The release of the country’s growth figures by Stats SA shows that the farming, fisheries and forestry sector has contracted 33% over the past two quarters. Agricultural economists said the sector’s decline indicates the need for government to support the industry. “Government has to take note of this. There has to be support in some way if the government’s aim is to reduce poverty in rural areas. Agriculture is one of our biggest natural assets and we are not supporting and protecting this asset,” said Prof André Jooste, head of the Department of Agricultural Economics at the University of the Free State.
Jooste said a combination of factors such as volatile market forces and climatic fluctuations caused a dip in the agricultural sector. “We must take into account that we’ve seen a contraction of maize production. This will be reflected in these figures,” he said. However, he said the sector has serious problems which have to e addressed urgently. “The government has to start thinking of how to support agriculture in a wider sense. If commercial farmers are struggling to survive, how will emerging farmers cope?” he said. Jooste said the agricultural sector will benefit from the implementation of a dual support system for both commercial and emerging farming. “It will affect development and food security in the
long run. Emerging farmers will become commercial and they will produce food in the next generation,” he said.
Commercial farming needs support as it provides employment.
Commercial farmers also have a role to play in mentorship and knowledge transfer to emerging farmers. “Commercial agriculture is a great job provider for low-skilled workers and skilled labour such as tractor drivers,” he said. According to Stats SA, the agricultural sector’s contribution to gross domestic product (GDP) is 2,4%. “This figure must be interpreted with high caution,” Jooste said. Studies show that agriculture is the strongest GDP and employment multiplier. “The industry has many knock-on benefits in the rural economy. It is dangerous to just look at agriculture in isolation,” he said. Dr Moraka Makhura, president of the Agricultural Economics Association of South Africa, said there is cause for concern if the agricultural sector isn’t growing. “Ultimately a decline in agricultural growth indicates a need to support the sector,” he said. Decline in the sector will also reduce economic growth in rural areas. “We can only hope this is a temporary occurrence. If it continues we will see job losses and problems with food security, as food shortages will cause prices to increase,” he said. Makhura said the statistics are also not representative of the entire agricultural sector. “We need to have a better counting of the contribution of emerging farmers to agriculture. }
This would make a big difference to the overall statistic,” he said. He said secondary agricultural activities should not be excluded when calculating the sector’s performance. “The sector doesn’t only consist of primary agriculture. It is not to say that if the sector’s share in the GDP is low that it is not important. ts significance in the overall economy may not be large, but it is still an important sector and it does drive the economy,” he said. – Wilma den Hartigh