South Africa: Agriculture GDP outperforms after surging 15.8% in Q1 2025
South Africa's GDP remained lethargic with an expansion of 0.1% q/q seasonally adjusted (not annualised) but still mildly above market expectations of a contraction. However, agriculture continues to be on the mend following the drought-induced contraction of 8.7% year-on-year in 2024.
Agriculture GDP outperformed other sectors after surging by 15.8% quarter-on-quarter, seasonally adjusted, in Q1 of 2025, with the largest contribution to quarterly growth of 0.4 of a percentage point to the positive South Africa GDP growth.
This reflects a significant improvement in seasonal conditions that spurred field crops, horticulture, and animal subsectors, which underpinned the Q1 spud in agriculture growth.
Field crops rebound with bumper harvest
Activity in field crops was robust with the summer crop (maize, soybeans, sunflower, sorghum, groundnuts, and drybeans) harvest rebounding by 15.7% year-on-year to almost 18 million tonnes.
This is accompanied by relatively strong commodity values with average prices for South Africa's biggest staple crop, maize, up by 39% and 18% year-on-year, respectively year-on-year for white and yellow varieties in Q1 of 2025.
Sugar and horticulture post solid gains
An additional component of the field crops, sugar, is forecast to jump 7% year-on-year to 2.1 million tonnes. The horticulture industry also posted good gains with limited production disruptions due to the relatively higher dam levels for irrigation and sustained electricity.
This saw good harvests for citrus, table grapes, and vegetables. The wine industry reported an 11% year-on-year growth in wine grape harvest at 1.24m tonnes, according to Vinpro.
The livestock industry saw, on average, a 5% advance in meat prices and increased availability, with red meat slaughter (cattle and pigs) up 1.5% year-on-year in Q1 of 2025.
Agri exports climb despite global challenges
On the export front, quarterly agriculture exports as per Trade Map data rose by 10% year-on-year to a total value of $3.36bn underpinned by higher volumes and prices despite the challenging global environment.
The benign inflation and interest rate outlook following a 0.25% cut in May 2025, with a further reduction in the offing later in the year, bodes well for the rebound in consumer demand and expansion in the agriculture sector.
All rights reserved. © 2022. Bizcommunity.com Provided by SyndiGate Media Inc. (Syndigate.info).
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Khaleej Times
an hour ago
- Khaleej Times
AI expected to contribute over $96 billion to the UAE's GDP by 2031
Artificial Intelligence (AI) is expected to contribute over $96 billion to the UAE's GDP by 2031, with annual growth projected between 20-30 per cent, analysts say. According to PwC, AI is expected to account for 13.6 per cent of the UAE's GDP, the highest among GCC countries — compared to 12.4 per cent in Saudi Arabia and 8.2 per cent in the rest of the GCC. Ranked fifth globally in Stanford's Global AI Vibrancy Tool, the UAE has emerged as a global AI pioneer through a range of strategic initiatives. In 2017, the UAE launched its National AI Strategy 2031 to become a global leader in AI. The strategy targets enhanced productivity and cost reduction across sectors such as transportation, space, renewable energy, water, technology, education, environment, and healthcare — particularly in combating chronic and life-threatening diseases. To support AI's growth, the UAE has significantly invested in information and communication technology (ICT) and internet infrastructure, through public, private, and foreign direct investments (FDI). During US President Donald Trump's visit to Abu Dhabi in May 2025, G42, an AI holding company based in Abu Dhabi, announced a partnership with OpenAI, Nvidia, Cisco, SoftBank, and Oracle to develop Stargate UAE — a 5GW AI data centre campus. Phase one, with 200 MW capacity, is expected to be completed by 2026. Building such AI data centres is capital-intensive. For example, Nvidia's H100 GPUs cost around $30,000 each, and a hyperscale centre may need at least 10,000 GPUs, totaling $300 million. 'For context, OpenAI used approximately 20,000 GPUs to train GPT-4, while Meta and Microsoft each have centres with over 100,000 GPUs. These centres also consume vast amounts of energy — 100MW data centres consume electricity equivalent to 350,000–400,000 electric vehicles annually according to IEA estimates,' Mayed Al Rashdi, economics research manager at Emirates NBD, said in a note. Between 2020–2025, the UAE attracted $4.89 billion in greenfield ICT and internet infrastructure FDI, an increase of more than 60 per cent on the existing stock of FDI in the sector. In early 2025 alone, the UAE secured $220.6 million in data centre investments. In March 2025, Microsoft announced plans to build sovereign cloud and AI infrastructure in partnership with G42, supporting Abu Dhabi's 2025–2027 strategy to become the world's first AI-native government. This infrastructure will process over 11 million daily interactions among government entities, citizens, and businesses. Microsoft also acquired a $1.5 billion minority stake in G42 in 2024. The two largest greenfield FDI projects came from Swiss firms Acronis and Swiss GRC, each investing $246 million. Switzerland ranks second behind the US in total capital investment in digital infrastructure and ICT in the UAE ($2.86 billion across 20 projects). The UK follows with $466 million from three projects, India with $356 million from one project, and Germany with $245.8 million from one. The UAE has the highest number of data centres in the region — 35 — compared to Oman's 12 and Saudi Arabia's 11. Public cloud spending per employee stands at $228, the highest in the region according to data from BCG. Dubai hosts 18 of these centres, while Abu Dhabi has 16. Despite having fewer centres, Abu Dhabi leads in value, with $1.23 billion in data centre assets versus Dubai's $815 million. Currently, 11 new data centres worth $3 billion are under construction and expected to be completed by 2026. Additionally, six data centres are in the pre-execution phase, valued at $41 billion ($40 billion of which is for the G42 UAE–US AI Campus). The growth of data centres has been hindered by the US' AI Diffusion Rule which restricted the import of advanced chips such as Nvidia's H100 and H200. However, in May 2025, the Trump administration rescinded this rule, enabling the UAE to import up to 500,000 of Nvidia's most advanced chips annually. 'This reversal has reinvigorated the UAE's data centre expansion efforts and is expected to accelerate the country's AI infrastructure development moving forward,' Al Rashdi noted. Internationally, the UAE is the second-largest investor in ICT and internet infrastructure greenfield FDI ($70.6 billion), trailing the US ($283.9 billion). The UAE also leads in average capital expenditure per project at $2.35 billion across 30 projects, compared with the US's average of $378.6 million across 750 projects. G42 and Mubadala co-established the MGX Fund — a $100 billion vehicle for investing in global ICT, internet infrastructure, and semiconductors. MGX deployed $43.4 billion in partnership with Bpifrance, Mistral AI, and NVIDIA to build Europe's largest AI campus in France (1.4GW capacity). MGX is also involved in Stargate USA, a $500 billion mega project to build 20 AI data centres across the US, in partnership with Oracle, OpenAI, and SoftBank. MGX has been active in private deals, investing $6.6 billion in OpenAI at a $157 billion valuation in October 2024 — now nearly doubled to $300 billion. DAMAC Holding ranks fourth globally in ICT and internet infrastructure FDI, having invested over $20 billion in US data centres. Its first phase includes 500MW facilities across states like Texas, Arizona, Ohio, and others. DAMAC also invested $852 million across three cities in Saudi Arabia (Riyadh, Dammam, and King Abdullah Economic City) and is active in countries including Greece, Spain, Turkey, Malaysia, Indonesia, Jordan, and Ireland.
The National
an hour ago
- The National
Spending review is no immediate panacea for Britain's growth woes
A key theme of the UK spending review is raising government budgets in some areas and using those increases to boost economic growth. Defence will receive a major injection with British contractors set to cash in, driving skills and jobs and revitalising some of the worst-hit post-industrial regions. It all sounds exciting and eminently doable on paper but, moving away from the drumbeating, the picture is not as clear-cut as the one Chancellor Rachel Reeves paints. Indeed, it is nowhere near the rosy, easily achievable image she creates. Britain is to increase its military expenditure to 2.5 per cent of GDP by 2027 and then to 3 per cent in the lifetime of the next parliament. Those numbers are tiny and fall a long way short of the 5 per cent sought by the US and Nato. Given it is not remotely clear how even the 2.5 per cent will be met, which represents a lift of only 0.2 percentage points from the current level, it is hard see how Prime Minister Keir Starmer's 'ambition' of 3 per cent, let alone 5 per cent, will be met. As the Institute for Fiscal Studies makes clear, there are few avenues: spending less on public services or raising borrowing and tax revenues. Some funding is to be derived from cutting international aid but after that, attention will focus on savings elsewhere or borrowing and taxing more. Details of what Reeves has in mind are scant – they will be revealed in her autumn budget – but tax rises look the most likely option. They will be justified on the grounds of need and the argument is already being rehearsed. Gone is the old rhetoric of maintaining a deterrent. Instead, the language is of 'readying for war'. It is presented as a national crisis, a conflict when the usual caveats and restraints are abandoned in favour of all hands to the pump or rather, the wallet. Except they are not. The day before Reeves' set piece, the Labour activists' news website LabourList published a poll finding that one in four party members backed defence savings not increases. 'The poll, conducted by Survation, found that 26 per cent of readers who identified as members would want to see money earmarked for defence to be spent elsewhere, despite the government pledging to boost investment in the military in the coming years,' LabourList said. One Nottingham councillor, Steve Battlemuch, seemed to voice the reasoning of many when he said: 'I will watch the Chancellor's spending review with my fingers crossed that councils start to get a better deal, but I suspect the multinational defence industry will be the ones popping the Champagne corks when she sits down. 'They have more lobbyists than children and councils have, and they have the fear factor. In a world where fear beats hope we have an uphill battle to get money allocated to making things better locally.' He may well be right. Despite the talk of 2.5 per cent, it is small compared to how Britain once was. In 1955, the military accounted for 7.63 per cent of national income. The subsequent long-lasting 'peace dividend' saw that proportion of GDP scaled back and the money directed to other services. With that decline, though, came a commensurate decrease in weapons manufacturing – armaments suppliers disappeared and the sector heavily retrenched. Rebuilding will not occur overnight. It will be a slow process necessitating the planning and construction of factories and their attendant infrastructures and the sourcing of parts and materials, not to mention the development of skills. Into that breach is bound to step established major producers from the US and similarly friendly countries. Those overseas behemoths will be rubbing their hands, or as Battlemuch put it, 'popping the Champagne corks', at the prospects ahead, despite Starmer and Reeves promising to 'buy British'. It was that downsizing that saw Britain slash domestic defence shipbuilding capability, so the sector fell, effectively to just one shipyard at Barrow-in-Furness in Cumbria. It happens to be my hometown. Even there, the size of the workforce drastically diminished, as Ministry of Defence orders continued to slump. At one stage, with completion of the generation of Vanguard submarines, it was down to below 5,000, badly hitting the town's fortunes. More recently, the site, now part of BAE Systems, has been climbing and is back up to 12,000 workers with another 5,000 to be added in the years ahead. Under the Strategic Defence Review 2025 and proclaimed by Starmer, the plant will build 12 new attack nuclear submarines. Local Labour MP Michelle Scrogham said: 'This will safeguard jobs, provide huge opportunities for local people and be the driver for our local economy across south Cumbria.' BAE, however, has struggled to obtain the necessary approvals for expanding its production facility. On the employment front the situation is little better. A nuclear industries task force has been set up to help train the tens of thousands of workers needed across the upscaling of nuclear in defence as well as in civil energy programmes. On the defence side, the submarines will be built by BAE with their nuclear reactors hailing from Rolls-Royce. It too is doubling the size of its Raynesway site in Derby. Once launched, the vessels will be maintained by Babcock. John Howie, Babcock's chief corporate affairs officer, has said: 'The industry needs to recruit a lot just to stand still. We don't want to steal from each other.' Starmer and Reeves then, may be gung-ho and what they are promising will certainly be of economic advantage, not to mention security. But the great defence push will cost and it cannot be completed immediately. A healthy dose of realism is required before everyone gets too carried away.
Zawya
3 hours ago
- Zawya
Egypt pursues stronger agricultural investment across Africa
Egypt - Alaa Farouk, Minister of Agriculture and Land Reclamation, held a strategic meeting with a ministerial committee to explore ways of enhancing cooperation with African countries in the agricultural sector. The session included Sherif El-Gabaly, Chair of the African affairs committee in the House of Representatives; Hesham El-Hosary, Chair of the House agriculture and irrigation committee; Abdelsalam El-Gabaly, Chair of the Senate agriculture and irrigation committee; Abdelhamid Demerdash, Chairperson of the Agricultural Crops Export Council; as well as ministry leaders, experts, and investor representative Ahmed El-Sewedy. The discussions focused on mechanisms to boost Egyptian agricultural investments across African countries and strengthen bilateral cooperation in food production and agribusiness. Minister Farouk reaffirmed President Abdel Fattah Al-Sisi's directives to deepen Egypt's partnerships across the continent—particularly in agriculture—as a cornerstone of regional food security and economic integration. He stressed that these partnerships would be underpinned by joint ventures, integrated agro-industrial projects, and existing trade agreements. Farouk emphasised the importance of identifying practical methods and frameworks for collaboration, calling for greater engagement from the private sector, scientific institutions, and research bodies. He requested the committee to present alternative proposals and an implementation roadmap within two weeks, to be reviewed in coordination with scientific and international partners for subsequent feasibility and technical assessments. Highlighting Africa's potential, Farouk noted that many countries on the continent offer compelling opportunities for investment due to abundant land, water resources, and the capacity to cultivate a wide range of strategic and high-value crops. These comparative advantages, he said, make agricultural cooperation mutually beneficial. The meeting also explored the development of a replicable investment model for projects in selected African countries. Key criteria include political stability, transport infrastructure, land quality, water availability, and other agricultural enablers. An agreement was reached to prepare a clear and detailed study outlining a viable investment model, to be implemented through partnerships between government agencies, the private sector, and national banks. The model will target countries offering promising opportunities and investor-friendly environments. Farouk further noted that efforts are underway to ensure data accuracy and risk mitigation, using standardised criteria to guide decision-making. It was also agreed that business leaders and investors would be invited to take part in the model, with an open call for participation from all interested stakeholders. The minister concluded by stating that this meeting builds on ongoing coordination between the Ministry and Parliament's African Affairs Committee, aiming to scale up Egyptian investments and agricultural collaboration across the continent. Participants recommended forming a permanent committee to assess investment opportunities, composed of representatives from the African Affairs Committee, the House and Senate Agriculture Committees, the Ministry of Agriculture, and the private sector.
