"South Africa’s land reform policy remains highly contested. But, in our view, a number of persistent myths about farmland statistics and the structure of commercial agriculture skew debates. This makes it difficult to reach some common understanding about the realities of land and agriculture in the country. In 1994 when South Africa became a democracy, white farmers owned 77.580 million hectares of farmland out of the total surface area of 122 million hectares. The new government set a target of redistributing 30% of this within five years. This target date has been moved several times and is now 2030. According to popular belief between 8% and 10% has been redistributed so far. But as we show below this is incorrect as it omits a number of key statistics." Prof. Johann Kirsten, director of the Bureau for Economic Research at Stellenbosch University, and Agbiz chief economist Wandile Sihlobo discuss this subject in the linked article, written for and first published in The Conversation. You can also listen to a podcast in which Wandile Sihlobo speaks with Prof. Kirsten about the article he co-authored with him on land reform in South Africa. Please click here to peruse.

Climate change is an environmental issue. It’s also clearly an economic issue, and at the heart of the economics of climate change is energy security. The ripple effects of climate change and the impacts of energy security washed across the global economy throughout 2022, leaving few safe harbours from the climate-related economic storm that’s still brewing. Of course, energy insecurity—and the economic calamities it causes—is but one of the myriad side effects of climate change that are hitting our pocketbooks. Read more in the linked article by the International Monetary Fund.

COP – or the Convention of the Parties – is the annual climate change conference held under the auspices of the United Nations. South Africa has been a participant since COP 1 in 1993. In 2011 the country hosted COP 17 in Durban. SA also hosted the World Sustainability Summit in Johannesburg. The country has a long political commitment to the climate change process. COP21 in Paris in 2015 marked a breakthrough in negotiations when most governments in the world agreed on a climate change accord. South Africa, then led by President Zuma, was among them. The late Minister Edna Molewa signed the official document on 22 April 2016 at the UN in New York. Political and trend analyst JP Landman discusses how COP27 will affect South Africa. Please click here to peruse.

Agbiz sent in a written submission to the Department of Transport commenting on the proposed Shipping Company Bill on 1 December. The Bill proposes the creation of a state-owned and state-controlled entity to participate in the carriage of exports and imports as the preferred national shipping carrier and to perform certain related services. In its submission, Agbiz points out that state-owned shipping lines have not enjoyed a great deal of success across the globe. Also, South Africa does not have a good track record in recent years as far as state-owned entities are concerned. Some of the major state-owned entities such as Denel, Eskom, SAA, the National Ports Authority and the SABC have become dysfunctional and struggle to deliver on their mandates. These state-owned entities cost the taxpayers of South Africa billions of rands every year. Agbiz head of Legal Intelligence Annelize Crosby discusses Agbiz's submission in the linked article.

Although South Africa's agricultural sector faced numerous challenges in the 2021/22 production season – from tough production conditions in grains and oilseeds, disease outbreaks in livestock, and trade barriers in horticulture – the sector sustained jobs. In the third quarter of this year, there were 873 000 people in primary agriculture. This is up by 5% year-on-year (while down marginally by 0,1 quarterly). Notably, this is well above the long-term agricultural employment of 780 000. As with the previous quarter, the increased farm activity in some vegetables, fruits and field crops sustained robust employment. Agbiz chief economist Wandile Sihlobo discusses the latest agricultural jobs data in the linked article.

South Africa’s consumer food price inflation was at 12,3% year-on-year in October 2022, roughly unchanged from the previous month. The products that continued to present upside price pressures were mainly “bread and cereals”, “meat”, and “milk, eggs, and cheese”. As we stated in the previous notes, the general consumer food price increase mirrors the surge in agricultural commodity prices over the past few months. The agricultural commodities price increase emanates from various factors such as the drought in South America, higher shipping costs, strong agricultural product demand in China, and, most recently, the Russia-Ukraine war. Wandile Sihlobo discusses the latest food inflation data in the linked article.

There is consensus amongst agricultural role players that sustainable growth in South Africa's agricultural sector cannot only be achieved through the expansion of production. An expansion of export markets should be a key support pillar for growth. This has been well-understood for many years. For nearly three decades, South Africa excelled at opening various export markets, supporting the growth the sector has witnessed since 1994. South Africa has successfully negotiated several free trade agreements (FTAs) over the past few decades with critical regional and international markets. In the linked article, Wandile Sihlobo discusses this subject.

Land reform and redistribution are divisive topics for South Africans. But many of the details the arguments are based on are flawed, misunderstood, misrepresented, and even false. Agbiz chief economist Wandile Sihlobo and Prof. Johann Kirsten from the Bureau for Economic Research have penned the top five myths about land reform and farming in South Africa (see article in the first section of the newsletter). Wandile Sihlobo joined eNCA in an interview to unpack what is fact and what's not. Please click here to peruse.

The United States Department of Agriculture (USDA)'s Pretoria office is a key institution and it is worthwhile to keep an eye on their views. They recently released an updated view of South Africa's 2022/23 maize production season, leaning strongly towards the views of South Africa's Crop Estimates Committee (CEC). They forecast the country's commercial maize plantings at 2,60 million hectares in the 2022/23 season, broadly aligned with the CEC, whose data points to a possible area of 2,59 million hectares. This area is slightly below the 2021/22 season of 2,62 million hectares. In this week’s segment of the podcast, agricultural economist Wandile Sihlobo, provides more colour on these dynamics and their impact on grain prices. Please click here to listen to the podcast.

The Department of Trade, Industry and Competition (the dtic) has relaunched the Agro-Processing Support Scheme (APSS) in order to increase the uptake of the incentive programme, which is aimed at stimulating investment by South African agro-processing enterprises. According to the chief director of Strategic Partnership and Customer Care at the dtic, Tsepiso Makgothi, the amendment of the APSS was the result of an engagement with various stakeholders and businesses where it became apparent that some companies did not have the minimum R1 million investment that was required, while others were of the view that the APSS guidelines were too onerous. “Agro-processing remains a key priority economic sector as per the Industrial Policy Action Plan (IPAP). A key characteristic of agro-processing is its strong upstream and downstream linkages. Although other incentive programmes for the manufacturing sector have been effective in achieving their intended objectives, a dedicated incentive scheme has greater potential in creating an enabling environment for small and medium businesses in the agro-processing industry to participate meaningfully in the mainstream economy,” says Makgothi. Please click here to peruse.

The relationship between food security, trade and the environment is a complex but increasingly important one. The impacts of climate change have undermined progress in food security and threaten to continue setting Africa back in achieving the UN Sustainable Development Goal 2 of Zero Hunger by 2030. Trade plays a critical role in food security in the face of climate change, ensuring that food can move from areas with food surpluses to those facing food shortages. As climate change impacts regions and their food production differently, this balancing-out function will become increasingly important. The linked tralac trade report discusses some key issues in the WTO Agreement on Agriculture negotiations that need to be addressed, including public stockholding programmes. It also discusses some adaptation measures that address the continent’s key climate-related challenges in the agricultural sector, outlining the potential of deeper regional integration to accelerate the transition to food system resilience.

Agbiz was invited to attend the inaugural Manufacturing Circle Export Forum, held on 28 and 29 November 2022 in Pretoria. The forum focused on how business and government can work together to access export opportunities. The forum brought together industry; financial, research and advisory institutions; trade specialists and negotiators; government representatives; and policymakers. Theo Boshoff, Agbiz CEO, presented on exporting competitively, and outlined progress made with regard to logistics in Agbiz’s engagements with Transnet. Wolfe Braude, Agbiz Fruit manager, presented on Agbiz Fruit and Agbiz’s numerous policy engagement processes with government, and showcased the Fruit Industry Value Chain Roundtable Trade Working Group and its practical approach to policy implementation and trade facilitation. The roundtable is unique in that it includes representatives from the industry, as well as DALRRD, the dtic and DIRCO. The model was received very positively, with attendees expressing interest in replicating it within their various subsectors.

In celebration of a number of Agbiz members who celebrated their 100 years of existence, an annual Agbiz Centenary Bursary Fund was established. The primary objective of the bursary is to promote master's, or PhD level research in agribusiness-related fields and Agbiz certainly is proud to be associated with and to support the set research of Agbiz Centenary Bursary holders. The annual bursary of R41 000.00 is available to a South African student registered for a master’s or PhD degree in either agricultural economics or agribusiness management-related fields, at any recognised South African university in 2023. Terms and conditions apply. For more information, read the Terms and Conditions Document. Applications for the 2023 bursary, complete with a completed application form and the required documentation, should reach Agbiz via email or mail before 6 December 2022. For enquiries please contact Liezl Esterhuizen on 012 807 6686 or e-mail admin@agbiz.co.za.

"In the uncertainty of life, the one thing we can be sure of is change." That was the theme of the Cherry Association's annual general meeting, which took place on 27 July 2022 in Paarl. Hortgro Cherries chairperson Arno Marais said that change is not always easy, but it is the people and the businesses that view change as an opportunity and that can adapt, which stay ahead, and this is what Hortgro Cherries tries to achieve. Over the last five years, the area planted under cherries has increased by 77%, with 24 producers farming on 33 farm units, according to Nina Viljoen, economist at Hortgro. According to Viljoen, the area planted in the next five to six years could expand by 90% to 1035 ha. Read more in the linked article, first published on FreshPlaza.

Hortfin the blended-finance scheme created to facilitate and enable transformation in the fruit, table grape and wine industries’ value chain, has announced a new partnership with First National Bank (FNB) at an event at Klein Joostenberg, Muldersvlei. Hortfin, a comprehensive financing and support system that promotes job creation, transformation, and sustainability was launched in 2018, with the fruit, table grape and wine industries, the Jobs Fund, and the Land Bank as custodians. The need arose to bring on board an alternative financial partner to ensure sustainable growth within the agri sector. Last year, several discussions were held with commercial banks as well as impact funders, and FNB seized the opportunity to enter the programme as co-financier in December 2021. The Hortfin/FNB industry agreement event aims to celebrate and launch this new partnership. This agreement aims to finance projects that meet the Hortfin entry requirements, in terms of both sustainable and transformed businesses in the deciduous fruit industry (including pome and stone fruit, as well as table and wine grapes) and its value chain, and that could create new jobs. Please click here to peruse.

South African wine businesses and various stakeholders will get together at the start of 2023 to explore the state of the industry and equip themselves with insights and tools needed to connect with each other to grow their wine businesses and the industry. The Nedbank Vinpro Information Day, with the theme "Connect and Grow" will be held from 09:00 to 14:30 on 19 January 2023 at the Cape Town International Convention Centre (CTICC). “No person, business or industry operates in isolation,” says Rico Basson, Vinpro MD. “Being connected to the people and things around us not only makes us human, but also drives business success. At the Nedbank Vinpro Information Day, we will explore how the wine industry and wine-related businesses can leverage the networks and connections in our midst to ensure sustainable growth.” The event will be hosted as two themed back-to-back sessions of 120 minutes each, with an hour-long break between the sessions. Please click here for more information.

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