TEN YEARS IN AGRICULTURE: the winners and the losers

As another decade draws to a close, clear winners and losers have emerged on the agricultural front. While the industry is in a better position overall than 10 years ago, a bumpy road lies ahead. Lindi Botha reports.

- Lindi Botha

In 2010, the world was emerging from a global recession, and prospects for future growth looked rosy. South Africa’s economy was predicted to achieve a 5% annual growth rate, with a steady exchange rate of R11/ US$1 over the next decade. Agriculture was predicted to create at least 300 000 additional jobs by 2020.

In reality, the sector managed only a third of that. But far from all being doom and gloom, agriculture has much to celebrate in looking back over the past 10 years. While the country has managed an annual growth rate of less than 1%, agriculture has averaged 2% in real terms, a remarkable feat considering the string of problems it has faced. Despite enduring South Africa’s worst drought in 112 years, a listeriosis outbreak, and multiple cases of avian influenza, African swine flu and foot-and-mouth disease (FMD), to name only some of the challenges, the sector grew in line with other Southern Hemisphere countries such as Chile, Argentina and Australia. Moreover, although the rand did not hold as firm as predicted 10 years ago, its weakening against currencies such as the dollar and the euro aided export-driven industries such as citrus, avocados and macadamia nuts.

Dawie Maree, head of communication and marketing at FNB Agriculture, says that as far as commodity prices go, South Africa is more or less on the same level in real terms as it was 10 years ago.

“Farmers have had to improve productivity and efficiency to stay in business. This hasn’t been easy, given the enormous pressure from the political environment. The latter had a significant effect on investment, be it new or replacement investment, in the industry.”

Prof Ferdi Meyer, director of the Bureau for Food and Agricultural Policy, concurs that South Africa has not been out of sync with global growth.