Drought and heatwave become farmers’ nightmare
THE SITUATION was worsening for farmers as the drought and heatwave prevail, leaving them totally dependent on rainfall to carry their reduced crop plantings through, the SA Agricultural Machinery Association (Saama) said yesterday.
It said tractor sales of 385 units in November were 20 percent down on the 482 units sold in the comparative period a year ago. Industry expectations for tractor sales in 2015 are now 12 percent down on last year. improving investment confidence and resultant stronger growth.
Annabel Bishop, the chief economist at Investec, said a change in the outlook by S&P could see some rand impact over the week as it was less expected. She said the rand was assisted with some immediate stability by the US interest rate being increasingly likely.
Peter Attard Montalto, an emerging market analyst at the London-based Nomura International, said S&P’s outlook revision was a bit of a surprise and reflected a change in view, albeit within the same framework.
He said originally, the subinvestment grade theme was always about institutional quality and political will to reform.
“That framework remains, but S&P now sees the risk that parastatals support puts greater a drag on the fiscus (on
Wynn Dedwith, the chairman of Saama, said: “Farmers with supplementary irrigation have got to the situation where rain is required to replace water in dams and rivers, which is running critically low in many areas. The current situation is going to have far-reaching consequences on the agricultural machinery and food production industries.”
Meanwhile, December temperatures reached a record in many parts of South Africa on balance sheet) as well as the fact that growth may surprise to the downside, and structural reforms are not occurring to boost it and improve business confidence.”
Colen Garrow,
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Lefika Sunday and near-record highs are forecast as a heatwave intensifies the country’s worst drought for 23 years.
Pretoria will probably reach 39 degrees Celsius, while the temperature in Johannesburg will climb to 36 degrees, Kgolofelo Mahlangu, a forecaster at the South African Weather Service, said.
South Africa is in the grip of its worst drought since 1992. – Wiseman Khuzwayo and Bloomberg Securities’ economist, said credit rating agencies had often attracted criticism and, in some instances, correctly so.
He said it was S&P in particular that was highly criticised by market participants for not anticipating the financial crisis, which caused the near implosion of the global economy in 2008.
Garrow said the other criticism was that rating agencies were remunerated by companies they were doing assessments on, and this could hardly be seen as being objective.
Subsequent downgraded assessments by any sovereign or corporate risk were, therefore, viewed suspiciously for many years.
“However, the global economy has moved on, and although its recovery has become patchy and uneven, credit rating agencies today provide some of the most objective risk assessments of countries.”