundershowers. Click here to read full CUMULUS update by J Malherbe and R Kuschke.

Overview of South African supply chain and international trade

This update provides a comprehensive overview of the South African supply chain and global trade status. Commercial ports experienced challenges with decreased container handling due to poor weather conditions, equipment breakdowns, and shortages. Port backlogs persisted in Durban, with ongoing equipment challenges. Container industry dynamics saw mid-November rate reductions, anticipating a December increase, while port congestion reached around 1.6 million TEU. In air freight, international cargo to and from South Africa decreased temporarily, but long-term trends remain positive. Regional cross-border road freight trade indicated unchanged queue times but increased transit times. Overall, South Africa's commercial ports are operating below desired benchmarks, requiring collaborative efforts for improved performance and economic stability. Read the full update in the latest BUSA Cargo Movement Update.

Adapting to global dynamics: Unveiling the 2024 Agbiz Congress

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.

MEMBERS' NEWS
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


African Agri Investment Indaba 2023

20 - 22 November 2023 | CTICC, Cape Town, South Africa

More information 


SHEQ Workshop - Occupational hygiene in the workplace

28 November 2023 | Virtual

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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