Commentary by Paul Makube, Senior Agricultural Economist at FNB Agri-Business

The results of both the first and second quarter of 2021 agriculture export performance reflects the resilience of the sector despite the ongoing Covid-19 related challenges across the globe.

The agriculture sector was able to operate during the various lockdown periods due to it being considered an essential service. Weather also came to the party and allowed for an excellent agriculture season which saw record crops across most commodities with the grain and oilseed crop topping 17.07m tons which is almost 2% higher year-on-year.

Despite logistical challenges, the sector managed to move hefty quantity of produce to the rest of the world with the 2nd quarter of 2021 recording a trade surplus of US$1.5 million which is 40% ahead of the same period in 2020. The follows a 36% y/y spike in total agriculture exports in quarter two of 2021 at US$3.2 billion, bringing the total 1H2021 export value to US$6.1 billion which is 30% higher y/y.

Drilling down into agriculture export makeup, the major export commodity is citrus which saw volumes rising exponentially due to seasonal availability in 2Q2021 to 817,023 tons which is up 1.6% y/y according to the TradeMap data. This brought the 1H2021 total citrus exports to 852,964 tons, which is up 0.7% y/y. Strong demand on export markets due to the health benefits associated with citrus commodities in the wake of the Covid-19 global crisis underpinned the good export performance.

In value terms, 2Q2021 citrus export revenue reached US$626,585, which is 14.2% higher y/y while the 1H2021 cumulative total rose by 12.2% y/y to US$655,946. Of the top ten country destinations, Netherlands accounted for 20.6% and 19.8% of the total 2Q2021 and 1H2021 volumes respectively but both were still 14% down on the previous year.

Meanwhile,

  • The industry's body, the Citrus Growers Association (CGA) lately pegged its estimate of the country's citrus exports 155.3 million cartons (15kg cartons) in its which is still way above the 2020 volumes.
  • The cumulative total exports of grapefruit, lemons, and soft citrus for the year to week 30 of the export season have so far increased 15%, 1%, and 9% respectively year-on-year at 14.64m, 21.77m, and 16.01m cartons. In other fruits, apple exports are already 5% ahead of the 2020 levels at 23.54m cartons.

Data on the category other nuts, fresh or dried, whether or not shelled or peeled (excluding coconuts, Brazil nuts) showed a sharp increase of 414% q/q to 11,635 tons which is however still down by 10% y/y. This brought the total first half quantity shipped to 13,897 tons which is down by 10% y/y and further reflecting the tough trading environment and the subdued Chinese demand. China's share of the SA product was 41% in the 2nd quarter and 35% of the cumulative year to June 2021.

Also read: South African agricultural sector can reap rewards from alternative energy

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