SA agribusiness confidence holds despite livestock, trade concerns

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Moreover, some noted the long-running challenges, such as poor service delivery by municipalities and slow progress in releasing government land to beneficiaries with title deeds to stimulate agricultural expansion, as limiting factors.

Despite the slight decline, the current level of the ACI implies that South African agribusinesses remain optimistic about business conditions in the country.

The favourable 2024-25 summer rains and improvements at the ports, which have enabled exports with minimal interruptions, are among the positives.

The winter crop season is also looking positive for the 2025-26 harvest. This survey was conducted during the last two weeks of August, covering agribusinesses operating in all agricultural subsectors nationwide.

Figure 1: Agbiz/IDC Agribusiness Confidence Index

Source: Agbiz Research, South African Weather Service

(Shaded areas indicate periods of drought in South Africa.)

Discussion of the subindices

The ACI comprises ten subindices; five of them declined in Q3 2025, while the rest improved mildly. Here is the detailed view of the subindices.

• The market share subindex fell by six points from the previous quarter to 59 in Q3 2025. Most respondents maintained an unchanged view, with improving conditions in crop allowing for improved business conditions.

• The employment subindex declined by 5 points to 50 points in Q3 2025. This mirrors the general employment conditions in the sector. For example, the number of farm jobs in South Africa declined by 3% to 906,000 in the second quarter. We observed a quarterly decline primarily in the livestock industry, certain field crops, and aquaculture.

• The capital investments subindex decreased by 8 points from Q2 to 67. The decline is somewhat surprising as the high-frequency data, such as tractor and combine harvester sales, have remained strong since the start of the year.

• The sub-index measuring export volumes fell by 17 points to 43 in Q3 2025. This reflects the lingering concerns about the global trade environment, particularly with the US. Still, the hard data continue to paint a comforting picture. For example, South Africa's agricultural exports totalled US$3.7bn in Q2, up 10% from the same period a year ago.

• The general agricultural conditions subindex fell by 13 points to 67 in Q3 2025. The decline highlights the challenge posed by animal diseases. Still, the current level remains in favourable territory, indicating the positive effects of the summer rains in the 2024/25 season and the excellent winter rains for the 2025-26 crops.

Positive view

• The turnover subindex confidence is up 20 points to 75 in Q3 2025. We observed a significant improvement, mainly in the summer and winter grain regions, as well as in agribusinesses within the financial services sector. Similarly, the net operating income subindex increased by 6 points to 71 in the third quarter of 2025.

• Surprisingly, the general economic conditions subindex improved by 8 points to 58 in the third quarter of 2025.

Changes in interpretation

• The subindices of the debtor provision for bad debt and financing costs are interpreted differently from the abovementioned indices. A decline is viewed as a favourable development, while an increase signals growing financial strain.

• In Q3 2025, the financing costs indices fell by 14 points to 71, reflecting the current environment of easing interest rates. However, the debtor provision for bad debt was unchanged from Q2 2025 at 50.

Overall, the ACI results for Q3 2025 show that the mood remains upbeat in the sector, although several challenges confront some subsectors.

What we take from these results is that the recovery of South Africa's farming sector will likely be uneven in 2025, with the livestock subsector under pressure, while other subsectors seem likely to grow.

Moreover, the dominance of geopolitical concerns in respondents' views illustrates the strong dependence of South Africa's agricultural sector on export markets and the need to diversify these markets. Brics, primarily China, India, Saudi Arabia, and South Africa, are among the key markets we should expand into.

Still, as we drive the diversification, we must work vigorously to retain the access we have in various markets in the EU, UK, Africa, Asia, the Middle-East and the Americas, amongst others.

Also important are the collaborative efforts between business and government on addressing the biosecurity issues in South Africa's agriculture, along with pushing for better management of the municipalities, and the release of the government-owned land to appropriately selected beneficiaries. This is key for long-term expansion in the sector.