SA agriculture faces volatile decade amid global trade shifts
South Africa’s agriculture sector stands at a crossroads, navigating mounting global uncertainty, domestic structural challenges, and intensifying climate pressures. The Bureau for Food and Agricultural Policy (BFAP) Baseline 2025–2034 report, released in August 2025, warns that the coming decade will test the sector’s resilience, even as export opportunities remain central to growth.
The report highlights that while agriculture has doubled in economic size since 1994, much of this expansion has been export-led – driven by high-value, labour-intensive commodities such as citrus, wine, nuts, and beef. However, volatile global trade conditions, recurring disease outbreaks, and local infrastructure weaknesses now threaten to erode these gains.
Fragile global outlook
BFAP’s economists caution that global markets have been reshaped by consecutive shocks: the COVID-19 pandemic, Russia’s invasion of Ukraine, energy price surges, and persistent inflation that led to steep interest rate hikes worldwide. Although the International Monetary Fund (IMF) projected 3.3% global growth for 2025 and 2026, this has since been revised down to 2.8% amid renewed uncertainty – largely tied to trade measures implemented by US President Donald Trump.
BFAP notes that Washington’s proposed “Reciprocal Tariffs”, which could raise import duties to levels last seen a century ago, are already causing turmoil in world markets. South Africa’s agricultural exports to the US – dominated by citrus, wine, fruit juice, and macadamia nuts – could face tariffs of up to 30%, undermining competitiveness and threatening a market worth US$407 million in 2024. While the US accounts for only around 4% of South Africa’s agricultural exports, BFAP stresses its strategic value and warns against complacency.
China’s announcement of plans to cut tariffs on African imports to zero offers some hope, but South African products still face steep barriers – up to 30% on blueberries and 11% on oranges. Broader market access and trade diversification, the report argues, will be vital to sustaining export growth.
Domestic headwinds
On the home front, the report paints a sobering picture. Despite the optimism that accompanied South Africa’s Government of National Unity (GNU) after the 2024 election, economic growth remains subdued. Power supply has improved, but GDP growth slowed to just 0.5% in 2024 and 0.1% in the first quarter of 2025. The BFAP Baseline attributes the weak performance to fragile investor confidence, infrastructure backlogs, and policy uncertainty within the coalition government.
For agriculture, these structural weaknesses – from failing municipal services and decaying transport networks to erratic energy and water supply – are squeezing profitability. Agro-processors increasingly rely on private security, generators, and backup infrastructure, eroding margins and limiting expansion.
Recovery after drought and disease
After two consecutive years of contraction, the sector is expected to rebound in 2025. Agricultural GDP is projected to grow by 5.5%, aided by improved weather in the summer rainfall regions and a strong horticultural performance. Yet the report warns that this recovery is fragile: real agricultural growth over the next decade will be moderate, with field crops facing tightening margins as global grain prices normalise.
The 2024 El Niño drought, which devastated grain and oilseed regions, and widespread livestock diseases, including foot-and-mouth disease (FMD), exposed the sector’s vulnerability. BFAP calls South Africa’s national animal health system “a critical prerequisite” for future export growth, noting that its current weaknesses continue to constrain market access and productivity. Strengthening biosecurity, the analysts conclude, must be a national priority.
Sectoral outlooks
The livestock industry – South Africa’s largest agricultural subsector – has demonstrated significant potential for inclusive growth. Poultry, pork, and beef exports have expanded over the past decade, while communal wool farmers have successfully entered global markets. But the 2025 FMD outbreak has again highlighted the cost of inadequate animal health management. BFAP warns that unless veterinary systems are stabilised, growth will remain “balanced on a knife’s edge”.
Field crops, meanwhile, are entering a cooling-off phase. Following record investment in high-tech equipment and seed technology between 2020 and 2022, margins are expected to tighten as prices decline. While productivity remains high – with maize and soybean yields growing faster than in most major exporting nations – new entrants, especially emerging black farmers, face steep barriers due to limited credit access and insufficient extension support.
The horticultural sector, by contrast, continues to expand. BFAP estimates that fruit and nut orchards have grown by 120,000 ha in the past decade, with export volumes projected to rise by a further 25% by 2034. However, the report warns that growth could trigger price pressure unless new markets and logistics capacity are secured. South Africa’s ports, already strained, need urgent upgrading, while irrigation scheme maintenance is falling behind – with water losses of up to 30% reported.
Unlocking land and water potential
A key theme of the 2025 Baseline is the need for inclusive agricultural transformation. BFAP outlines a framework linking different categories of farmers – from smallholders to large commercial operations – with specific value chains and tailored support services. Successful transformation, it argues, depends on targeted investment in infrastructure, access to finance, and integration into viable markets.
The report identifies vast underutilised land that could boost production. Of the 1.8 million hectares of state-acquired farms assessed under the Proactive Land Acquisition Scheme (PLAS), less than 10% are productive. Roughly 230,000 hectares are suitable for field crops, 83,000 for horticulture, and over 1.5 million for livestock. Revitalising these assets could strengthen rural livelihoods and enhance food security.
Water infrastructure is another concern. South Africa’s irrigation systems are deteriorating, and wetlands are disappearing. Yet BFAP’s earlier research for the National Planning Commission showed that modest expansions in irrigation – around 140,000 hectares – could create up to one million jobs by 2030 if efficient water management systems are implemented.
A call for decisive action
While the baseline scenarios reflect a “business-as-usual” trajectory, BFAP concludes that the difference between stagnation and sustained growth will hinge on policy clarity, institutional reform, and strategic investment. “The world has become an increasingly unstable place,” the report states, “and this instability will continue over the coming decade.”
In this environment, BFAP urges government and industry to act decisively on low-hanging opportunities – from rehabilitating irrigation schemes and stabilising energy supply to fixing animal health systems and improving port logistics. These interventions, it argues, will not only boost competitiveness but also deliver lasting multiplier effects across the economy.
The report highlights that while agriculture has doubled in economic size since 1994, much of this expansion has been export-led – driven by high-value, labour-intensive commodities such as citrus, wine, nuts, and beef. However, volatile global trade conditions, recurring disease outbreaks, and local infrastructure weaknesses now threaten to erode these gains.
Fragile global outlook
BFAP’s economists caution that global markets have been reshaped by consecutive shocks: the COVID-19 pandemic, Russia’s invasion of Ukraine, energy price surges, and persistent inflation that led to steep interest rate hikes worldwide. Although the International Monetary Fund (IMF) projected 3.3% global growth for 2025 and 2026, this has since been revised down to 2.8% amid renewed uncertainty – largely tied to trade measures implemented by US President Donald Trump.
BFAP notes that Washington’s proposed “Reciprocal Tariffs”, which could raise import duties to levels last seen a century ago, are already causing turmoil in world markets. South Africa’s agricultural exports to the US – dominated by citrus, wine, fruit juice, and macadamia nuts – could face tariffs of up to 30%, undermining competitiveness and threatening a market worth US$407 million in 2024. While the US accounts for only around 4% of South Africa’s agricultural exports, BFAP stresses its strategic value and warns against complacency.
China’s announcement of plans to cut tariffs on African imports to zero offers some hope, but South African products still face steep barriers – up to 30% on blueberries and 11% on oranges. Broader market access and trade diversification, the report argues, will be vital to sustaining export growth.
Domestic headwinds
On the home front, the report paints a sobering picture. Despite the optimism that accompanied South Africa’s Government of National Unity (GNU) after the 2024 election, economic growth remains subdued. Power supply has improved, but GDP growth slowed to just 0.5% in 2024 and 0.1% in the first quarter of 2025. The BFAP Baseline attributes the weak performance to fragile investor confidence, infrastructure backlogs, and policy uncertainty within the coalition government.
For agriculture, these structural weaknesses – from failing municipal services and decaying transport networks to erratic energy and water supply – are squeezing profitability. Agro-processors increasingly rely on private security, generators, and backup infrastructure, eroding margins and limiting expansion.
Recovery after drought and disease
After two consecutive years of contraction, the sector is expected to rebound in 2025. Agricultural GDP is projected to grow by 5.5%, aided by improved weather in the summer rainfall regions and a strong horticultural performance. Yet the report warns that this recovery is fragile: real agricultural growth over the next decade will be moderate, with field crops facing tightening margins as global grain prices normalise.
The 2024 El Niño drought, which devastated grain and oilseed regions, and widespread livestock diseases, including foot-and-mouth disease (FMD), exposed the sector’s vulnerability. BFAP calls South Africa’s national animal health system “a critical prerequisite” for future export growth, noting that its current weaknesses continue to constrain market access and productivity. Strengthening biosecurity, the analysts conclude, must be a national priority.
Sectoral outlooks
The livestock industry – South Africa’s largest agricultural subsector – has demonstrated significant potential for inclusive growth. Poultry, pork, and beef exports have expanded over the past decade, while communal wool farmers have successfully entered global markets. But the 2025 FMD outbreak has again highlighted the cost of inadequate animal health management. BFAP warns that unless veterinary systems are stabilised, growth will remain “balanced on a knife’s edge”.
Field crops, meanwhile, are entering a cooling-off phase. Following record investment in high-tech equipment and seed technology between 2020 and 2022, margins are expected to tighten as prices decline. While productivity remains high – with maize and soybean yields growing faster than in most major exporting nations – new entrants, especially emerging black farmers, face steep barriers due to limited credit access and insufficient extension support.
The horticultural sector, by contrast, continues to expand. BFAP estimates that fruit and nut orchards have grown by 120,000 ha in the past decade, with export volumes projected to rise by a further 25% by 2034. However, the report warns that growth could trigger price pressure unless new markets and logistics capacity are secured. South Africa’s ports, already strained, need urgent upgrading, while irrigation scheme maintenance is falling behind – with water losses of up to 30% reported.
Unlocking land and water potential
A key theme of the 2025 Baseline is the need for inclusive agricultural transformation. BFAP outlines a framework linking different categories of farmers – from smallholders to large commercial operations – with specific value chains and tailored support services. Successful transformation, it argues, depends on targeted investment in infrastructure, access to finance, and integration into viable markets.
The report identifies vast underutilised land that could boost production. Of the 1.8 million hectares of state-acquired farms assessed under the Proactive Land Acquisition Scheme (PLAS), less than 10% are productive. Roughly 230,000 hectares are suitable for field crops, 83,000 for horticulture, and over 1.5 million for livestock. Revitalising these assets could strengthen rural livelihoods and enhance food security.
Water infrastructure is another concern. South Africa’s irrigation systems are deteriorating, and wetlands are disappearing. Yet BFAP’s earlier research for the National Planning Commission showed that modest expansions in irrigation – around 140,000 hectares – could create up to one million jobs by 2030 if efficient water management systems are implemented.
A call for decisive action
While the baseline scenarios reflect a “business-as-usual” trajectory, BFAP concludes that the difference between stagnation and sustained growth will hinge on policy clarity, institutional reform, and strategic investment. “The world has become an increasingly unstable place,” the report states, “and this instability will continue over the coming decade.”
In this environment, BFAP urges government and industry to act decisively on low-hanging opportunities – from rehabilitating irrigation schemes and stabilising energy supply to fixing animal health systems and improving port logistics. These interventions, it argues, will not only boost competitiveness but also deliver lasting multiplier effects across the economy.
