Agriculture unlikely to rebound in 2020, expert says

Pounding rains, a week of soft soaking rain, flash floods, army helicopter rescues, homes swept away, two people dead – it was a dramatic week of weather South Africans hadn’t seen for a while … and dams are still in bad shape.

Rand Water’s latest figures (as of yesterday) showed there was still room for improvement despite the Lesotho Highlands Water Project reopening on December 4, with the Vaal Dam at 41.03%, Sterkfontein at 91.2%, Grootdraai at 107.2%, and Bloemhof at 68.6%.

On Friday, the department of water and sanitation noted national dam levels dropped from 57.6% to 56.1% last week, and on Sunday chief economist of the Agricultural Business Chamber Wandile Sihlobo predicted “another grim year ahead for a despondent SA agricultural sector”.

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“We’ve witnessed sustained despondency among farming businesses for some time,” he said on his blog, Agricultural Economics Today.

“The Agbiz/IDC agribusiness confidence index has remained below the neutral 50-point mark for six consecutive quarters, which implies that agribusinesses are downbeat about business conditions.

“This is the longest period of despondency in the sector since the financial crisis.”

Maize, soya bean and sunflower seed production were all down year-on-year by 10%, 24% and 21%, to 11.3 million tons, 1.2 million tons and 680,940 tons respectively, with the wine grape harvest down 2% from last year.

“Erratic weather” combined with foot-and-mouth disease in Limpopo and an unfavourable agricultural policy environment were the key drivers of the downbeat mood.

“As we start the new decade, we are likely to get off on a negative footing, with the aforementioned factors likely to prevail.

“This makes one wonder whether there will be a meaningful recovery from the current slump in 2020,” said Sihlobo.

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