He also provides more information about the latest developments in the agricultural sector. Here is Sihlobo...

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Sihlobo says the combination of a large harvest, joint efforts between the government and private sector to keep agriculture operational since the outset of the lockdown, and long-term efforts of export market development continue to pay off for the domestic agricultural sector. This, as South Africa saw a record quarterly exports of US$3.2 billion, which is an increase of 5% on a year-on-year (y/y) basis in the third quarter of 2020. He explains that the growth in agricultural exports was primarily underpinned by citrus, wine, maize, nuts, deciduous fruit and sugar cane.

The abovementioned products are expected to continue to support South Africa’s agricultural exports in the remaining quarter of 2020. “Citrus has featured prominently throughout the year and exports for 2020 are expected to reach a record 2.5 million tonnes, up 17% y/y.  Similarly, we think wine exports will continue to improve in the last quarter of the year, following the restriction of sales in the domestic markets for a certain period during lockdown and disruption of exports in the same period,” says Sihlobo.

He adds that all of this occurred during a season where South Africa’s wine production was in recovery mode from a volume perspective, with the 2020 wine grape harvest estimated to be up by 8.2% y/y to 1.3 million tonnes. Furthermore, this is similar for maize, whose 2020/21 exports are estimated at 2.5 million tonnes, up by 35% y/y, mainly on the back of a large harvest, which is the second-largest on record. Similarly, this also applies to other products that already featured prominently in the exports list in the first three quarters of the year as a result of large production volumes.

“The African continent, Asia and the European Union were the largest markets for South Africa’s agricultural exports in the third quarter of the year, accounting for 30%, 29%, and 29% in value terms, respectively. The balance of 12% by value was spread across the rest of the world, with the Americas being the dominant region,” adds Sihlobo.

Furthermore, these satisfactory exports enabled South Africa to maintain an agricultural trade surplus of US$1.7 billion in the third quarter of 2020, which is up by 35% from the corresponding period last year. Sihlobo says something that is worth noting is that agricultural imports also assisted in this robust trade balance, following a decline of 16% y/y to US$ 1.5 billion. He explains that the main imports were wheat, rice, palm oil, poultry meat and sunflower oil.

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