Exports and infrastructure will determine agriculture’s winners and losers

Ahead of this year’s general elections, FairPlay has solicited the views of experts on the priorities, opportunities and constraints facing South Africa’s agriculture sector.

Here, award-winning agricultural economist Prof Johan Willemse identifies the basics that the new government must get right over the next five years.


It is unfortunate to note that South Africa’s economy isn’t growing, and its agriculture sector certainly isn’t matching its growth potential.

Vast portions of the consumer market are moving toward cheaper foodstuff – the rise in sales of “walkie talkies” (chicken heads and feet) is indicative of this trend. So is the reported move to VAT-free canned pilchards. Consumers can’t contend with the level of inflation, and that puts the pressure on farmers to ensure they maximise efficiency, while keeping their prices low, while all other costs are on the rise.

But that’s not to say agriculture can’t be the engine to rouse our slumbering economy. For these producers to survive in a shrinking economy, they have to downscale production, alternatively, they could start exporting.

Some 52% of the agriculture industry’s revenue comes from exports, which illustrates that the techniques and technology we employ are world-class, but the local market is restricted. Developing South Africa’s export markets will drive efficiency and lower local prices – eminently desirable for all. However, when we discuss the poultry sector specifically, it’s not as simple as just exporting more; this must be combined with a rigorous vaccination and biosecurity programme. 

This specific area has highlighted many constraints over the last few years – from the sanitary and phytosanitary requirements of other markets to the shortage of local veterinarians to monitor and report on these requirements. In such a case, it is perhaps best to privatise the process – do not wait for government to appoint a veterinarian to complete the process, instead, acquire the expertise privately to complete the process with government oversight. We can do it, we just need approval, and once we have these approvals, we need to vaccinate all flock and cattle.

While there are certainly many impediments to our growth, one of the greatest boons to the industry would also be a welcomed societal improvement: updated, working infrastructure. Consider that working infrastructure can make or break a farmer. Larger, integrated producers have had the time and capital to develop their water treatment facilities or power generation stations. But they spend this money on their own survival – small farmers and emerging farmers don’t survive without these basic utilities; no one is starting new factories, or new farms, or opening new abattoirs, the operational expenditure is too high if 100% of utility generation and management is included in the bill. In many cases, we don’t have to build new lines, we just have to maintain what we have.

Finally, crime. No, not sweeping industry investments, not food subsidies or even increased grants – it is stronger law enforcement that will have a prolific effect on the industry and the economy. Crime is rife in farming communities; farmers are getting robbed blind. Greater visibility and enforcement, especially in these remote, vulnerable communities goes a long way in ensuring their survival and that of the value-chain. 

And while it’s easy to list these things in a quick conversation, we have to understand that implementation of these ideas isn’t necessarily as simple. But it’s certainly not beyond our reach, either; if the will exists, we can certainly achieve these ideals in the next five years.