South Africa is a diverse agricultural economy made up of 40,000 commercial farms according to the recently published Census of Commercial Agriculture (CoCA) of 2017 Report. An agricultural powerhouse that feeds Africa, its economic health affects many other countries that rely on its agricultural produce from grains to meats.
The major types of farming activities in South Africa are Growing of cereals and other crops, Horticulture, Farming of animals, Mixed farming (growing of crops combined with farming of animals), and Agricultural services and fertiliser production. The CoCA 2017 revealed that Mixed Farming (growing of crops combined with farming of animals) is the most trending in South Africa. In 2007, there were 9 104 mixed farming operations, and in 2017, there they grew to 12 458.
Farm land ownership in Africa is a controversial matter that has sparked conversation in several countries’ parliaments, yet can be reduced to the willingness of those intending to own a farm having to just start from somewhere, scaling up production from communal to commercial. In South Africa, there is a silent revolution of black owned farming enterprises in the provinces, and many turning their homesteads into farms, producing crops and vegetables for the nearby towns and cities. There is progress, and that progress is creating an agriconomy of South Africa, to feed Africa.
In 2018, Agricultural exports reached a record level of $10.6-billion. South Africa has a market-oriented agricultural sector that is vastly diversified and includes the production of all the major grains with the exception of rice. South Africa’s grain industry, comprising barley, maize, oats, sorghum and wheat, is one of the largest agricultural industries in the country, contributing more than 30% to the total gross value of agricultural production (Export Gov, 2017).
South Africa is the 34th largest export economy in the world and the 47th most complex economy according to the Economic Complexity Index (ECI); the most diversified Agriconomy in Africa.
The country’s major export markets are the BRICS. South Africa has a good trade performance with BRICS and there are more trade opportunities to explore, most especially for oranges and wines, among other commodities. Overall, China is South Africa’s major trade partner but it is noteworthy that Brazil and India are becoming flourishing markets for South Africa’s wine. China applies high tariff rates to wool, while tariffs on oranges gaining access into India are also high. India and Brazil apply exorbitantly high tariff rates to South Africa’s wine.
The agricultural industry contributes around 5% of formal employment, relatively low compared to other parts of Africa, as well as providing work for casual labourers and contributing around 2.8% of GDP for the nation. However, due to the aridity of the land, only 13.5% can be used for crop production, and only 3% is considered high potential land. The sector continues to face problems, with increased foreign competition and crime being two of the major challenges for the industry. The government has been accused of either putting in too much effort, or not enough effort, to tackle the problem of farm attacks as opposed to other forms of violent crime.
Maize production, which contributes to a 36% majority of the gross value of South Africa's field crops, has also experienced negative effects due to climate change. The estimated value of loss, which takes into consideration scenarios with and without the carbon dioxide fertilisation effect, ranges between tens and hundreds of millions of Rands.
According to FAOSTAT, South Africa is one of world's largest producers of: chicory roots (4th); grapefruit (4th); cereals (5th); green maize and maize (7th); castor oil seed (9th); pears (9th); sisal (10th); fibre crops (10th). In the first quarter of 2010, the agricultural sector earned export revenues for R10.1 billion and used R8.4 billion to pay for imported agricultural products, therefore earning a positive trade balance of R1.7 billion.
The Census (CoCA) 2017 and Key Findings
The survey aimed to provide financial, production, employment and related information for the commercial agriculture industry in South Africa. CoCA 2017 covered enterprises registered for value added tax (VAT) and which are mainly or primarily engaged in the following activities classified according to the January 1993 edition of the Standard Industrial Classification of all Economic Activities (SIC), Fifth edition. The classifications include Growing of crops, market gardening and horticulture (SIC 111), Farming of animals (SIC 112), a combination of the above (mixed farming) (SIC 113), Agricultural and animal husbandry services, except veterinary activities (SIC 114), and Game propagation, including related services (SIC 1151).
The following categories of data items were collected: general information, land use, field crops, horticultural crops, animals, employment, income, expenditure and details of purchases. The questionnaires were completed for the financial year ended on any date between 1 March 2017 and 28 February 2018,
The following are the key findings Census of Commercial Agriculture of 2017 Report;
The total number of farms/ farming units involved in the commercial agriculture industry in 2017 was 40 122.
The largest proportion of farms was in farming of animals (13 639 farms or 33,9% of the total), followed by mixed farming (12 458 or 31,1%) and growing of cereals and other crops (8 559 or 21,3%).
Between 2007 and 2017, the proportion of farms in mixed farming increased by 8,4 percentage points (from a percentage contribution of 22,7% in 2007 to 31,1% in 2017).
The proportion of farms growing cereals and other crops lost 13,0 percentage points over the same period (from a percentage contribution of 34,3% in 2007 to 21,3% in 2017).
The province with the highest number of farms in 2017 was Free State (7 951 farms or 19,8% of the national total), followed by Western Cape (6 937 or 17,3%), North West (4 920 or 12,3%) and Northern Cape (4 829 or 12,0%). The provinces with the lowest number of farms in 2017 were Gauteng (2 291 or 5,7%), Mpumalanga (2 823 or 7,0%) and Limpopo (3 054 or 7,6%).
The proportions of farms found in each province were relatively stable between 2007 and 2017. In each year the two provinces with the most farms were Free State and Western Cape, and the three provinces with the fewest farms were Gauteng, Mpumalanga and Limpopo.
Total income for the commercial agriculture industry in 2017 was R332,8 billion, which was 288% higher than the R85,9 billion recorded for 2007. In 2017, the major contributor to total income was farming of animals (R120,8 billion or 36,2%), followed by mixed farming (R95,0 billion or 28,6%) and horticulture (R65,7 billion or 19,8%).
Comparing 2007 and 2017, the largest gain in percentage share of income was in horticulture (+2,4 percentage points, from 17,4% in 2007 to 19,8% in 2017). Over the same period, the largest loss in percentage share was in mixed farming (‑4,1 percentage points, from 32,7% to 28,6%).
The province contributing the most to total income in 2017 was Western Cape (R64,3 billion or 19,3%), followed by Free State (R46,9 billion or 14,1%), North West (R39,7 billion or 11,9%), Mpumalanga (R38,4 billion or 11,6%) and KwaZulu-Natal (R34,0 billion or 10,2%).
The provinces with the largest gains in the share of national income between 2007 and 2017 were Limpopo (+2,0 percentage points, from 7,4% to 9,4%), Gauteng (+1,9 percentage points, from 7,8% to 9,7%) and Eastern Cape (+1,5 percentage points, from 6,6% to 8,1%). Western Cape lost the biggest percentage share (-2,4 percentage points, from 21,7% to 19,3%).
The total number of persons employed in commercial agriculture as on 30 June 2018 was 757 628, down from 769 594 in 28 February 2007 (‑1,6%). In terms of employment, the major commercial agriculture activity in 2017 was horticulture (268 740 employees or 35,5% of the total), followed by mixed farming (185 863 or 24,5%) and farming of animals (162 116 or 21,4%).
There was a large drop in the percentage share of employment in mixed farming between 2007 and 2018 (‑10,3 percentage points, from 34,8% to 24,5%). There were gains in percentage share in growing of cereals and other crops (+4,7 percentage points) and farming of animals (+3,8 percentage points). Western Cape was by far the largest provincial employer in 2018 (186 997 employees or 24,7% of the national total), followed by Limpopo (97 478 or 12,9%) and KwaZulu-Natal (96 206 or 12,7%).
The provinces with the lowest number of commercial agriculture employees were Gauteng (36 517 or 4,8%) and North West (57 758 or 7,6%). Between 2007 and 2018, Western Cape lost the largest number of jobs (-17 516), followed by Mpumalanga (-13 572) and Free State (-10 329). This was offset by gains in the following provinces: Limpopo (+22 600 jobs), Gauteng (+12 003 jobs) and Eastern Cape (+6 314 jobs).
Harvest 2020, Covid19 and Food Security
In a press statement, the Minister of Agriculture, Land Reform and Rural Development, Ms Thoko Didiza, MP announced that South Africa will have sufficient staple grains supply in 2020/21 marketing year, which starts in May 2020 and ends in April 2021. The data released by the department this afternoon shows that this year’s summer grains harvest could amount to 17.5 million tonnes, which is a 31% increase from 2019 and the second biggest harvest in the history of this country. This is a testimony to the hard work and resilience of the South African farming community and investments made in the sector.
Amid the unprecedented uncertainty and our collective fight against the COVID-19 pandemic, we are assured of sufficient food supply for the country at reasonable price levels. South Africa’s agriculture will also continue to export agricultural commodities and products, which are crucial for in generating much needed foreign exchange. There will be over 2.5 million tonnes of maize (white and yellow maize combined) for exports in the period between May 2020 and April 2021.
Agricultural Development
Agricultural development is key to growth for this sector and the economy at large. Away from the conversation of land reform, there is need to convert the local communal farmer into a commercial farmer and this can happen through development initiatives that educate and equip with resources, the farmer to grow their land and livestock into an economic machine that becomes a formal contributor to the sector.
There are various development initiatives at national, provincial and community levels in South Africa, that are implemented via the national government and provincial governments, and via agency initiatives across the country. Some are private and some are public. One of them is the recently formed Agricultural Development Agency (AGDA).
The Agricultural Development Agency, launched during the three-day Africa Agri Tech Conference and Expo in Pretoria in February 2020, a landmark in the history of South Africa, now exists to bring together the various role players in the agricultural environment. The new organisation is a private business initiative that will work closely with government in all aspects of agriculture from skills transfer to the practical aspects of implement land reform.
The Future is Female in Farming
As is in many sectors, the future of farming in South Africa is actually female. There are many young women leaving the city to take up farming entrepreneurship in South Africa; Thoriso Rampedi being one of them.
Thoriso Rampedi, a 2017 graduate from the University of Pretoria, with a Bachelor of Science (BSc) in Property Studies that decided to leave the employment life and become a farmer. Rampedi Farming is a small enterprise, fully black female owned that has been in operation for over 10 years founded by Thoriso.
The farmer business comprises mainly of pig stock of various breeds (Large White, South African Landrace and Durroc) which is supplied a number of companies, abattoirs and individuals. The enterprise has recently started farming with Boer goats which are mainly taken to auctions. Rampedi Farming says they pride themselves in quality meat, customer service and affordable pricing.
Source: SA Stats, Daily Maverick, OEC, NAMC, AGBIZ
