Worrying blow for the agricultural sector
DESPITE recording positive growth year-on-year in the sugar cane and maize industries, the agricultural sector's economic growth took a major hit last year.
According to the 2023 fourth quarter (Q4) GDP figures released last week by StatsSA, agriculture recorded its first annual contraction since 2019, shrinking by 12.2% - the biggest annual fall in production since 1995.
The latest figures have sent shockwaves through the sector which, although anticipated a weak performance, has come out far worse than expected.
Speaking to the ZO on Tuesday, AgriSA chief economist Kulani Siweya said this is reflective of the tough year the sector faced, particularly the livestock and poultry industries.
"We initially thought the contraction would be mild but the 12.2% year-onyear decline in the sector is far worse than we had expected.
"It bears testament to the headwinds that the livestock and poultry industry faced in the year and just how severe animal diseases weighed on those particular sub-sectors,” said Siweya.
The livestock and poultry industry accounts for nearly half of the agricultural sector's value.
“So when it was hit by animal diseases like foot and mouth, avian influenza and African swine fever, it was quite intense especially when comparing to the field crops where harvest was fairly robust.
“Maize harvest was about 6% higher than the previous year and we saw sugar cane increasing by about 3% year-onyear,” he said.
This was, however, not enough to pull the agricultural sector out of the red.
Load-shedding, transportation and logistics, as well as high input costs were also contributing factors to the weak growth.
“It is concerning, especially if you consider the dryness we are facing, which is induced by the El Nino impact.
“We are worried and the GDP print does not bode well with us,” he said.
StatsSA reported that the agriculture, forestry and fishing industry decreased by 9.7% in Q4 of 2023, contributing -0.2 of a percentage point to GDP growth.