We do not emphasise enough the critical role of exports in driving SA’s agricultural growth.
If one looks at the past three decades, this sector has more than doubled in value and volume.
Indeed, the improvements in genetics and cultivars, among other interventions, are the primary catalysts that delivered this growth.
But another critical catalyst is exports. This is a point I illustrated at length in my book, A Country of Two Agricultures.
We now export roughly half of what we produce agriculturally in SA, with exports valued at nearly $14bn (R252bn) in 2024.
We are not even at capacity in terms of agricultural production, as we have roughly 2.5 million hectares of government-owned land that was previously commercially farmed, but is now sub-optimally used.
We also have capacity in the former homelands to increase agricultural output.
When this underused land is finally released to deserving black farmers, with title deeds, paired with affordable finance, and partnerships from commodity associations, we will be able to drive agricultural output to new heights.
But we won’t be in a position to absorb that output in the domestic market.
We will need to look at export markets. These exports are also key in ensuring that the farming businesses remain financially viable and can sustain jobs, and provide economic value to various communities.
And yes, we don’t just export without first taking care of domestic food needs.
The exports are primarily a surplus. (The poverty issues we all are aware of in SA are mainly an income poverty issue, not necessarily an agricultural question)
It is this reality that has always compelled me to speak more about the need to expand our export diversification efforts.
I was encouraged on Monday when I heard the key policymakers in the trade and international relations space pushing this message strongly.
In a joint media briefing by SA’s ministers of international relations & cooperation and trade, industry & competition, the intent to rigorously pursue export diversification was made clear.
“We have been strengthening trade and investment partnerships with various trade partners.
“These efforts are bearing fruit, targeting markets across Africa, as well as in Asia, Europe, the Middle East, and the Americas,” the ministers stated.
“We are making significant inroads into new, high-growth markets across Asia and the Middle East, including the UAE, Qatar, and Saudi Arabia.
“These efforts are not only opening doors to new opportunities but also reinforcing our commitment to retaining the vital markets we already have.”
With this clarity on the importance of export diversification, SA’s agricultural community must rally behind this message.
The first step must be to support the government with insights that further help them in engaging with the new markets and their prioritisation.
This may not be something that people have on their minds, especially in the fast-evolving world of global trade.
Thus, supporting research efforts on trade to provide up-to-date key insights that guide us in decision-making is vital.
Another aspect we will have to assess is capacity readiness in the various government departments that are directly engaged in trade matters, specifically the departments of international relations & cooperation and trade, industry & competition.
This also means SA will have to adjust its approach on trade matters and be more open to free trade agreements, understanding there are trade-offs they bring.
You cannot want to win in all industries. There will be tough choices of trade-offs that the policymakers will have to make.
The countries we want to diversify to may also want to sell something from SA.
This is particularly true today, where all countries are under pressure to expand their export markets given the disruption caused by the US trade policy.
The senior officials in the trade department will also need to align with this new approach, which may be a slight shift in orientation from the established way of approaching trade policy matters.
Ultimately, export diversification is key to the long-term growth of SA’s agricultural sector. We should keep this work going!
- Wandile Sihlobo is the chief economist of the Agricultural Business Chamber of SA.
The Herald