Agriculture sector expected to emerge unscathed by Omicron disruption, says Agbiz
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WHILE there was heightened uncertainty worldwide in the wake of the new Covid-19 variant, Omicron (B.1.1.529), the Agricultural Business Chamber (Agbiz) said this week that it did not foresee the new variant causing major changes in regulations and trading activity for much of the agricultural sector.
The chamber’s chief economist, Wandile Sihlobo, said agriculture had largely been classified as an essential industry and remained operational since the start of the pandemic.
“We will, nonetheless, monitor the potential impact of the travel bans and the general surge of the Covid-19 infections on the global supply chains. This is an important area for South Africa’s export-oriented agricultural sector,” Sihlobo said.
He said, despite these global factors and the ongoing pandemic-related uncertainty, South Africa’s agricultural sector had started the 2021/22 production season positively.
The country was in a full La Niña swing, which was evident from the frequent higher rainfall that South Africa had received since the beginning of October. Consequently, the soil moisture had improved considerably across the country. While that was the case, the western parts of the Free State, Eastern Cape and North West still required additional rain to enable planting. Last week, even regions of the Karoo received favourable rainfall, which would help improve the pastures and benefit the livestock in the province.
Farmers had started planting in October in the eastern regions of South Africa, and progress had been good thus far, he said. For example, more than 80 percent of the intended area for maize and soybeans in Mpumalanga had already been planted. Similarly, eastern Free State farmers have planted roughly 75 percent of the intended area for maize crops.
South African farmers intended to plant 4.34 million hectares of summer grains and oilseeds. This was up by 5 percent from the 2020/21 production season. This comprised maize, sunflower seed, soybeans, groundnuts, sorghum and dry beans.
A deep dive into the numbers showed a mixed picture, albeit broadly positive picture, with 2021/22 maize planting intentions at 2.73 million hectares, down by 1 percent y/y (but well above the 10-year average area of 2.53 million hectares). Sorghum area was also set to fall by 9 percent y/y to 45 000 hectares (well below the 10-year average of 52 237 hectares). The groundnuts area was set to decline by 4 percent from the 2020/21 production season to 37 000 hectares (lower than the 10-year average of 43 348 hectares). Meanwhile, sunflower seed, soybeans, and dry beans area plantings were set to increase by 16 percent, 12 percent and 14 percent from the 2020/21 production season to 555 800, 924 800, and 54 250 hectares, respectively.
Agbiz said the downside of a La Niña weather event was the heightened prospects of hail, which South African farmers should consistently monitor as this could damage summer crops, vegetables and the fruit industry.
BUSINESS REPORT ONLINE