People need to be employed, and people need food. In our agricultural province, farming holds answers to both those needs – if barriers to realising the potential are lifted.
We have national and even world market leadership in several agricultural sectors and high growth potential in others, highly skilled and business-oriented farmers, mostly solid infrastructure, and a bounty of farmland under irrigation that is standing idle.
The contribution of primary agriculture to both the provincial and national economy is relatively small at just over 2%, but the sector is a significant employer, accounting for 90 000 direct jobs in the province (6.2% of employment), including 3 000 direct jobs in the Bay. This excludes the impact of agro-processing, retail and trade, transport and logistics on employment.
Agriculture is highly export-focused, accounting for 10% of the country’s foreign exchange earnings.
Citrus is SA’s biggest agricultural export and the Eastern Cape is a major player – the second largest citrus-producing province (25%) and the largest producer and exporter of lemons, mostly from the Sundays River valley as the country’s largest single production area.
The province is also the largest dairy producer, accounting for 30% of milk production, while we are the top wool-producing province, at 34%, equivalent to the Western Cape and Free State combined.
We are the mohair capital of the world, producing over half of global production, 95% destined for export and most moving through the Bay for processing and shipping.
Game farming is rising in importance, meeting increasing demand in Europe for sustainably ranched venison meat, and the Eastern Cape is fast becoming the country’s top hunting destination. Game farming presents great tourism spin-offs for the Bay as well as agro-tourism in surrounding areas.
Primary agriculture in the hinterland links into an urban supply chain with up- and down-stream economic impacts encompassing agricultural input purchasing (tractors, trucks, bakkies, equipment, feed, seed, fertiliser, for example) to output including agro-processing, retail, transport and the logistics of importing equipment and supplies and exporting agricultural products.
However, agriculture is not as well-integrated into the economy and supply chains of the Bay as is the automotive sector. This is a key area of opportunity for the metro to develop a hinterland strategy to strengthen the economic linkages and support both urban and rural employment growth.
When we talk about the need to diversify the Nelson Mandela Bay economy, we need to integrate the agricultural sector into the opportunities being explored.
For example, most of the equipment and technology purchased by farming operations comes from outside the metro, and many of these represent opportunities for local businesses to diversify or adapt existing offerings to service agriculture.
Commercial farming is increasingly high-tech – utilising technologies such as drones, thermal imaging, AI and automation to improve efficiency, productivity and environmental sustainability. Local businesses involved in software development and automation for manufacturing could well explore opportunities for adapting their solutions into the agricultural sector.
By the same token, when we talk about the need for technical skills to support a digital, technology-driven manufacturing future, the same conversation is needed around agriculture skills training and development.
Skills in engineering, automation, technology development and implementation – along with farm managers versed in agricultural technology – are in high demand in the sector, presenting an exciting alternative for students who might see their future in manufacturing only.
Logistics difficulties in getting produce to markets is a critical challenge, highlighted in an independent study released last week by the Citrus Growers Association which found that ports and rail inefficiencies cost the industry R5bn in earnings in 2024 alone. These include reduced shipping slots due to lines avoiding SA ports due to congestion, delays in ports and the need to truck produce to alternative ports, resulting in higher input costs, reduced prices due to not meeting overseas market timing, and increased waste.
The same challenges face other agricultural sectors, as well as key sectors such as automotive manufacturing.
Safety and security is another key challenge, especially the safety of trucks transporting produce via the Addo road.
Agriculture is a key beneficiary of the preferential, duty-free access to the US market under the Africa Growth and Opportunity Act (Agoa), which is now under threat, risking thousands of local jobs and billions in export revenue. We will need to work with government on negotiating trade policies and exploring alternative markets.
There is untapped potential lying in 30 000 ha of under-utilised farmland in the Eastern Cape, that could be brought into production if infrastructure development is completed.
More action from government is needed in releasing land and providing security of tenure and effective support to emerging farmers to unlock the potential of the agricultural economy to contribute to growth, employment and food security, and improve stability in the rural economy.
Organised agriculture and the private sector stand ready to assist in developing new farming enterprises. Farmers want to do business, and a lot of the needed infrastructure is in place, along with solid business cases.
Attracting private sector investment is key, but requires more investor-friendly policies, better access to finance and access to markets, and overall improvement in the business and farming enabling environment.
Despite the challenges, when we look at agriculture in the Eastern Cape, all we see is opportunity.
Hannes de Waal is chief executive of the Sundays River Citrus Company and a Board member of the Nelson Mandela Bay Business Chamber.
AgriEC chief executive Brent McNamara provided additional input to this article.