Farming organisation Agri Western Cape says it’s concerned about the increased cost of fertilizers as the Russia-Ukraine conflict continues.
CEO of the organisation Jannie Strydom says this has resulted in increased production costs for farmers.
“A great concern is the cost of inputs in terms of fertilizer and also oil that will reflect in the fuel price. And we see the importance of fuel not only as an input to primary production but also in terms of Eskom and their diesel usage and with that we might perhaps see more load shedding and that is a great concern for agriculture in our province and as a whole.”
Western Cape Minister echoes same sentiments
Western Cape Agriculture Minister, Ivan Meyer, says the ongoing conflict between Russia and Ukraine is having an adverse effect on the farming industry in the province.
W Cape Agriculture working to mitigate the price impact on SA’s agricultural sector:
He says an increase in the oil price and a shortage of fertilizer, which have resulted from the conflict, will lead to an increase in production costs for farmers.
Meyer says this will also lead to an increase in consumer prices.
“The immediate effect is the increase in the oil price, the shortages of fertilizer and the limitations on the importation of agricultural products from both Russia and Ukraine. The conflict will also put pressure on the input costs of agriculture and food inflation will rise. The Western Cape is the biggest agricultural export region in South Africa and I’m already in discussions to explore new export markets for Western Cape Agricultural products,” says Meyer.
A 30% jump in oil prices since Moscow sent troops and tanks into Ukraine has turbocharged the shares of energy producers.
South Africa will feel the impact of the Russia-Ukraine conflict on food prices, but it is also primed to benefit from it through maize exports, experts said on Tuesday.
With Ukraine’s ports closed and much of the Russian grain supply frozen by Western sanctions, there are fears tightening supplies will lead to shortages in importing countries.
South Africa, a net exporter of maize, another name for corn, imports about 40% of its wheat, but Agriculture Business Chamber Chief Economist Wandile Sihlobo said shortages were unlikely.
“In South Africa, the near-term impact of this war is through price transmission and not the limitation on the commodities’ availability,” Sihlobo said in a weekly note.