Fewer farmers are producing more food on larger tracts of land, fuelling the perception that only the biggest operations will survive. Yet, beneath this trend lies a more nuanced reality. While pressure on mid-sized farms is real, their future is not sealed, and many are finding ways to remain viable in an increasingly complex and volatile agricultural environment.
Data certainly points to consolidation. Corné Louw, head of applied economics and member services at Grain SA, says that while production area and national yields have increased over time, farmer numbers have steadily declined.
In 2008, around 9 200 farmers planted maize on 2,8 million hectares. By 2019, this dropped to 3 800 farmers on 2,3 million hectares, and in 2025, just 3 400 farmers planted nearly 2,6 million hectares. Over the same period, the average farm size grew from 302ha to 759ha.
However, interpreting the trend across industries is not straightforward. Kandas Cloete, senior analyst at the Bureau for Food and Agricultural Policy, explains that patterns differ across sectors. In the fruit industry, for example, production units are becoming larger, but not necessarily under single ownership.
“There are companies being formed, often with multiple farms and producer codes, which makes it difficult to determine how many individual farmers or landowners there are,” she notes.
Cloete’s research paper, ‘Investigating farm-level exit decisions and exit rates in commercial agriculture in South Africa, an agent-based approach’, published in 2022, highlights a range of pressures influencing farmers’ ability to remain in the sector, including retirement without succession, financial strain, labour challenges, policy uncertainty, and concerns about rural safety.
These structural issues have, however, been compounded by a far more volatile operating environment in recent years. “The issues are still the same as they were in 2022, but the environment has become increasingly volatile.
External shocks, from COVID-19 and global logistics disruptions to local port disruptions, fertiliser price spikes linked to the war in Ukraine and now Iran, and shifting energy costs in Europe, have added layers of uncertainty.
“In export-dependent sectors such as citrus, fluctuating profitability between seasons means that a single difficult year can push a farmer out of business. The situation is especially exacerbated in smaller operations, since their overdrafts are understandably smaller. So, their ability to remain afloat from one difficult season to another is more challenging,” says Cloete.
That scale plays a role in profitability is undeniable. Cloete explains that since the cost of technology continues to rise, farmers require sufficient hectares to justify these investments and remain competitive, especially as long-term price pressure persists.
Despite these challenges, Cloete stresses that mid-sized farms are not inherently unviable.
“There are mid-sized farms that remain competitive. They are efficient enough in what they do to compete in an environment where scale often dominates.”
Louw agrees, pushing back against the notion of the inevitable demise of mid-sized farms.
“The argument is that the middle farmer is not making it, but I don’t think that is entirely true. Often it is the farmer with better, more detailed management who gains the edge. The middle is under pressure, but it is not disappearing.”
The best jockey wins, regardless of size
While consolidation continues, Louw and Cloete believe that it is the quality of management and decision-making that separates those who survive from those who fall away.
“It is the best farmers that are surviving, rather than the biggest,” says Louw, adding that South African farmers have a strong tendency to persevere under pressure.
Although scale has become more important, it is not without its trade-offs. Larger operations benefit from volume buying and stronger negotiating power when selling, but as businesses grow, some of the finer management practices required for profitability can be lost.
Smaller and mid-sized farms, by contrast, are often better positioned to focus on detail and precision, which can give them an edge.
This raises an important question around how scale is achieved.
“Is it just scale that will make us survive, or are there other ways to achieve it?” Louw asks.
One solution, he relates, lies in collaboration, where farmers pool resources through buying groups, like the traditional co-operative model, to unlock efficiencies without necessarily expanding their land base.
“Farmers should be rethinking their business models, weighing up options such as diversification, specialisation, and vertical growth. In many cases, growth does not mean more hectares, but rather expanding the business along the value chain,” says Louw.
In the export fruit sector, this approach is often essential. “Larger operations often unlock additional efficiency gains in the value chain,” says Cloete, pointing to the importance of vertical integration through owning packhouses, having shares in export companies and being able to access retail programmes.
Productivity gains are equally critical. In the table grape industry, Cloete notes that yields increased from 3 260 cartons per hectare in the 2014/15 season to 4 050 cartons per hectare in 2024/25, a 24% improvement, highlighting how value per hectare is becoming a key determinant of sustainability.
Beyond structure and scale, however, the human element remains decisive. “Mid-sized farms are typically owner-managed, with the farmer directly responsible for multiple aspects of the operation. This creates a level of accountability and drive that is difficult to replicate in larger businesses with layered management.
“There is a different drive in an owner than in a manager because of the risk involved and his ‘why’. His ‘why’ is what drives him to be better. The manager is passionate, but working for a salary. As an owner you double down on the effort to make it to the next year and to grow,” says Cloete.
It is this combination of hands-on management, personal investment and a clear sense of purpose that will give well-run mid-sized farms their competitive edge.
Aligning size with potential
Yolandi Marais, who heads Dunamus Agri Advisory, points to three areas that farmers should pay attention to in order to keep mid-sized operations viable: alignment of resources, access to expert advice, and costly ownership structures.
“For mid-sized farms, survival increasingly depends on how well resources are aligned with what the business can realistically sustain. Farmers in this segment need to be far more deliberate in how they assess and deploy what they have.”
Marais says the starting point is a clear evaluation of available resources, including land, water, labour and skills, and whether these are being used optimally.
“If resources are not aligned, then you are not getting the best return on investment. The middle farmer has very little room for inefficiency and must optimise every resource.”
This includes interrogating underutilised land, whether due to limited capital, inappropriate mechanisation, or gaps in knowledge, and finding ways to unlock its value, such as leasing it out if it cannot be farmed effectively.
Labour is another area where misalignment often occurs. Marais notes that many mid-sized farms carry more people than the business can sustain, particularly where extended family members are employed on the farm.
“The farm is often not big enough to support the whole family. Farmers may need to explore if there are any skills that can provide alternative income streams, like offering services such as administration, marketing, or accounting to neighbouring farms.”
Marais emphasises the importance of aligning the expectations of the farming family with what the operation can realistically deliver.
“Otherwise, every last cent is used to support the family, with nothing left over to reinvest or expand.”
Machinery and capital investment require similar scrutiny. Louw notes that larger farms can spread equipment costs across greater hectares, improving efficiency, while smaller operations often carry the same machinery burden without fully utilising it.
“The smaller farmer needs to think about how to optimise machinery, whether through sharing equipment or using contractors for certain functions.”
The same principle applies to input procurement and marketing, where scale gives larger producers a distinct advantage in negotiating prices. Louw says mid-sized farmers can counter this by forming buying groups or co-operative structures to strengthen their bargaining position.
Expansion decisions also require careful consideration. Marais cautions that growth at the wrong time, particularly when financed through debt, can place severe strain on cash flow.
“Ask whether you really need the expansion, how often the asset will be used, and whether it should be owned, part-owned or contracted in,” she says, adding that part-ownership models often prove difficult in practice. Instead, a mix of ownership and strategic outsourcing may offer more flexibility.
Don’t hesitate to call in experts
Access to reliable information and expert advice is another key differentiator between farms that survive and those that fall behind. While large operations often employ in-house specialists, mid-sized farmers are typically expected to fulfil multiple roles themselves.
Cloete says this lack of capacity can be a significant disadvantage.
“A medium-sized farmer has to do everything themselves, which takes away time to plan ahead, attend seminars or engage with new technologies.”
Marais stresses that bringing in external expertise should be seen as an investment rather than a cost.
“Getting in external knowledge is crucial. Farmers should budget for advice in areas like agronomy, soil health, and financial planning. Rather than avoiding consultants due to perceived expense, farmers must engage with them proactively. Get a quote, explain your budget, and be clear about the answers you are looking for.”
At the same time, she advises farmers to approach all advice critically, particularly when it is linked to product sales.
“We have excellent agronomists, but advice that comes with a sales pitch should be questioned. Don’t dismiss it, but get multiple opinions and extract the value. Simple steps, such as sending soil analysis results to several fertiliser reps for comparison, can provide valuable insights at minimal cost.”
Farmers are also encouraged to tap into underutilised public resources. Marais notes that provincial agricultural departments often have highly skilled technical advisers, but many farmers are unaware of their availability.
Existing professional relationships can also be leveraged more effectively. Marais points out that most farmers already collaborate with accountants, who can play a more strategic advisory role if engaged correctly.
“It pays to have someone who does more than just books, but can give good advice too.”
Finally, peer learning remains one of the most accessible and valuable sources of knowledge, yet is underutilised. Marais says farmers should actively engage with others in their region to benchmark performance and identify solutions.
Ineffective structures that erode value
Weak ownership and succession structures can quietly undermine the viability of mid-sized farms, particularly during periods of transition. Marais says losses often occur not only at death, but when ownership shifts or someone exits the business.
“In most mid-sized farms, one person is the owner, manager and entrepreneur. If there are no proper structures in place, the business is vulnerable when that person exits. While trusts and companies are often used to limit estate tax, they offer little protection if control and decision-making remain concentrated in a single individual.”
A key risk is the mismatch between asset value and income.
“The value of the business may be high, which increases taxes and life insurance costs, but the income is not always sufficient to carry those expenses,” says Marais.
This creates a situation where the cost of transferring ownership, whether through estate duty, capital gains tax, or insurance obligations, places severe financial strain on the business.
She warns that poorly planned succession can push farms onto a downward financial trajectory.
“You must be very wise in how you structure ownership and succession. If the costs of transfer are too high, the business may not be able to carry them, and in some cases, farmers are forced to sell.”
Despite the pressures that medium-sized farms face, Louw, Cloete and Marais reject the notion that these farms are inherently unviable.
“You can’t say the middle is doomed because it doesn’t have scale. Efficiency is paramount, regardless of size,” says Marais.
The pressure on the agricultural ‘middle’ is undeniable, but its decline is not inevitable. As the experiences of farmers and advisers show, survival hinges less on size and more on discipline, alignment, and strategic decision-making.
Those who are able to optimise resources, collaborate where scale is lacking, access the right expertise, and structure their businesses for continuity stand the best chance of remaining viable. In an increasingly polarised sector, it is not simply the biggest that endure, but those who are able to adapt with precision and intent.
For more information, email Yolandi Marais at [email protected].
