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Daily Maverick
02-06-2025
- Business
- Daily Maverick
SA farm exports to US rise 19% in Q1, a green sprout amid frosty diplomacy
An important point that emerges from this data is that if the fictional 'white genocide' and land seizures of Trump's imagination were actually unfolding, then South African commercial farmers – who are mostly white – would not be in a position to grow their exports to markets such as the US. South Africa's agricultural exports to the US increased 19% in the first quarter (Q1) of this year compared with the same period in 2024, according to data from Trade Map, which was crunched by the Agricultural Business Chamber (Agbiz) and released on Monday. It is an interesting trend that highlights several important points against the backdrop of a frosty diplomatic landscape amid US President Donald Trump's false claims about a 'white genocide' and the ruthless persecution of white farmers, which was on full display during his recent White House meeting with South African President Cyril Ramaphosa. For starters, as South Africa faces the prospect of exclusion from the Africa Growth and Opportunity Act (Agoa) – which provides preferential treatment to the US market for eligible countries – it is clear that there is American demand for agricultural products grown or made here. Specifically, these products are mainly citrus, grapes, wine, and fruit juices – South African products that could surely grow in the massive US market. Some might see America as a fairly small market in the broader scheme of things, with the 19% year-on-year rise in Q1 only amounting to $202-million – 6% of all South African agricultural exports in that period, which grew 10% to $3.36-billion. But 6% is material: this slow-growth, high-unemployment economy needs to pluck any fruit it can – and this stuff is low-hanging. Americans love citrus and fruit juice, a point underscored by the fact that global prices for these products are heavily influenced by the New York-based OJ futures market. Another important point that emerges from this data is that if the fictional 'white genocide' and land seizures of Trump's imagination were actually unfolding, then South African commercial farmers – who are mostly white – would not be in a position to grow their exports to markets such as the US. What this means: South Africa's commercial agricultural sector is a budding rose among the thorns of this moribund economy. It needs continued access to markets such as the US to grow and create badly needed jobs and investment opportunities while bringing in export revenue to help support the rand. South African farmers can find other markets, but the US, as the world's largest economy, remains the big prize. This does not mean that South Africa's agricultural sector isn't facing a range of serious political, economic and environmental challenges. The Expropriation Act is a red flag for South Africa's commercial farmers and investors more widely. That there are still glaring disparities in ownership – with only about 25% of farmland now in the hands of black South Africans, according to Agbiz estimates – is largely a reflection of state failure and dithering, corruption and incompetence under the ANC. Still, even in the face of other challenges such as climate change, South Africa's agricultural sector is prospering, a narrative at odds with Trump's view that a Zimbabwe-style mass land grab is under way. Americans clearly want to drink South African wine and fruit juice, and farmers here can meet that demand. Instead, Trump's racist resentment threatens to reap a bitter harvest from what should be fields of hope. BM
Russia Today
05-03-2025
- Business
- Russia Today
South Africa sets exports record
South Africa's agricultural exports rose to record highs and reached $13.7 billion (R255.5bn) in 2024, marking an increase of 3% from the previous year. Despite this positive trend, the Agricultural Business Chamber (Agbiz) on Monday cautioned that the nation faces headwinds from escalating trade tensions, particularly between the US and China, a situation that could have ripple effects on South Africa's export market. The findings reveal a trade surplus of $6.2bn, albeit a slight decline of 2% from the prior year. This fluctuation in figures comes as economists warn of continued volatility in the rand, primarily driven by developments in the US and fluctuations in the US dollar. Prospects of relative strength in the rand loom as upcoming US tariff applications may be less severe than initially anticipated. South Africa's agricultural sector is increasingly pressured to diversify its market reliance, particularly with the US, given the tit-for-tat trade war that has erupted with China. In a provocative retaliation, China has responded to a 25% tariff imposed by the US, charged with neglecting the influx of fentanyl into US territory. Such geopolitical manoeuvring underlines the urgent need for South Africa to enhance logistical efficiency and maintain, if not expand, its market presence across the European Union (EU), Africa, Asia, the Middle East, and the Americas. Wandile Sihlobo, Agbiz chief economist, said if South Africa were excluded from the African Growth and Opportunity Act (Agoa), the country would face an average import duty of about 3% at the Most Favored Nations Rate. This underscores the fact that Agoamainly offers price competitiveness to the products South Africa exports to the US. 'The 3% tariff would advantage other competitors that access the US market duty-free as South Africa currently does under the Agoa. South Africa's agricultural exports to the US - mainly citrus, grapes, wine, and fruit juices - account for 6% which also includes exports to the Americas,' Sihlobo said. 'Still, this is not to minimize their value as few specific industries are primarily involved in these agricultural exports to the US. Since the start of Agoa, the percentage share of South Africa's agricultural exports to the US has remained at these levels.' South Africa is on short notice with the US as that country highlights that government has taken aggressive positions towards the US and its allies, including accusing Israel, and not Hamas, of genocide at the International Court of Justice, and reinvigorating its relations with Iran. According to Investec chief economist Annabel Bishop, markets also perceive a deterioration in the political relationship between SA and the US after the former recently removed aid support from South Africa, and concerns are growing over South Africa Agoa's free trade access into the US. According to Agbiz, the EU is South Africa's third-largest agricultural market in 2024, with a share of 19%. Citrus, grapes, wines, dates, avocados, pineapples, fruit juices, apples and pears, berries, apricots and cherries, nuts, and wool were amongst the top agricultural products South Africa exported to the EU in 2024. Sihlobo said the country needed to accelerate initiatives including investments in the port and rail infrastructure and improving roads in farming towns. 'South Africa must work hard to retain the existing markets in the EU, the African continent, Asia, the Middle East, and the Americas. This is even more important in the current climate, where US policymakers are increasingly discussing raising tariffs,' Sihlobo said. He added that the departments of trade, industry and competition, as well as international relations and cooperation, and agriculture, should lead the way for export expansion in the current export markets and the search for new export markets. Sihlobo said South Africa should expand market access to some key BRICS countries, such as China, India, Saudi Arabia, and Egypt. 'The BRICS grouping should emphasize the need for member countries to lower the import tariffs and address artificial phytosanitary barriers hindering deeper trade within this grouping,' he said. He also noted that other strategic export markets for South Africa's agricultural sector included South Korea, Japan, Vietnam, Taiwan, Mexico, the Philippines and Bangladesh. 'The private sector and the South African government share this ambition for export market expansion. In the current fragmented world, more resources and marketing must be used for this work,' he published by IOL
Russia Today
04-03-2025
- Business
- Russia Today
South African agricultural exports hit record high
South Africa's agricultural exports rose to record highs and reached $13.7 billion (R255.5bn) in 2024, marking an increase of 3% from the previous year. Despite this positive trend, the Agricultural Business Chamber (Agbiz) on Monday cautioned that the nation faces headwinds from escalating trade tensions, particularly between the US and China, a situation that could have ripple effects on South Africa's export market. The findings reveal a trade surplus of $6.2bn, albeit a slight decline of 2% from the prior year. This fluctuation in figures comes as economists warn of continued volatility in the rand, primarily driven by developments in the US and fluctuations in the US dollar. Prospects of relative strength in the rand loom as upcoming US tariff applications may be less severe than initially anticipated. South Africa's agricultural sector is increasingly pressured to diversify its market reliance, particularly with the US, given the tit-for-tat trade war that has erupted with China. In a provocative retaliation, China has responded to a 25% tariff imposed by the US, charged with neglecting the influx of fentanyl into US territory. Such geopolitical manoeuvring underlines the urgent need for South Africa to enhance logistical efficiency and maintain, if not expand, its market presence across the European Union (EU), Africa, Asia, the Middle East, and the Americas. Wandile Sihlobo, Agbiz chief economist, said if South Africa were excluded from the African Growth and Opportunity Act (Agoa), the country would face an average import duty of about 3% at the Most Favored Nations Rate. This underscores the fact that Agoamainly offers price competitiveness to the products South Africa exports to the US. 'The 3% tariff would advantage other competitors that access the US market duty-free as South Africa currently does under the Agoa. South Africa's agricultural exports to the US - mainly citrus, grapes, wine, and fruit juices - account for 6% which also includes exports to the Americas,' Sihlobo said. 'Still, this is not to minimize their value as few specific industries are primarily involved in these agricultural exports to the US. Since the start of Agoa, the percentage share of South Africa's agricultural exports to the US has remained at these levels.' South Africa is on short notice with the US as that country highlights that government has taken aggressive positions towards the US and its allies, including accusing Israel, and not Hamas, of genocide at the International Court of Justice, and reinvigorating its relations with Iran. According to Investec chief economist Annabel Bishop, markets also perceive a deterioration in the political relationship between SA and the US after the former recently removed aid support from South Africa, and concerns are growing over South Africa Agoa's free trade access into the US. According to Agbiz, the EU is South Africa's third-largest agricultural market in 2024, with a share of 19%. Citrus, grapes, wines, dates, avocados, pineapples, fruit juices, apples and pears, berries, apricots and cherries, nuts, and wool were amongst the top agricultural products South Africa exported to the EU in 2024. Sihlobo said the country needed to accelerate initiatives including investments in the port and rail infrastructure and improving roads in farming towns. 'South Africa must work hard to retain the existing markets in the EU, the African continent, Asia, the Middle East, and the Americas. This is even more important in the current climate, where US policymakers are increasingly discussing raising tariffs,' Sihlobo said. He added that the departments of trade, industry and competition, as well as international relations and cooperation, and agriculture, should lead the way for export expansion in the current export markets and the search for new export markets. Sihlobo said South Africa should expand market access to some key BRICS countries, such as China, India, Saudi Arabia, and Egypt. 'The BRICS grouping should emphasize the need for member countries to lower the import tariffs and address artificial phytosanitary barriers hindering deeper trade within this grouping,' he said. He also noted that other strategic export markets for South Africa's agricultural sector included South Korea, Japan, Vietnam, Taiwan, Mexico, the Philippines and Bangladesh. 'The private sector and the South African government share this ambition for export market expansion. In the current fragmented world, more resources and marketing must be used for this work,' he published by IOL
