Wandile Sihlobo: There’s confidence in SA agriculture – from farmers themselves

If I were to be asked to name one
word I used more extensively than any other this week, it would be confidence.

I participated at the Citrus
Growers’ Association Summit held in Port Elizabeth on 13 March, and the South
African Feedlot Association’s Cattlemen’s Annual Conference in Bloemfontein on
14 March.

In both sessions, my message was centred on the role of confidence in boosting
South Africa’s agricultural economic growth, and therefore yield the jobs that
this country so badly needs. (You can download the presentation slides here.)

Aside from my presentation, both
these events offered me an opportunity to interact with growers and ranchers at
all levels – developing farmers and commercial farmers. While these industries
are different, the aspirations and concerns are somewhat the same.

In terms of aspirations, developing
farmers who attended the conferences already have products in formal or
commercial markets, particularly the citrus growers. All this has been made
possible by help from both the private sector and government – capital and passing the
‘know how. And they aspire to grow
their enterprises in scale, as a way to remain competitive in the long run.

Familiar
issues

Familiar issues are holding them
back – lack of title deeds, which then limits access to finance, the water
rights issues, and infrastructure constraints, amongst others.

A heart-warming development in the citrus
industry is the ascendance of women growers. In a panel discussion I chaired,
we had Ms Louisa Maloka-Mogotsi, a trained social worker turned farmer.  

Ms Maloka-Mogotsi aims to grow her
enterprise in the coming years, provided the aforementioned challenges are
addressed.

Trade

The issue of trade was also raised
a number of times in the discussions. The South African citrus industry has
well-established markets in the EU region, and some countries in the African
continent, amongst other regions.

But the rising production – which
will no doubt continue if developing farmers’ operations take off and they manage
to bring some of the currently underutilised
lands into production in the coming years
– has placed an increased focus on this matter.

China (and the Asia region at
large), and the Middle-East remain attractive markets for South African
agriculture due to rising incomes and population. To be clear, this is the case
for the beef industry as well, albeit that
the recent outbreak of the foot-and-mouth disease poses challenges.

Worries

In terms of key concerns, climate
change, and a lack of direction on land reform are some of the issues that
farmers are watching closely.

From a climate change side, the
discussion has slightly progressed towards questions of whether there
are any technological solutions out there
that can assist the industry to adapt to the changing climate, over and above
the required adjustment in farming practices.

On the question of land reform,
there is a general acknowledgement that land reform has to happen in South
Africa.

My sense is that farmers are jittery, mainly about the process of effecting land reform, not the subject itself. To this
end, the ongoing planning process currently underway – at Parliamentary level, and at an advisory
level to the President – will perhaps offer some guidelines over the coming
weeks.

Overall, although my presentation demonstrated
subdued confidence in the South African agricultural sector, drawing from historical data, the one-on-one conversations
with farmers show that there is an appreciation of policy dialogue, and hope
that the sector will emerge strongly in
the coming years.

The Agricultural Business Chamber
will release the results of 2019’s first quarter Agribusiness Confidence
results on Monday. This will offer a clearer view of the sentiment in this
sector. What I have explained here are conversations with a few farmers, not a
representative sample of the country.

To end on a positive note, the
citrus industry informed us yesterday that their 2019 exports could reach a
record 137 million boxes of citrus fruit to more than 100 countries. If the
policy environment is conducive, some of the revenues could be reinvested in
the farms for future long-term growth, and sustainability.

Wandile Sihlobo is chief economist of the Agricultural Business Chamber of
South Africa (Agbiz). Follow him on Twitter: @WandileSihlobo

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