The outlooks for our many agricultural industries look mostly favourable. However, consistent themes throughout the forecasts for 2023 are rising input costs, failing local infrastructure, and high shipping costs.
Rolling blackouts are also a cause of great concern for agriculture sectors stakeholders, and many farmers are reportedly investing in solar power to keep their operations afloat.
According to the Bureau for Food and Agricultural Policy, food prices are expected to remain at elevated levels in early 2023, on the back of higher commodity prices and a weakening exchange rate.
From a global perspective, the general prediction is that the oil price will decrease. And while this is good news for producers, it is bad news for the global economy: the oil price is likely to go down on the expectation that demand will be curtailed as we enter a global recession.
The ongoing Russia-Ukraine war will also add to market volatility, as the longer the war continues, the larger the decline in Ukrainian grain crops. A shortage of global soya bean stocks may also become problematic, particularly in terms of livestock production, as we may see a further increase in soya bean prices.
Should the Southern Hemisphere produce bumper maize yields, however, we may see a gradual decline in feed prices as the maize price drops.
Despite these challenges, South Africa’s agriculture sector remains resilient, and it is with great excitement that we enter 2023.
From all of us here at Farmer’s Weekly, we wish our readers a wonderful and blessed New Year!
