New foreign markets for South Africa's agricultural products are expected to bring many benefits for the economy.
SA’s agricultural sector, identified by President Cyril Ramaphosa during his state of the nation address last week as one of the sectors with the "greatest potential for growth", is exploring new export markets in an effort to stimulate the economy and create much-needed jobs.
According to businesslive.co.za, Agriculture minister Thoko Didiza’s spokesperson, Reggie Ngcobo, stated that SA is in negotiations for market access to export pears to China and Taiwan, table grapes to South Korea and Vietnam, avocados to Japan, India and the US, apples to Thailand, top fruit to Mexico and citrus to the Philippines.
Agricultural Business Chamber chief economist Wandile Sihlobo explains that SA’s 7% year-on-year growth in agricultural exports, to $10.6bn in 2018, was largely due to increased exports of oranges, grapes, wine, apples, wool, lemons, mandarins and pears, among other products.
Sihlobo says access to new markets is important for SA, given that the country’s agricultural sector is export dependent. "If we are to bring new entrants into farming and create jobs, that cannot happen if exports are not prioritised in the process," he tells the FM. "SA’s opening up of all these export markets is key to further expansion of the industry."
In 2018, the top five importers of SA agricultural products and the value of the imports were:
- The Netherlands — mostly citrus, wine, fruit juices, vegetable juices, dates, figs, pineapples, avocados and guavas, worth R12.46bn;
- The UK — primarily wine, apples, pears, quinces, strawberries, raspberries and citrus, worth R10.92bn;
- Botswana — fruit juices, cane/beet sugar, sucrose and rice, worth R8.77bn;
- Namibia — maize, wine and cigars, worth R8.65bn;
- Mozambique — cane/beet sugar and maize, worth R6.82bn.
Rounding out SA’s top 10 agricultural export markets were China (R4.9bn), Lesotho (R4.5bn), the US (R4.4bn), Eswatini (R3.8bn) and Malaysia (2.1bn).
The International Trade Centre, drawing on SA Revenue Service (Sars) statistics, puts SA’s top agricultural exports for the year as the following:
- Citrus (R19.51bn);
- Wine (R9.54bn);
- Fresh or dried grapes (R9.4bn);
- Apples, pears and quinces (R8.05bn);
- Cane/beet sugar and solid, chemically pure sucrose (R7.07bn).
In the broader agricultural sector, SA exported a combined 30,000t of fresh and frozen beef in 2018, to the value of about R1.8bn — a notable increase from the 8,200t exported in 2001. Of the 14,044t of fresh beef SA exported in 2018, most went to Kuwait, the United Arab Emirates (UAE), Jordan, Eswatini and Mozambique.
Standard Bank Agribusiness head Nico Groenewald believes the country needs to look outwards for agricultural opportunities. Increased export markets mean more opportunities for financial institutions such as banks "to facilitate those trades", he says.
"Let’s hope we can turn those initiatives into practical opportunities so that we can export [more]."