Roadblock: deteriorating SA road compromise more than R7,1 bn worth of Agri produce
5 April 2022
On 5 April 2022, Agri SA briefed the media on the findings of its analysis of survey results from participants in the agricultural sector. The survey was initiated to determine the impact of deteriorating road infrastructure on the sector. The findings are dire, and point to the enormous cost of South Africa’s poor road maintenance for the proper functioning and growth of the sector.
The survey revealed that participating farmers relied on road transportation to move an average of 94% of their produce. On average, participants transported an estimated R23 million worth of agricultural produce by road in the last financial year for a combined total of more than R7,1 billion.
13% of the respondents relied on road transportation weekly while more than 87% relied on roads daily. This explains why 69% of the respondents had at some point attempted to fix affected roads themselves. The respondents on average incurred repair and other related costs of more the R200,000 per participant. While this may be affordable for the biggest sector players, it is untenable for South Africa’s small-scale farmers.
All but two respondents experienced operational challenges because of the state of our roads, with an estimated average of 16% in turnover losses during the last financial year.
The survey included participants from the five worst-affected provinces with 19% in horticulture, 30% in agronomy, and 51% in animal production.
The consequences of the challenges related to deteriorating roads are varied and costly for South Africa’s food producers. The costs incurred range from engine and trailer damage to shorter vehicle lifespan and accidents. The increased transport and maintenance costs ultimately affect the consumer, determining how much consumers pay, and how fresh they receive the produce.
All this constrains the potential of the sector to contribute to South Africa’s Gross Domestic Product and employment. The sector already contributes R128 billion to GDP, but this can be even higher. This potential is illustrated by the fact that it was one of the few sectors to increase employment in the latest Quarterly Labour Force Statistics. But this potential cannot be fulfilled without determined and urgent action to address the problem of transportation infrastructure.
Agri SA will therefore be sharing this data with the Presidency and the Investment and Infrastructure Office within the Presidency and calling on government to join with the sector in addressing these issue now.
This survey has demonstrated the resilience and dedication of farmers who have continued to outperform the broader economy despite immense challenges. Amid rising input costs, the nation’s food producers have persisted even at immense personal cost, but this is unsustainable. Agri SA therefore stands ready to cooperate with government to ensure that we give our farmers the best chance of success, and in the process ensure the future food security of South Africa.
Statement issued by Kulani Siweya, Chief Economist at Agri SA, 5 April 2022
