The Agbiz/IDC Agribusiness Confidence Index (ACI) moved between 38 and 58 during 2024 before climbing to 70 in the first quarter of 2025. It has since eased, declining to 65 in Q2 and 63 in Q3.
According to Dawie Maree, head of agriculture marketing and information at FNB, sentiment remains stronger than in 2022–2024. He attributed this to political stability following the formation of the Government of National Unity, improvements at ports, over 100 days without load-shedding, lower interest rates, and favourable rainfall.
Maree said the latest decline was mainly linked to uncertainty over foot-and-mouth disease (FMD) and new US trade tariffs. "The US tariff is a problem, but it is not as big as initially feared, with producers already taking steps to manage it," he noted. He added that both issues could ease as the FMD vaccine rollout progressed and the impact of tariffs became clearer.
Of the ten subindices that make up the ACI, five declined in Q3 while five showed mild improvements. The market share subindex dropped six points to 59. Employment confidence decreased by five points to 50, reflecting the 3% drop in farm jobs to 906,000 in Q2. Capital investment confidence fell by eight points to 67, despite steady tractor and combine harvester sales.
Export volume sentiment dropped by 17 points to 43 due to concerns over US tariffs and global trade conditions. However, Agbiz data showed that exports grew 10% year-on-year in Q2 to reach US$3.71 billion (about R70 billion). General agricultural conditions decreased by 13 points to 67, reflecting ongoing animal health concerns. Still, favourable rainfall for both summer and winter crops kept conditions relatively stable.
Other subindices improved. Turnover confidence rose by 20 points to 75, while net operating income increased six points to 71. Financing cost sentiment improved as interest rates eased, with this subindex down 14 points to 71. Debtor provision for bad debt remained unchanged at 50.
Wandile Sihlobo, chief economist at Agbiz, said the results suggest that the sector's recovery in 2025 will be uneven. He added that the emphasis on geopolitical issues in the survey reflects South Africa's dependence on exports and the need for diversification.
"BRICS countries, particularly China, India and Saudi Arabia, offer major opportunities, but we must also maintain strong links with existing markets in the EU, UK, Africa, Asia, the Middle East and the Americas," he told Farmer's Weekly. Sihlobo also highlighted the importance of stronger partnerships between business and government to address biosecurity, improve municipal management, and allocate state land to appropriate beneficiaries.
Source: Farmer's Weekly
