Amid power cuts, there are factors working in SA farmers' favour

As farmers plant winter crops, including wheat, canola, barley and oats, Wandile Sihlobo, chief economist at Agbiz, outlines reasons to feel more optimistic in a challenging operating environment.

- Wandile Sihlobo

"Winter is an important season for South African agriculture, with some of its key field crops being produced during the cold months of June, July and August, and maturing after that, with harvesting in December. Preparation of the land for winter crops begins in April, which is the same time that harvesting of the summer crops begins.

Farmers in the Western Cape and Northern Cape, the Free State, Limpopo and other winter crop-growing regions are making arrangements for growing winter wheat, canola, barley and oats.

All of the country's wheat production takes place during the winter months, making the winter season an important contributor to the country's wheat needs. South Africa produces roughly 60% of its wheat requirements and imports the balance. It also produces, on average, about 90% of its annual barley consumption. Domestic production of oats is about 64% of annual consumption. The country is self-sufficient in canola production.

This year, the outlook for winter crops is clouded by a difficult operating environment, especially in the areas that are under irrigation.

HEADWINDS AND TAILWINDS

The two biggest headwinds are power cuts and dollar strength. Nevertheless, there are also positives that should take some pressure off the food price rises which have hit consumers so hard. These positives include a fall in the cost of inputs, such as fertiliser and agrochemicals, as well as good harvests from the summer season just ending.

The main contributing factor in terms of negative factors is the increase in recurring power cuts, which will affect irrigation. South Africa's agriculture sector has never faced a period of power cuts as severe as the current one.