While South Africa's agricultural export earnings reached a new record of $12.8 billion (R233bn) last year, up 4% from the previous year, this was primarily due to higher agricultural commodity prices, Agricultural Business Chamber (Agbiz) chief economist Wandile Sihlobo said yesterday.
He said the volumes of exports of some products declined slightly in line with production, but this was more than compensated for by reasonably higher prices in the world market, specifically in grains.
Maize, wine, grapes, citrus, berries, nuts, apples and pears, sugar, avocados and wool were some of the top exportable products in 2022. Notably, the exports were spread across various key markets.
Africa remained the leading market, accounting for 37% of South Africa's agricultural exports last year. Asia was the second-largest agricultural market, accounting for 27% of exports, followed by the EU, accounting for 19%.
The Americas region was the fourth largest, accounting for 7%, and the remaining 10% went to the rest of the world. The UK was one of the leading markets within the rest of the world category.
Exports to Africa and Asia included a reasonably large volume or value of maize, while exports to other regions were mainly fruit and wine, Sihlobo said.
Agbiz said the robust export earnings were achieved despite challenges in the local ports and key export markets.
“For example, at the start of 2022, logistical challenges in the Port of Cape Town disrupted the exports of table grapes and other deciduous fruits. Thankfully, the cooperation between Transnet and organised agriculture helped to minimise the constraints and opened up channels of communication that were critical for managing the flow of exports and attending to pressing problems,” it said.
Agbiz said the Port of Durban faced fewer challenges than the previous year, with citrus exporters facing a relatively better export season from a logistics perspective.
In the key export markets, such as China for wool and the EU for citrus, South Africa faced non-tariff barriers. China temporarily blocked South African wool in response to the outbreak of foot-and-mouth disease in South Africa. China is an important market for South African wool, accounting for just over 70% of the wool exports.
Similarly, the EU imposed protectionist measures on South African agriculture by changing its regulations on plant safety for citrus without notifying its trading partners within a reasonable time. This was a contentious issue, especially as South Africa had already put in place rigorous measures to control the false codling moth, a citrus pest, which the EU used as a pretext to restrict citrus imports from Africa.
South Africa's agricultural imports last year amounted to $7.3bn, up 6% from the previous year. The top imported products were rice, palm oil, wheat, poultry and whiskies. These products originated primarily from Asia, the EU, the UK and the Americas.
Considering this import value against the export value of $12.8bn, South Africa's agriculture realised a record trade surplus of $5.5bn.
Paul Makube, a senior agricultural economist at FNB Commercial, said after a relatively tough year with various challenges that impeded operations, agriculture showed signs of resilience and posted another year of strong exports last year.
“The export outlook still points to high demand for quality and affordable agricultural produce as the global economy recovers. With shipping costs on the decline, expectations are for a rebound in export volumes in the year ahead,” Makube said
He said further opening of new export markets and digitally enabled trade would have positive implications for the South African agriculture export sector and enable it to continue building on the extraordinarily strong foundations it had set in place, particularly in recent years.
Meanwhile, Naliya Stamper, East London Terminal manager, announced yesterday that the terminal had resumed the export and import of maize and wheat after nearly two years of the silo facility’s temporary closure due to a severe decline in volumes regionally.
BUSINESS REPORT