WANDILE SIHLOBO: How SA’s agricultural sector is performing 30 years into democracy

There are divergent views about the effectiveness and extent to which SA’s agricultural policies have been implemented. Regardless of how experts feel about the capacity of the state and the policy stance of the government since the dawn of democracy, the one undeniable fact is that the sector has grown tremendously, as illustrated in the accompanying graphic.

Data from the department of agriculture, land reform & rural development shows that domestic agricultural output in 2022/23 was twice as high as in 1993/94. Whether this growth has been inclusive and transformative is a question I will return to later in this piece. For now, it is important to emphasise the growth of the industry and the drivers of its expansion.

Significantly, this expansion was not driven by a few sectors but has been widespread; livestock, horticulture and field crops have all seen strong growth over this period. Production of some crops, most notably wheat and sorghum, has declined over time, but this has had a lot to do with changes in agroecological conditions and falling demand in the case of sorghum, not policy.

The higher production levels have mainly been underpinned by new production technologies, better farming skills, growing demand (locally and globally) and progressive trade policy. The private sector has played a major role in this progress.

I use the phrase “progressive trade policy” solely to highlight SA’s standing in global agriculture. According to data from Trade Map, the country was the world’s 32nd largest agricultural exporter in 2022, the only African country in the top 40 in value terms.

This was made possible by a range of trading agreements the SA government secured over the past decades, the most important ones being with African countries, Europe, the Americas and some Asian countries. The African continent and Europe now account for about two-thirds of SA’s agricultural exports, and Asia is now also an important market.

The agricultural subsectors that have contributed most to this progress in exports are horticulture (including wine) and grains. SA now exports roughly half of its agricultural products in value terms, reaching a record $12.8bn in 2022.

Food security

The increase in agricultural output is why SA is now ranked 59th out of 113 countries in the global food security index, making it the most food secure country in Sub-Saharan Africa. I recognise that boasting about this ranking when millions of South Africans go to bed hungry every day may ring hollow, as I pointed out after a few presentations where I cited these statistics.

However, it is essential to note that the lack of access to food that many South Africans face is due to the income poverty challenge rather than lack of availability due to low agricultural output, as is the case in other parts of Africa. In essence, we need to ensure that there is employment and that households have sufficient income to buy food.

The global food security index balances the four elements (affordability and availability, as well as quality and safety) to arrive at a rating that covers matters at a broad national level. On this measure SA produces enough food to fill the shelves of supermarkets with high-quality products, but still has a long way to go in addressing household food insecurity since many households cannot afford the food that is available to meet their nutritional needs. This is a topic for another day.

Transformation

Earlier in this article I noted that the consensus on agricultural growth is at variance with the diversity of sometimes polarising views on the extent to which this growth is sustainable, inclusive and transformative. The reality is the gains we’ve seen in agricultural production over the past two decades have not been equitably distributed across the agricultural industry. Specifically, growth has been mainly restricted to organised commercial agriculture, sometimes at the expense of a distinct but heterogeneous cohort of farmers.

As I argued in my recent book, A Country of Two Agricultures, “Nearly three decades after the dawn of democracy, SA has remained a country of ‘two agricultures’. On the one hand, we have a subsistence, primarily noncommercial and black farming segment; on the other, we have predominantly commercial and white farmers.”

The book adds that “the democratic government’s corrective policies and programmes to unify the sector and build an inclusive agricultural economy have suffered failures since 1994. The private sector has also not provided many successful partnership programmes to foster the inclusion of black farmers in commercial production at scale. It is no surprise that institutions such as the National Agricultural Marketing Council estimate that black farmers account for less than 10%, on average, of commercial agricultural production in SA.”

This lacklustre performance by black farmers in commercial agriculture cannot be blamed solely on historical legacies. “While this paints a bleak picture of transformation in the agricultural sector, what we can also not ignore is the anecdotal evidence pointing to a rise of black farmers in some corners of SA. We see this in field crops, horticulture and livestock in provinces such as Free State, Western Cape, Eastern Cape and other regions.”

Robust employment

Even with the adoption of technology that catalyses agricultural productivity improvements, employment in SA’s agriculture has remained robust. For example, there were about 922,000 people employed in the industry in 1994, according to data from Stats SA, including seasonal and permanent labour. While the share of seasonal and regular labour changed over time, broad employment conditions remained vibrant. In the third quarter of 2023 there were about 956,000 people working in primary agriculture, up 4% from 1994.

As SA moves forward let’s always be mindful of the progress that has been made in boosting our agricultural fortunes. And in the quest to grow and be more inclusive, be forever vigilant of the unintended consequences of the policies we seek to implement. Equally, we must never be complacent with the dualism we continue to see in SA’s agricultural sector. The task before us is how to keep growing the sector in a more inclusive and transformative manner.

I think this will need both the private sector (organised agriculture groups and agribusinesses) and the government to craft a common vision for the sector, with clear rules of engagement and monitoring systems. This can build on the work of the National Development Plan (specifically, chapter 6), the Agriculture & Agro-processing Master Plan, the Land Reform Agency (yet to be launched by the government), and other progressive programmes and policies.

• Sihlobo, chief economist at the Agricultural Business Chamber of SA and author of ‘A Country of Two Agricultures’, is senior fellow in Stellenbosch University’s department of agricultural economics.