Bumper agricultural exports could exceed last year’s R140bn mark

SOUTH Africa’s agricultural exports could exceed 2020’s $10.2 billion (R140.2bn) this year as a result of the expected large production volumes of various crops and fruits and sound output in the wool industry, the Agricultural Business Chamber (Agbiz) said.

Agbiz chief economist Wandile Sihlobo said on Monday that the country’s agricultural imports increased marginally by 4 percent year-on-year to $1.6bn in the first quarter.

“The top imported products were the usual ones where domestic consumption usually outstrips domestic production. These include wheat, rice, palm oil, soybean oilcake/meal, beer from malt, poultry products, live cattle and whiskies. We believe rice, wheat, and palm oil will dominate the agricultural import product list for the year,” said Sihlobo.

Agbiz said the agricultural sector had a good start to 2021, with favourable rainfall supporting crop yields and grazing for the livestock industry.

Sihlobo said this was the second consecutive season of strong performance for the sector after 2020 saw bumper harvests and the second-largest export earnings on record of $10.2bn.

With 2021 set to present even larger yields than 2020 for major field crops, horticulture and the wine industry, Agbiz believed that exports could surpass last year’s levels.

“In the first quarter of 2021, agricultural exports amounted to $2.9bn, which is a 28 percent year-on-year increase. The size of the increase compared with last year is partly because of base effects, as the first quarter of 2020 was affected by the Covid-19 related disruptions to global supply chains, but the growth also reflects rising export performance for various products,” said Sihlobo.

The International Grains Council forecasts South Africa’s 2021 rice imports at 1.1 million tons, a 5 percent increase from the previous year. The imports are usually evenly spread across the year, with a peak in volumes in the last quarter of each year.

Meanwhile, South Africa’s 2020/21 wheat imports were forecast at 1.58 million tons, down 16 percent year-on-year.

Sihlobo said the organisation, however, expected a notable decline in soybean meal imports, as South Africa had a record harvest in the 2020/21 production season, which should substitute for a large share of the usual imports.

In the first quarter of this year, the top exportable products included fresh grapes, groundnut oil, maize, wine, greasy wool, fresh plums, fresh pears, fresh apples, and maize meal. The chamber expected these products to dominate the export list throughout the year, as the production promised to exceed last year’s levels.

Last month, the South African Wine Industry Information & Systems forecast the 2021 wine grape crop at 1.5 million tons, which was 9 percent larger than the 2020 harvest. This would likely contribute to increased wine exports this year.

The Citrus Growers’ Association recently projected that the South African citrus industry would probably break all previous export season records, with an estimated 159 million cartons in 2021, from 146 million cartons in 2020.

Moreover, South Africa could have 2.8 million tons of maize surplus available for export markets in the 2021/22 marketing year. This would be the largest volume since 1994/95, when South Africa exported 4.7 million tons of maize, according to data from the South African Grain Information Services.

The available maize export volumes were on the back of a large forecast harvest, which Agbiz forecast at 16.7 million tons against the Crop Estimates Committee’s 16.2 million tons. This would be the second-largest maize harvest on record.

– BUSINESS REPORT