Agricultural Market Viewpoint with Wandile Sihlobo

At the end of April, we completed South Africa's 2024-25 marketing year for maize. This marketing year corresponds with the 2023-24 production season, which was challenged by the mid-summer drought and led to the 22% decline in South Africa’s maize harvest to 12,85 million tonnes.

The big help in that season came from the gains of the previous ones. For example, the season started with 2,40 million tonnes of opening/carryover stocks from the past season, ultimately boosting the available maize supplies in the country. This added to the harvest of 12,85 million tonnes. These overall maize supplies were against the domestic needs of 11,6 million tonnes, leaving the country with substantial maize for exports.

The available exports were of great help to the southern Africa region, which was severely hit by the drought. For example, Zimbabwe lost 60% of their maize crop, Zambia lost half of its crop, and other neighbouring countries experienced significant losses. This meant that there was increased reliance on South Africa.

Thankfully, South Africa was better placed to help export more maize. At the end of the 2024-25 marketing year in April 2025, South Africa had exported 2,2 million tonnes, substantially well above the long-term average levels. About 66% of these exports were white maize and 34% were yellow maize.

Several countries benefited from these exports, especially in southern Africa. But no country benefited more than Zimbabwe, which accounted for 57% of South Africa's maize exports between May 2024 and April 2025, or about 1.3 million tonnes of white and yellow maize.

South Africa was exporting to the southern African region, so it had to import to supplement supplies, mainly in the coastal areas. However, another factor behind the increase in imports was the price competitiveness of imports. South Africa ended the 2024-25 season with 938,116 tonnes of maize imports, which mainly originated in Argentina, Brazil, and the United States.

Still, when one accounts for these imports and exports of 2.2 million tonnes, it remains clear that South Africa was a net exporter of maize in the 2024-25 season. South Africa did not experience a massive decline in maize production as its neighbouring countries did, in part, because of the improved seed cultivars and arguably better farming methods.

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Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

We have been saying for some time that 2025 will be a recovery year for South Africa’s agriculture, mainly highlighting the gains in grains, soybeans, and horticulture yields. But I was particularly pleased on May 8, when I received a report from South Africa Wine (SA Wine) indicating that we will have an excellent harvest in 2025.

SA Wine and Vinpro forecasts South Africa’s wine grapes harvest to be 1.244 million tonnes, an 11% recovery from the exceptionally poor harvest in 2024. Importantly, the quality promises are also to be excellent.

With the harvest like this, our preoccupation for the coming months will continue to be the export markets and logistics.

Indeed, the US market has dominated the trade conversation in recent weeks. However, long before the Trump tariffs, the South African wine industry and the entire agricultural sector had been focused on expanding export markets beyond the existing ones.

South Africa’s agricultural sector is export-oriented, with exports reaching a record US$13,7 billion in 2024, up 3% from the previous year, according to data from Trade Map. This reflects both an increase in the volume of agricultural exports and higher prices of some products.

The top exported products by value include citrus, grapes, maize, apples and pears, wine, nuts, fruit juices, sugar, berries, dates, pineapples, avocados, wool, apricots and peaches, ciders, and beef.

The focus on broadening export markets becomes even more urgent as we continue to see better quality and volumes in wine and other agricultural product output. One of the primary areas we focus on is China, which has a large population and buying power. China accounts for 11% of global agricultural imports.

However, the South African agricultural sector, specifically the wine industry, faces some constraints. For example, we face tariffs of 14% in wine exports in China, while our competitors, such as Australia, face 0% duties as they have a trade agreement with China. We have been vocal about such issues for some time. Now, the environment is even more urgent and appropriate to open these new markets, as China also looks to increase its agricultural trade with South Africa.

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Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

On April 30, we had essential data on South Africa's agriculture. The Crop Estimates Committee (CEC) released its third production forecast for South Africa's 2024-25 summer crop production season.

There are seven more monthly estimates to come. But on the third estimate, we begin to have some comfort about the accuracy of the data.

At a time when we have been worrying about the excessive rains, there was predictably a lot more attention on these figures. Notably, the CEC slightly increased South Africa's 2024-25 summer crop production estimate by 0.05% from March 2025 to 18.01 million tonnes.

Indeed, this is a mild uptick, but it remains crucial at a time when some worried that we might see a downward revision of the crop due to the excessive rains. This estimate comprises yellow and white maize, sunflower seed, soybeans, groundnuts, sorghum, and dry beans.

In essence, this harvest estimate is 16% higher than the 2023-24 production season, representing a decent recovery from the drought season

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Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

We are beginning to be concerned about the impact of these excessive rains on agriculture, particularly summer grains and oilseed regions. The crop has matured in most areas, and some planted earlier are now ready to harvest. However, with these excessive rains, it may prove impossible to access the fields.

Since we had a late start to the season, roughly a month behind the typical schedule, some areas aren't harvest-ready yet. Still, there is a need for sunshine for crops to mature. The frequent rains and scant sunshine also mean there are areas where, for example, some soybeans may start to germinate – an awful thing if it happens.

Of course, we aren't changing our optimistic view about South Africa's 2024-25 summer crop season. We remain optimistic that this will be a recovery season for South Africa's agriculture. However, I am concerned about the crop's quality and the harvest's timing.

The Crop Estimates Committee places South Africa's 2024-25 summer grain and oilseeds production at 18,0 million tonnes, up 16% of the prior season's crop. This comprises maize, sunflower seed, soybeans, groundnuts, sorghum and dry beans.

I never thought one would say this, but we badly need sunshine in South African agriculture.

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Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

In political economy, there is something called "flooding the zone". Roughly explained, this is when a deluge of information takes people's attention away from what should be a priority. In South Africa's agriculture, we are fortunately not under such an attack through the flood of information. Still, we must continuously be vigilant and reflect thoughtfully on risks affecting the sector.

In recent weeks, the focus has primarily been on trade matters and the U.S. tariffs, understandably so, because the U.S. is a valuable market for South Africa's agriculture. The U.S. reciprocal tariffs are imposed when the citrus industry is at its export season; therefore, our focus on these issues should be paramount. Equally, concerns about the sustainability of the Government of National Unity and the fiscal problems that dominate the domestic conversation are warranted as these place a sharp spotlight on South Africa's political futures and the plight of economic renewal.

Yet still, we must not allow other important domestic issues affecting the sector to be drowned by political noise. One such area is the continuous effort to control animal diseases. South Africa has made enormous progress following challenging years of avian influenza, African swine fever, and foot and mouth disease. However, we continue to learn about the foot and mouth disease outbreaks in parts of KwaZulu-Natal and some lingering cases in the Eastern Cape. This means animal health should remain a priority for South African agricultural authorities and organized agriculture.

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Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

South Africa, the only African country that is a member of the G20, holds the

presidency of the grouping until the end of November 2025. During this time, it could help drive the African continent’s food security agenda.

For agriculture, South Africa has set four G20 priorities:

* the promotion of policies and investments that can lead to improved food and nutrition security

* empowering youth and women to participate in agrifood systems

* fostering innovation and the transfer of useful technologies in agriculture

industries

* building climate resilience for sustainable food production.

These priorities could benefit the African continent, especially as many other African countries have long struggled with food insecurity and low agricultural productivity.

Based on my work as an agricultural economist, I would argue that South Africa could make use of its G20 presidency to support other African countries in building food security and raising the productivity of their agricultural sector.

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Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

South Africa was not spared of the "Liberation Day" tariffs announced by US President Trump against various countries. South Africa will face tariffs between 10% and 31% in the US for all products. The specificity of by-products is not yet clear.

We know now that a baseline tariff of 10% will apply to imports from all countries. It remains unclear if there are differences in the remaining 21% (that makes up the rest of the 31%) duties levied against South Africa.

Under this environment, it is prudent to assume that South Africa will be out of the AGOA (the African Growth and Opportunity Act), which afforded us duty-free access to the US for a range of products, including the auto industry and agriculture.

We suspect there may be some differences product by product, but that will be clear as soon as the US authorities release more information. We know that the reciprocal tariffs will generally range from 10% to 60% (and to 31% in the case of South Africa). The exact levy will be based on what the White House Council of Economic Advisers thinks is the sum of tariffs and non-tariff barriers on US goods to a specific country.

Indeed, some products face higher tariffs in the South African market, but there are rebates through the International Administration Commission of South Africa (ITAC) to assist any country that requires relief. South Africa is arguably amongst the countries with the lowest tariffs, which some local stakeholders have previously argued was a policy mistake at the onset of South Africa rejoining the global economy after 1994, following years of isolation.

The details of how the various domestic industries engage with this will also be precise in the coming days and weeks. But what I must stress regarding agriculture is that the US accounted for 4% of the total US$13,7 billion in exports in 2024. While this may seem small, it is significant for specific industries, particularly citrus, grapes, wine, and fruit juices. Since the inception of AGOA, South Africa's share of agricultural exports to the US has remained at similar levels.

With a 31% tariff now, while South African agricultural competitors such as Brazil, Chile, and Australia will face only 10% of the tariff, we will surely face a competitiveness problem in the US market. And yes, the tariff is a tax on the US consumer, not South Africa. However, it affects South African products' penetration rate in these markets.

It may not be easy, and diverting products to other friendly markets will take time. Still, this should be the main preoccupation of the Department of Agriculture, assisted by the Department of Trade, Industry and Competition. The Middle East and Asia should be the primary focus for South Africa to build access, mainly in China, India, and Saudi Arabia.

Listen to the podcast for more insights.

Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

South Africa's agriculture is recovering after a challenging mid-summer drought that led to significant crop losses in the 2023-24 season. The Crop Estimates Committee (CEC) 's data released at the end of March 2025 paints an encouraging picture of this new season's summer crop production prospects.

For example, the 2024-25 summer grain and oilseeds production is forecast at 18,0 million tonnes, up 5% from the previous month's estimate and 16% of the prior season's crop. This comprises maize, sunflower seed, soybeans, groundnuts, sorghum and dry beans.

Listen to the podcast for more insights.

Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

We have a challenging year like this one where there remains discomfort about the Expropriation Act in some sections of South Africa and rising geopolitical tensions; we were pleasantly surprised to see rising optimism in South Africa’s agriculture.

The Agbiz/IDC Agribusiness Confidence Index (ACI) – a sentiment indicator in South Africa’s agriculture -- increased 11 points from Q4 2024 to 70 in Q1 2025. This is the third consecutive improvement, placing the ACI at its highest level since Q4 2021, a year of La Niña rainfall that boosted agricultural output.

The current level of the ACI implies that South African agribusinesses remain optimistic about business conditions in the country. This optimism is a result of a combination of factors, including La Niña rains that support the 2024-25 agricultural season, improvements in port efficiency that supported exports in 2024, and the progress in controlling animal diseases.

This survey was conducted in the third week of February, covering various agribusinesses operating in all agricultural subsectors across South Africa.

Listen to the podcast for more insights.

Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website

South Africa has the contradiction of being the leading agricultural exporter in Africa, while swelling number of households that is food insecure. Without proper policy engagement of this challenge, the sector face the risk of more waves of misconceptions about its export-driven growth drive while many South Africans are impoverished.

We believe that an accurate diagnosis of the problem and its underlying causes is critical to formulating a suitable policy response.

In February 2025, Statistics South Africa released the Food Security Report for 2019, 2022 and 2023 (COVID-19 affected the ability to collect data in 2020 and 2021 ). The report utilized data from the General Household Survey (GHS) for those years.

The report's most striking observation was that ‘the proportion of households in South Africa that experienced moderate to severe food insecurity was estimated at 15,8% in 2019, 16,2% in 2022, and 19,7% in 2023. Over this period, the proportion of households that experienced severe food insecurity was estimated to be 6,4%, 7,5%, and 8,0%, respectively’.

It is not the lack of supply of nutritious, high-quality food and safe food products, or prices that has caused the deteriorating food security. Access seems to be the fundamental challenge, especially for households with no regular income sources.

Therefore, addressing income poverty at the household level must be at the center of any strategy to deal with food insecurity. Clearly, this is not a challenge that can be resolved by the agricultural sector alone but through coordinated efforts to grow the South African economy, lift employment across various sectors and providing appropriate support to vulnerable households.

Listen to the podcast for more insights.

Richard Humphries and Sam Mkokeli produce this podcast. Wandile Sihlobo website