Cape Town - Agriculture MEC Ivan Meyer has outlined steps to improve productivity and efficiency at the Port of Cape Town.
This comes after concerns about food security and agricultural trade in the Western Cape as the Ukraine/ Russia war drags on.
Meyer recently met Agri Western Cape, Vinpro, Wines of South Africa (WoSA), the fresh Produce Exporters’ Forum, Grain SA, the South African Table Grapes Industry, Citrus Growers’ Association, and the Wool Growers’ Association.
He said the Russian and Ukraine markets contributed to South Africa’s foreign income through exports of agricultural products, with a significant share of those products coming from the Western Cape.
Meyer said South Africa’s agricultural exports to Russia and Ukraine combined were valued at R4.1 billion in 2020.
“The horticultural products, oranges, pears, apples, mandarins, lemons, fresh grapes and wine containers holding two litres or less collectively, contributed a share of R3.4bn,” he said.
Meyer said about 88% of that value was attributable to the Western Cape, a dominant player in the horticultural sector.
Wesgro said it was still monitoring the situation and would be providing an update after its research had been completed.
Meyer said South Africa’s wheat and meslin imports from Russia and Ukraine were valued at R2.3bn in 2020, and the Western Cape absorbed about 28% of those imports in value terms.
He said statistics showed that about 70% to 80% of all wheat flour produced was used for bread baking, attracting an estimated annual consumer expenditure of R6.7bn in 2020.
“In the Western Cape, 76% of all bread consumed is white bread. Therefore, a limited supply of wheat in the global markets will impact the domestic markets, and the increase in the price of bread will be one of the signs indicating a limited supply of wheat,” Meyer said.
He said that would have a direct impact on food security and the poor.
“Disruption in shipping, production and security concerns already resulted in a 50% increase in the price of wheat,” Meyer said.
He said Russia was responsible for 14% of global fertiliser exports, while the inability to export and the increase in the oil price would largely affect fertiliser, fuel and agrochemical prices.
Meyer outlined that the Western Cape Department of Agriculture (WCDoA) would approach the Bureau for Food and Agricultural Policy to monitor the development of blockages in the Western Cape’s agricultural value chain, with consideration for our exports and imports.
He said that would assist the sector to develop an appropriate response to the negative impact the conflict had been having on the agricultural trade.
Meyer said that during the height of the pandemic the WCDoA closely monitored the province’s agricultural value chains. That approach would now be applied to the conflict.
“We are already engaging with the Department of Agriculture, Land Reform and Rural Development to ensure that a sector response plan is developed to support our producers in the short to medium term while constantly monitoring the conflict.”
WoSA spokesperson Maryna Calow said that at present the impact had been minimal, although it was aware of certain orders that had been cancelled since the start of the war.
She said it was important to note that SA exported 6.9 million litres of wine to Russia and about 300 000 litres to Ukraine last year.
Calow said every opportunity was important to the industry, especially after the lockdown bans.
“For now, I think the main concern lies in a longer-term war and the impact that the likely rise in cost in terms of commodities will have on the industry,” she said.
Calow said there had already been an increase in the cost of fuel and that would no doubt continue to increase as the war persisted.
“The impact of raised costs means higher prices, but the concern further stretches to affordability of what is essentially a luxury product. In addition to that, the war may well exacerbate the challenges that we have seen at our port in terms of container shortages, which is also a global problem,” she said.