Following unfavourable weather conditions, weakened export numbers and an ever-increasing unemployment rate, confidence in South Africa’s agricultural sector has slumped for a sixth consecutive quarter.
Moreover, it’s the longest period it has trended below the neutral 50-point mark for nearly a decade.
According to the November Agbiz-IDC Agribusiness Confidence Index (ACI), a report published by the Agricultural Business Chamber of South Africa, crops and livestock in particular are suffering due to poor nationwide economic conditions.
The ongoing drought in certain areas of the country is also a major contributing factor to poor agricultural results.
According to the Chamber, “the decline in the ACI was mainly underpinned by net operating income, employment, the volume of exports, economic conditions, general agricultural conditions and debtor provision for bad debt sub-indices”.
It added that while South Africa’s policies toward agriculture remained unsatisfactory, especially insofar as water regulations and land reform was concerned, “unfavourable weather conditions and biosecurity are pressing matters that could constrain agricultural economic fortunes”.
The Chamber also warned that unless the country could turn around its economic woes, more of the same was expected for the agricultural sector in 2020. – Bjorn Vorster
