Agbiz Urges SA to Find New Export Markets as Middle East Conflict Threatens Citrus Season

The Agricultural Business Chamber of South Africa (Agbiz) has warned that South Africa’s agricultural sector must urgently identify alternative export markets as the ongoing Middle East conflict threatens to disrupt trade flows ahead of the citrus export season.

Wandile Sihlobo , chief economist at Agbiz, said last week that uncertainty continues to cloud the outlook four weeks into the conflict.

The Challenge

Sihlobo stressed that exporters must work closely with key government departmentsincluding Agriculture, Trade and Industry, and International Relationsto assess risks and prioritise new markets capable of absorbing excess produce.

“For exporting businesses, this is a risk we have to take seriously and start planning for alternative export markets where conditions permit.”

The Timing

South Africa is approaching its citrus export season.

“The challenge for the current year includes not only ample domestic supplies but also a recovery in Brazilian output, which will intensify competition against South African products in various export markets.”

The same is true of other fruits and berries, whose export seasons are fast approaching.

The Market Exposure

The Middle East accounts for about 8% of South Africa’s agricultural exports.

“The challenge of accessing the Middle East, at a time when South American fruit produce is also recovering, suggests there may be increased competition, even in other markets where South Africa would ordinarily have increased its volumes during years of shortages in South America.”

The Solution

Sihlobo said the industry must lead the effort to outline markets where relationships already exist or are most likely to be established swiftly.

“The various economic analysts in South African Missions around the world can also do their part by assessing whether, in the regions they serve, there is a possibility of advancing South Africa’s agricultural exports in the near term.”

“Serving the South African business in times of such need is a key part of the country’s economic diplomacy. Assistance to businesses in these critical times is a key part of demonstrating that South Africa has an effective economic diplomacy policy.”

The Long-Term Lesson

Sihlobo said the Middle East conflict once again exposes the need for South Africa to increase its focus on export diversification.

“This entails opening as many new export markets as possible to broaden growth opportunities for domestic businesses and reduce the risks associated with overexposure to a small number of markets.”

He said South Africa’s long-standing ambition to expand agricultural production through underutilised government-owned land would also lead to a major increase in productionwhich cannot be economically sustainable without new export markets.

The Bottom Line

The Middle East accounts for 8% of SA’s agricultural exports. The conflict threatens that trade. The citrus season is approaching.

Agbiz says: find new markets now.

Not because the Middle East isn’t importantit is. But because relying on a few markets is a risk the sector can’t afford.