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Thirty years into democracy, how has SA’s agricultural sector performed?

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Wandile Sihlobo is chief economist at the Agricultural Business Chamber of SA and author of ‘A Country of Two Agricultures’.

Broadly, South Africa now exports roughly half its agricultural products in value terms. In 2022, South Africa’s agricultural exports reached a record $12.8bn.

There are divergent views about the effectiveness and extent to which South Africa’s agricultural policies have been implemented. Regardless of how experts feel about the capacity of the state and the policy stance of the South African government since the dawn of democracy, the one undeniable fact is that the sector has grown tremendously — as illustrated in the graph below. Data from the Department of Agriculture, Land Reform and Rural Development show that domestic agricultural output in 2022/23 was twice as much as in 1993/94.

Whether this growth has been inclusive and transformative is a question I will return to later in this piece. For now, it’s important to emphasise the growth of the industry and the drivers of its expansion. Significantly, this expansion was not driven by a few sectors but has been widespread — livestock, horticulture and field crops have all seen strong growth over this period.

Of course, the production of some crops, most notably wheat and sorghum, has declined over time. This, however, had a lot to do with changes in agroecological conditions and falling demand in the case of sorghum, not policies.

South Africa’s agriculture’s journey from 1994 (volumes of production of all agricultural subsectors). (Source: DALRRD and Agbiz Research)

These higher production levels have been underpinned, mainly by adopting new production technologies, better farming skills, growing demand (locally and globally), and progressive trade policy. The private sector has played a major role in this progress.

I use the words “progressive trade policy” solely to highlight South Africa’s standing in global agriculture. South Africa was the world’s 32nd-largest agricultural exporter in 2022 — the only African country within the world’s top 40 largest agricultural exporters in value terms. This is according to data from Trade Map.

This was made possible by a range of international trading agreements the South African government secured over the past decades. Africa and Europe now account for about two-thirds of South Africa’s agricultural exports. Asia is also an important market for South Africa’s agricultural exports.

The agricultural subsectors that have primarily enjoyed this progress in exports are horticulture (and wine) and grains. Broadly, South Africa now exports roughly half its agricultural products in value terms. In 2022, South Africa’s agricultural exports reached a record $12.8-billion.

Aside from the exports

The increase in agricultural output is why South Africa is now ranked 59th out of 113 countries in the Global Food Security Index, making it the most food-secure in sub-Saharan Africa. I recognise that boasting about this ranking when millions of South Africans go to bed hungry every day may ring hollow, as I pointed out at a few presentations where I cited these statistics. 

However, it is essential to note that the lack of access to food that most South Africans face is due to the income poverty challenge rather than lack of availability due to low agricultural output, as is the case in other parts of Africa. In essence, we need to ensure that there is employment and that households have sufficient income.

We must remember that the Global Food Security Index balances the four elements (affordability, availability, quality and safety) to arrive at a rating and covers matters at a broad national level. In this regard, South Africa produces enough food to fill the shelves of supermarkets with high-quality products but still has a long way to go in addressing household food insecurity, as many households cannot afford the food that is available in a way that meets their nutritional demands. This is a topic for another day.

Transformation

Earlier on, I noted that the consensus on agricultural growth is at variance with the diversity and sometimes polarising views around the extent to which this growth is sustainable, inclusive and transformative. The gains we’ve seen in agricultural production over the past two decades have not been equitably distributed across the agricultural industry. Specifically, the growth in the agricultural sector has been mainly restricted to organised commercial agriculture, sometimes at the expense of a distinct but heterogeneous cohort of farmers in South Africa.

As I argued in my recent book, A Country of Two Agricultures, “Nearly three decades after the dawn of democracy, South Africa has remained a country of ‘two agricultures’. On the one hand, we have a subsistence, primarily non-commercial and black farming segment; on the other, we have predominantly commercial and white farmers.” 

The book adds, “The democratic government’s corrective policies and programmes to unify the sector and build an inclusive agricultural economy have suffered failures since 1994. The private sector has also not provided many successful partnership programmes to foster the inclusion of black farmers in commercial production at scale. 

“It is no surprise that institutions such as the National Agricultural Marketing Council estimate that black farmers account for less than 10%, on average, of commercial agricultural production in South Africa. This lacklustre performance by black farmers in commercial agriculture cannot be blamed solely on historical legacies.”

While this paints a bleak picture of transformation in the agricultural sector, what we can also not ignore is the anecdotal evidence pointing to the rise of black farmers in some corners of South Africa. We see this in field crops, horticulture and livestock in the Free State, Western Cape, Eastern Cape and other regions.

Employment

Even with the adoption of technology that catalyses agricultural productivity improvements, employment in South Africa’s agriculture industry has remained robust. For example, there were about 922,000 people employed in the industry in 1994, according to data from Statistics South Africa. This is both seasonal and permanent labour. While the share of seasonal and regular labour changed over time, the broad conditions remained vibrant. In the third quarter of 2023, there were about 956,000 people working in primary agriculture, a 4% increase from 1994. 

As South Africa moves forward, let’s always be mindful of the progress that has been made in boosting our agricultural fortunes. And in the quest to grow and be more inclusive, we should be vigilant of the unintended consequences of the policies we seek to implement. Equally, we must never be complacent with the dualism we continue seeing in South Africa’s agricultural sector.

The task, then, is how to grow South Africa’s agricultural sector more inclusively and transformatively.

This will need the private sector (organised agriculture groups and agribusinesses, etc) and the government to craft a common vision for the sector with clear rules of engagement and monitoring systems. This can build on the work of the National Development Plan (Chapter Six to be specific), the Agriculture and Agro-processing Master Plan, the Land Reform Agency (yet to be launched by the government), and other progressive programmes and policies available to the nation. DM

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Comments - Please in order to comment.

  • Johan Buys says:

    Far too much fertile land (bigger than Kruger) is trapped in the Zulu trust that perpetuates a feudal system whereby hundred thousand sub-economic size farmers battle to make a living. Cooperatives with actual property titles would change that picture quickly. Then they can leverage their asset and apply technologies and systems that need scale.

  • Miles Japhet says:

    Commercial farming has always been tough – it requires great staying power. Government support under the previous regime seemed to work – perhaps there are lessons form that to be used to support new entrants ?

  • Anthony Kearley says:

    In my opinion, Transformation is a propaganda word for racial quotas, eventually enforced with legislation which penalizes good citizens who are unwilling to have their livelihoods socially engineered by a government which has struggled even to run its own SOEs. To paraphrase Milton Friedman, a society that puts equality above freedom will end up with neither equality nor freedom. Unless you also won a Nobel prize, you might want to ponder the weight of what he is suggesting…

  • Geoff Coles says:

    An intelligent article from Wandile. Perhaps some more on under-utilused land, in trusts and of course bought or otherwise acquired from previous owners.

  • Corné Els says:

    I applaud the author for highlighting the positives. Can the sentence “ there were about 956,000 people working in primary agriculture, a 4% increase from 1994” be better phrased, if one considers that the general population increase from 1994 to 2024 was 41% (43m to 61m)?

  • Paul Zille says:

    A new Land Reform Agency?? Unless this is rooted in and structurally linked to the private sector (banks, commercialised farmer co-ops, ag investors etc.) heaven help us.

    It is false to claim that “the private sector has also not provided many successful partnership programmes to foster the inclusion of black farmers in commercial production at scale.” I worked in the sector for 15 years and lost count of the number of excellent land reform partnership proposals, across all sectors and geographies, that the private sector put forward to government. I am aware of very few that were properly acknowledged or assessed, let alone pursued.

    The failure of land reform and the enduring ‘dualistic’ nature of SA agriculture is a consequence of bad policies and bad/corrupt execution. Building land reform around an enabling partnership with the private sector would transform SA’s land reform and inclusive agriculture prospects in no time. But that would mean the government giving up control of resource allocation and the patronage system that underpins land reform. What would motivate that?

  • chris Taylor says:

    A major problem when one reviews the article is that as has already been mentioned, the feudal system in KZN hinders progress. EQUALLY, the feudal system in
    The Eastern Cape also in highly fertile areas totally hinders growth and affordability. if these 2 areas were opened up to a democratic approach as covered in Guess where, The Western Cape, we would see a huge increase in commercial black farmers, food affordability improvements and probably even more agricultural exports. the market of the world awaits us.

  • Colleen Dardagan says:

    I really do have to take issue with the statement: “The private sector has also not provided many successful partnership programmes to foster the inclusion of black farmers in commercial production at scale.” This is really inaccurate and untrue. There are so many programmes run by agricultural sectors across all food production that are working incredibly hard and investing huge sums of money to assist young black people to farm. The sugar industry is an exemplary example. Really Wandile, that was a lazy and inaccurate statement by you and should be retracted. The main reason why young black people struggle to become commercial farmers is access to finance. There is more than enough land and more than enough places for them to go and learn how to become the farmers they would like to be. It seems a really difficult thing for our current leadership to give credit where credit is due and to give accolades where they are deserved. This kind of language is divisive and inaccurate and if I may say so, unnecessary.

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