South Africa might be doing okay in sectors such as political stability and technology development, but the country is now facing a serious threat of food security. 2018 was in large parts sunny and dry throughout the nation. Not to mention El Nino-induced drought in 2015, which the country has never really recovered from.
Now South Africa’s agricultural industry body – AgriSA – is set to start approaching banks, agribusiness, and government institutions to lobby for financial aid to the tune of $220 million (3 billion rands). AgriSA, through its executive director Omri van Zyl, said the fund will go to farmers severely hit by the drought to help them keep their farming business operational. Otherwise, things will grind to a stop for many farmers across South Africa.
“We have basically reached a point now where we don’t have any more fat in the system. There is no buffer any more in the agricultural sector,” said van Zyl.
“We see this drought again as a national emergency because it is going to have an impact directly on consumer prices, it is going to have an impact on food affordability and it has an impact on the farmers on the land.”
According to a research report tabled by AgriSA, in 2018, there were 31,000 jobs and 7 billion rands ($510 million) in potential revenue lost in South Africa agricultural sector. That was attributed to the drought.
“The farmers didn’t get enough [income] to recuperate in 2016 so the grain sector is in a lot worse financial situation than it was. Our ability to absorb this current drought is under pressure,” added Jannie de Villiers, the head of producers body Grain SA, while addressing a section of local media.
Last week, the white maize prices in South Africa stood just shy a two-year peak. The estimates already being given for the 2018/2019 planting season shows farmers have already planted 95% of the yellow maize in the country. A crop mainly used as animal feed, while white maize plantation stood between 70%-80%, thus pushing the price even higher.