The Bureau for Food and Agricultural Policy’s (BFAP) Baseline 2026 Agricultural Outlook (the baseline), launched earlier this month, notes that the sector had entered this period from a comparatively strong position after several profitable years.
However, low commodity prices, high input costs, and rising weather risks have now created a ‘perfect storm’ for producers that could result in consolidation in the coming years.
In real terms, the gross production value of field crops is projected to be almost 22% lower by 2035 than the elevated average recorded between 2020 and 2025. However, it will still be 4% above the 2014 to 2019 average, the previous low-price cycle. Being associated with long-term average weather conditions, this presents an average outcome.
The immediate challenge is a combination of abundant global grain supplies and escalating production costs. Another record global harvest is expected in 2026, keeping downward pressure on prices, while disruptions linked to the conflict in the Middle East have sharply increased input costs. Between March and May 2026, diesel and urea prices rose 68% and 87%, respectively.
High domestic stocks could also compound the pressure. Lower-than-expected exports from South Africa’s bumper crop mean more stock is likely to be carried into the 2026/27 season. While this would provide a buffer should El Niño reduce the next crop, it could also delay any price recovery.
Commenting on the severity of the challenges facing farmers, Loffie Brandt, executive head of agribusiness at Absa Group, told Farmer’s Weekly that history has shown that South Africa’s farmers are resilient.
“The previous tougher years have served as a learning curve for farmers, forcing them to streamline and implement practices and technologies that increase resilience. It has also taught farmers to plan for difficult years, and those who do are those who survive the storms. But farms that are already under pressure will struggle to survive,” he said.
Of the biggest concerns facing farmers, Brandt said rising input costs and low commodity prices were placing immense pressure on the sector.
“As things currently stand, it is highly likely that the baseline’s prediction of flat growth will be realised.
“But there are also many factors that could change at any moment and which could send the growth curve either up or down. Most notably, any changes in global grain stocks or the situation in the Middle East could influence grain and input prices,” he explained.
BFAP expects maize and soya bean prices to remain near export parity, while wheat prices will continue to be supported by import parity pricing and the variable import tariff.
For summer crop producers, this means profitability will increasingly depend on decisions around crop mix, input allocation, yield potential, and marketing. Sunflower could play a particularly important risk-management role in drier areas.
Export opportunities for white maize could emerge if El Niño reduces production elsewhere in Southern Africa. However, South Africa could face greater competition from Zambia, where stocks have risen following strong harvests.
Oilseeds offer strongest growth prospects
The longer-term outlook points to oilseeds as one of the sector’s clearest opportunities. Soya beans and canola have already been the fastest-growing field crops during the recent profitable cycle, and further expansion in processing capacity is expected to support demand.
By 2035, crush volumes are projected to increase 37% for soya beans and 76% for canola, while sunflower crushing is expected to rise 20%. With domestic demand growing more slowly, much of the additional soya bean and canola processing will have to be supported by exports.
Overall production growth will increasingly need to come from productivity rather than land expansion. Cultivated area is expected to consolidate, particularly in the near term as high costs, weaker prices, and El Niño-related risks discourage planting.
Domestic demand offers limited scope for expansion because of weak economic growth. Feed demand has somewhat better prospects, with yellow maize and protein meal consumption projected to rise by 13% and 17%, respectively, by 2035. However, animal disease remains a constraint on livestock growth and, by extension, demand for feed crops.
BFAP also identifies bioenergy as a potential new market for surplus crops. With food and feed demand growing slowly, ethanol and biomass-based fuels could provide additional outlets for crops such as maize, sorghum, and sugar cane. Developing this market will, however, require policy support, including enabling the use of surplus food grains and providing sufficient certainty for investment.
Policy will determine how much growth is unlocked
BFAP argues that competitiveness up until 2050 will depend heavily on addressing constraints beyond the farm gate.
Priority interventions include commercially focused support for land reform beneficiaries; modernising legislation governing new breeding technologies to unlock efficiency and drought-tolerance gains; considering policies to enable a bioenergy industry; and investing in core infrastructure to reduce value chain costs and strengthen export competitiveness.
The outlook warns that the stakes extend beyond crop farmers. A less competitive field crop industry would also increase pressure on livestock industries that rely on competitively priced feed.
“The field crop sector is at a critical juncture, where prioritising the right actions can enable substantial growth and value addition to 2050, simultaneously improving export revenue and food security impacts,” the outlook notes.
