News archive

News archive - July-2018

Stable global food supply feeds bright inflation outlook

The world is in a far better place in terms of food supply and costs than in the recent past. This is evident in the Food and Agricultural Organisation food price index, which averaged 173.7 index points in June, down 1.3% from May and a percentage point from the same time in 2017. This was underpinned by a decline in global grain, vegetable oil and dairy product prices due to large supplies. - Wandile Sihlobo, Agbiz head of Agribusiness Research  *Written for and first published on Business Day on 2 August 2018.  

02.08.2018 / Agbiz in the news

More

SA's logistics amongst the best in the world

South Africa’s logistics are comparatively more efficient than most industrialising countries, albeit showing a concerning trend in having regressed from 2016’s ranking. This is according to the World Bank’s Logistics Performance Index which ranked South Africa at number 33 out of 160 countries surveyed, down from number 20 in 2016, with Germany still leading the world. With growing expectations that South Africa could potentially have large agricultural surpluses for export markets, particularly in maize, the logistics services will play a critical role in ensuring the success of the activity.  –  Wandile Sihlobo, head of Agribusiness Research

31.07.2018 / Agbiz in the news

More

Cairns Group Farm Leaders disappointed at new US agricultural subsidies

The Cairns Group Farm Leaders are deeply concerned by the United States (US) Administration’s announcement that the US Government will provide US$12 billion to support US farmers impacted by tariffs imposed on US agricultural exports.

27.07.2018 / Media Releases

More

Agbiz participates in BRICS Business Forum

Against the backdrop of a full-blown trade war between the US and China, and the US also targeting, amongst others the European Union and fellow North American Free Trade Agreement (NAFTA) countries (Canada and Mexico), thus foe and friend alike, the BRICS Business Forum was held at the Sandton Convention Centre on Wednesday, 25July 2018. Dr John Purchase, as board member of Business Unity South Africa (BUSA), attended the forum and shares some perspectives.

27.07.2018 / Agbiz in the news

More

Why do African countries consume what they don’t produce, and produce what they don’t consume

One of the most prolific messages from the Nelson Mandela centenary lecture presented by Prof Patrick Lumumba was that Tata Madiba would have asked why do African countries consume what they don’t produce, and produce what they don’t consume. He further made a point about coffee, cocoa, tea and other raw commodities that are exported by African countries, and then import expensive, high-value finished products derived from the same inputs they exported. - Dr Mmatlou Kalaba, a trade economist with the University of Pretoria and the Bureau for Food and Agricultural Policy and Wandile Sihlobo, Agbiz head of agribusiness research. 

26.07.2018 / Agbiz in the news

More

Expect Western Cape drought to knock farm exports

Agriculture has its fair share of challenges, but I try to find uplifting domestic and regional developments to discuss. This week, agricultural trade was in my cross hairs. For context, I recently reflected on the positive trade performance in calendar 2017, when South Africa's agricultural exports surpassed $10 billion (about R134 billion) for the first time, boosted by growth in exports of edible fruits, beverages, spirits, vegetables, grains and other farm products. The $10.0 billion figure represented a 15% year-on-year increase from $8.7 billion. Africa and Europe were the largest destinations for agricultural exports, collectively absorbing 67% of total exports last year in value terms. Asia was also an important market, taking 24%. The Americas and the rest of the world accounted for 5% and 4%, respectively. In the same period, imports increased by 5% year on year, reaching $6.7 billion, particularly driven by wheat and rice. – Wandile Sihlobo, Agbiz Head: Agribusiness Research *Written for and first appeared on Business Times on 16 July 2018

19.07.2018 / Agbiz in the news

More

Large grain supplies help bring some relief to consumers

I often use this column to present an update of domestic and regional food and agricultural production conditions. Earlier in 2018 I shared the positive outlook for SA’s summer and winter crop production. Earlier in 2018 I shared the positive outlook for SA’s summer and winter crop production. As farmers wind up the summer crop harvest process and winter crop planting approaches completion in the country, I think it’s appropriate to present an update again. This time around I have good and bad news. – Wandile Sihlobo, Agbiz Head: Agribusiness Research *Written for and first appeared on Business Day on 19 July 2018

 

19.07.2018 / Agbiz in the news

More

South Africa needs to create an enabling environment for small businesses to thrive

It is no secret that South Africa, like many emerging economies around the world, is struggling to tackle the triple challenges of poverty, inequality and unemployment. These challenges are not insurmountable, but we are currently on the wrong side of the curve with signs that the economy is more concentrated than ever before. Unemployment, and youth unemployment, in particular is a ticking time bomb as the majority of South Africans are excluded from the mainstream economy. – Theo Boshoff, Agbiz Head: Legal Intelligence *Written for and first published in Mail & Guardiian on 13 July 2018

19.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Spotlight on SA's trade relations

Europe remains a major market for South African agricultural exports and has growth potential, but a partnership approach is needed to address the sanitary and phytosanitary (SPS) and technical barriers to trade (TBT) measures affecting exports such as citrus, said Sifiso Ntombela Agbiz head of International Trade and Investment at the congress.

16.07.2018 / Agbiz in the news

More

Has expropriation without compensation debate started negatively affecting investment in SA agricultural sector?

We typically use the Agbiz/IDC Agribusiness Confidence Index to gauge the health of the South African agricultural sector, as well as the potential investment path. Of late, a number of commentaries have surfaced arguing that the discussions about the proposed expropriation without compensation have not negatively affected investment in the agricultural sectors, suggesting that investment has actually increased over time. This argument leans on investment in JSE food listed companies, which we believe would not be an ideal measure of observing investment in farming. - Wandile Sihlobo, Agbiz Head: Agribusiness Research and Dr John Purchase, Agbiz CEO

13.07.2018 / Agbiz in the news

More

Black farmers of Eastern Cape reap harvest of success

South Africans are a very inquisitive nation. Each time I tweet about South Africa's agricultural fortunes, someone asks about proportions of that particular product in racial terms. This past week, I posted a chart about liquor consumption – 76% of it is accounted for by beer. Almost immediately, the question popped up – what proportion of the barley and sorghum used to make the beer was grown by black farmers? – Wandile Sihlobo, Agbiz economist *Written for and first published in the Business Times on 08 July 2018.

12.07.2018 / Agbiz in the news

More

Farming 101 teaches the importance of land ownership to leverage returns

Since the passing of the parliamentary motion to review section 25 of the Constitution there has been an explosion of views on land reform, land tenure regimes and state ownership of land. From these debates it has become clear that there are diverse views on the value of land and its role as an instrument of financial security and leverage. – Wandile Sihlobo and Prof Johann Kirsten *Written for and first published on Business Day on 9 July 2018

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Water: urgent call to action

Without intervention the national water deficit will be around 17% by 2030. Water availability could also deteriorate as supply contracts and demand escalate due to growth, urbanisation, inefficient use, degradation of wetlands, water losses and the negative impact of climate change. This was the opinion of Trevor Balzer, deputy director general: Strategic and Emergency Projects of the Department of Water and Sanitation, at the 2018 Agbiz Congress.

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Technology opens new landscapes

Farmers face an ever-changing landscape, while constantly striving for higher yield, resilience and desirability. They need seeds and crop protection products that address their challenges – not just by country or region, but that are laser-focused down to the acre. This was the message at the 2018 Agbiz Congress of Dr Neal Gutterson, chief technical officer R&D and product development of Corteva Agriscience.

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Restoration of dignity is key to land reform

"Agbiz input with regard to land reform so far was primarily viewed from a commercial perspective, thus the creation of successful and viable new entrants. This is only one part of the story. The restoration of dignity is also key to the debate, but how does one do this practically?" Theo Boshoff, Agbiz head of Legal Intelligence discussed the current policy environment for land reform and the relevant legislation at the 2018 Agbiz Congress and said that Agbiz is closely involved in many land reform forums.

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Model will help to identify export opportunities

Trade facilitation and cost reduction strategies can help to unlock South Africa’s economic potential through increased exports and more scientific fact-based market intelligence. This should be at the centre of strategic decision-making and trade facilitation initiatives, increasing trade in goods and services between South Africa and the rest of the world. The same applies to agro-industry related stakeholders. This was the message to the 2018 Agbiz Congress of Prof Wilma Viviers, director of the TRADE research entity and World Trade Organization chair holder at the North-West University, and Martin Cameron, managing director of the TRADE Research Advisory. 

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - President Ramaphosa has done well so far, but an uphill battle lies ahead

President Cyril Ramaphosa has taken a number of important steps so far this year in stage one of the Ramaphosa reform era. These include recalibrating key areas of economic and institutional importance. He also overhauled the security cluster, said Goolam Ballim, chief economist of Standard Bank, at the 2018 Agbiz Congress.

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Partnerships are important, but must ‘be meaningful’

Mike Mlengana, director general of the Department of Agriculture, Forestry and Fisheries delivered the keynote address at the 2018 Agbiz Congress and placed public–private partnerships in the spotlight.  “These partnerships are important for the South African economy, but they must be meaningful and they must have a meaningful impact on people’s lives. We must have a strategy and a clear vision about these partnerships,” he said.

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Not a time to sit back and relax

“Don’t be too excited that the Zuma error has been terminated. Change, however, could be intoxicating. Agribusinesses must invest in building confidence. Now is not the time to sit back and relax under Ramaphoria. The president is crying for help.” This was the opinion of Mpumelelo Mkhabela, political analyst and a fellow at the Centre for the Study of Governance Innovation at the University of Pretoria, at the 2018 Agbiz Congress. 

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Land reform: what can the private sector contribute?

Current programmes of smallholder support from the private sector are built on shaky foundations. They are often based on problematic assumptions and normative ideas informed by the experience of a successful (white) and large-scale commercial farming sector in South Africa. A fundamental rethink is required, said Prof Ben Cousins, DST/NRF research chair in Poverty, Land and Agrarian Studies at the University of the Western Cape, at the 2018 Agbiz Congress.

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Agricultural markets will grow but prices will remain the same

Agricultural markets will grow but prices will stay more or less as they are today. The only way for agricultural producers to remain in business is to build their margins. This was the message of Prof Marcos Fava Neves, professor at the Business School of Economics, Business Administration and Accounting at the University of São Paulo, Brazil, to the 2018 Agbiz Congress.

11.07.2018 / Agbiz in the news

More

2018 Agbiz Congress - Agriculture cannot be measured in terms of money alone

Agriculture and agribusinesses annually contribute around 14% of total GDP to the economy of South Africa but the value of these sectors cannot be measured in money alone. They make a huge contribution to rural development and sustainable employment. At last calculation, the turnover of Agbiz members, including lending exposure of financial institutions, was in the region of R400 billion per annum, considerably greater than the total farm-gate value of agricutural production in South Africa. The participation of Agbiz members is, therefore, crucial to take agriculture and agribusiness forward in South Africa, said Dr John Purchase, CEO of Agbiz in his opening address at the 2018 Agbiz Congress.

11.07.2018 / Agbiz in the news

More

South African tractor sales grew by 19% y/y in June 2018

The South African tractor sales increased by 19% y/y in June, with 569 units sold, which is the highest sales figure for the corresponding month in a dataset starting from 2014. This far exceeds our expectations of modest sales of 471 units, which is a surprise given that June is a fairly quiet month in terms of planting for both summer and winter crop areas. – Wandile Sihlobo, Agbiz economist

09.07.2018 / Agbiz in the news

More

SA agricultural economy contracted by 24.2% q/q in the first quarter of 2018

The negative effects of the Western Cape drought are evident in the first quarter GDP data, which showed that South Africa’s agricultural economy contracted by 24.2% q/q.1 This far exceeds our expectations of a modest contraction of about 11% q/q. – Wandile Sihlobo, Agbiz economist

09.07.2018 / Agbiz in the news

More

SA maize and soybean production forecasts revised upwards

South Africa is in for a fairly good harvest in 2017/18 production season, albeit being less than the record achieved in 2016/17 season. This was confirmed by the fifth production forecasts released by the National Crop Estimate Committee earlier. Most summer crop production forecasts were revised upwards from previous month’s levels, with the exception of sunflower seed, sorghum and dry beans which were left unchanged. – Wandile Sihlobo, Agbiz economist

09.07.2018 / Agbiz in the news

More

Agbiz gearing up for the President’s proposed jobs summit

At his maiden State of the Nation Address in February, President Ramaphosa announced that a jobs summit would be convened in 2018 to elevate the key challenge of unemployment, with a special emphasis on youth unemployment, to the top of the national agenda. The aim of the summit is not limited to creating formal employment opportunities but rather to creating viable economic opportunities, including the creation of new enterprises and self-employment opportunities. The summit seeks to address the constraints to job creation, affirm targets and commitments from different entities and solicit proposals for specific projects. To this end, government has enlisted the help of social partners at Nedlac where Agbiz will play a leading role through Business Unity South Africa (BUSA). – Theo Boshoff, Head: Legal Intelligence

06.07.2018 / Agbiz in the news

More

Scope for growth and employment in agricultural sector

I recently posted a graph on Twitter showing the past 100 years of South African agricultural employment, which has of course been declining for some time, in line with the international trend. The feedback from a couple of interactions suggested that the agricultural sector is a nonstarter when it comes to job creation. – Wandile Sihlobo, Agbiz economist *Written for and first published in the Business Day on 21 June 2018.

06.07.2018 / Agbiz in the news

More

Dryland wheat farming in Eastern Cape needs support

Almost every Sunday afternoon I make a couple of phone calls to a number of farmers across the country to catch up on regional news and agricultural conditions. This past weekend I followed that routine, with a number of farmers briefing me about summer crop harvest progress.Wandile Sihlolo, Agbiz economist *Written for and first appeared on Business Day on 05 July 2018

06.07.2018 / Agbiz in the news

More

SA sugar industry appeals for stronger tariff protection

The members of the South African Sugar Association (SASA), which includes sugarcane farmers and millers, have applied to the International Trade Administration Commission (ITAC) for a 51% increase in the sugar tariff (dollar-based reference price of US$ 856.32/ton) to help the industry against the increasing sugar imports. – Sifiso Ntombela, Head: Trade and Investment Intelligence

06.07.2018 / Agbiz in the news

More

If Zimbabwe lifts maize ban, South Africa can step in

I keep a close eye on the Zimbabwe agricultural sector because of its potential impact on regional demand. Since the collapse of the sector after the land reform programme in the early 2000s, the country has been one of the key markets for South African maize. – Wandile Sihlobo, Agbiz economist *Written for and first published in the Business Times on 01 July 2018.

06.07.2018 / Agbiz in the news

More

Copyright © 2018 by Agricultural Business Chamber