This is especially true with respect to agriculture, as there are questions and concerns around how the locking down of countries worldwide has impacted farmers and food supply.
While the value of South Africa’s exportable agricultural commodities to countries around the world declined 8,8% in 2019 to $9,8 billion (about R166 billion), the picture has improved somewhat in 2020 as a result of favourable weather conditions, which have helped farmers increase summer crop plantings, improving prospects for higher outputs.
After facing trying times in 2019 as a result of drought conditions, this will come as a relief to farmers who will thus be able to meet the demand of our trading partners in Asia and Europe.
The Chinese government has issued a mandate to import significantly higher volumes of agricultural products such as citrus, nuts and wines, among others, from Africa. This is to meet the evolving consumer demands in China and has the potential to help strengthen South Africa’s export position.
The lifting of the ban on meat products following the outbreak of foot-and-mouth disease, which has brought much pain to the sector by curtailing output, has now also allowed for South Africa’s meat products to move freely.
The agriculture sector in South Africa is heavily dependent on global markets, and most of what is produced here goes to markets in Asia and Europe.
These are regions that have been particularly hard hit by the novel coronavirus, and this is impacting people’s ability to spend and disrupting supply chains as governments restrict movement.
This is undoubtedly a concern for local farmers and agribusinesses. A potential slowdown in export demand would hurt an already pressured sector.
The situation would be exacerbated by what is expected to be a decline in the prices of exportable commodities. Farmers and farmworkers are also placing themselves at risk of contracting the disease.
It is critical for farmers and farmworkers to be supported in this regard, so that they can continue producing food and accessing the market in a way that is safe and without disruption.
Taking necessary safety measures is essential to ensure the continuation of food supply to limit the spread of infection among labourers. This also means considering the use of labour-saving practices.
Agricultural technologies are helping to combat some of the problems that have been intensified in the sector due to the impact of COVID-19. These digitalised solutions offer an opportunity to address issues with input and output, logistics and human contact.
Prior to the crisis, the use of digital technology was already prevalent throughout the agriculture sector. Farmers are increasingly adopting these solutions as they allow for farms’ field operations to be more insight-led and efficient.
The combination of digital technology, such as the Internet of Things with big data capabilities, is helping farms to become more productive.
Agricultural productivity is inherently unpredictable. The industry is sensitive to weather patterns or biological processes, which, if unfavourable, can impact growing conditions and crop production. But it is critical to produce crops of the right quality and quantity to achieve successful farming.
Technological systems, such as remote sensing, have made significant impact in this regard. With this application, farmers can gather data that enables them to monitor crops and identify problems ahead of time.
Further to that, the data can be recorded and arranged into a system so that farmers are able to make informed decisions around crops and future strategies for growing. This kind of information can also be used to justify support from financial institutions as it provides an independent view of the business that lenders and insurers can reference when considering financing solutions for the farmer.
E-platforms are helping farmers connect and manage farmworkers and tasks better, with potential to integrate operational functions with suppliers and external technicians. Supporting such activities with payment capabilities is a further outflow that is likely to be scaled to commercial levels in Africa.
As the uptake of agritech solutions continues to increase, Standard Bank has committed to preparing its farming clients for a digital future. The bank is investing in innovative solutions that will deliver enhanced data through remote sensing and digital agronomy.
This will allow farmers and their agronomists, whose role is to increase soil and crop productivity, to make better decisions in everyday farming life.
Standard Bank has also crafted innovative finance solutions for renewable energy installation and usage across agricultural value chains.
The uptake of these offerings in support of farmers and processors’ energy management has gained significant momentum and is likely to continue.
For more information on Standard Bank’s digital offerings for farmers, speak to your Standard Bank relationship manager who will put you in touch with the relevant individuals.