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Preface

The impact of COVID-19

on the South African agricultural sector

By Prof Ferdi Meyer, managing director, Bureau for Food and Agricultural Policy

few months ago, if anybody infections in South Africa will still increase disruptions caused by lockdowns and
suggested the possibility considerably and are only expected to restrictions on the movement of goods.
of an international viral peak in September. This is mainly the case for specific food
pandemic during a typical items that are typically imported from
strat
A egic planning session of a Disruptions in the food system affected regions in the world market.
company, they would have been laughed It is apparent that government aims to On the export side, disruptions due to
out of the meeting room – and it would follow a flexible and responsive model logistical problems or restrictions on the
have been an actual room with people where restrictions on some economic movement of goods is having a negative
physically present. activities, especially those with a low economic impact on South African
On 27 March this year, the country went risk of transmission, will gradually be producers, agribusinesses and exporters.
into what was initially envisaged to be a relaxed. However, if there are signs that For example, in April there were significant
21-day lockdown period, which implied that infection rates are starting to accelerate delays with a number of cargo ships that
all South Africans had to stay home. This again, restrictions will be tightened. When were supposed to load citrus and other
lockdown period was eventually extended. that happens, disruptions in the food fruit for export.
In his address on 23 April, president system will not be caused by lockdown The record citrus crop is currently
Cyril Ramaphosa announced an approach restrictions, but rather by the closing of at its peak harvesting period and any
where the re-opening of the economy food processing plants and distribution bottlenecks in exports can cause major
would be managed based on five alert and retail facilities when abrupt localised financial loses, as agribusinesses will face
levels. The country moved to level 4 on outbreaks of COVID-19 occur. lower prices when products destined for
1 May, which brought some relief to the export are diverted into the local market.
agricultural sector through the resumption The most significant contributor to
of wine, wool and cotton exports. However, While supply chain logistics South Africa’s food import bill is highly
the drop in food consumption levels may, in the event of a prolonged processed, non-perishable products,
mainly due to the continued lockdown of outbreak, start to influence the which would typically include vegetable
fast food outlets and restaurants, is cause oils, sugar, coffee, tea and alcohol. While
for major concern. consistency of availability of supply chain logistics may, in the event of
these products to South Africa, a prolonged outbreak, start to influence
Dwindling demand global supply is not a concern. the consistency of availability of these
The impact of job losses and overall products to South Africa, global supply is
economic hardship still has to filter not a concern.
through the system and even if the country We have seen a number of these South Africa finds itself at a relatively
swiftly moves to level 3 or even level 2, disruptions in other parts of the world, early stage in the epidemiological cycle.
demand will remain weak for the third especially in meat processing plants in the There are widely differing views on the
and fourth quarters of 2020. Cold storage United States. appropriate balance between containing
space, especially for products such as the spread of the virus as far as possible
chicken and beef, is filling rapidly and the Effect on imports and exports to flatten the curve and improve the
first companies are hinting at cutting back Although global stock levels are generally readiness of the health system, versus the
on production levels. very high, food supply chains and food negative impact of lockdown restrictions
Consequently, the Bureau for Food and consumption patterns are already on economic activity.
Agricultural Policy has already reduced the affected. Overall, South Africa is a surplus Although we know that the world
projected feed demand figures for grains producer of food and the value of South economy will eventually recover, life as we
and oilseeds for 2020. Major uncertainty Africa’s food exports exceeds imports by know it will not be the same.
remains regarding the length and depth a significant margin. In terms of imports,
of COVID-19’s impact on the agricultural the world market is well stocked in all For enquiries, phone
sector, especially since current indications food items. Since mid March, any periodic Prof Ferdi Meyer on 012 420 4583
all point to the fact that coronavirus shortfalls largely occurred due to logistical or send an email to ferdi@bfap.co.za.

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June 2020