Agri GDP declines by 24.2 quarter on quarter
South Africa’s gross domestic product (GDP) growth rate declined by 2,2%, and the agriculture, forestry and fishing industry decreased by 24,2%, and contributed -0,7 of a percentage point to GDP growth. The South African rand strengthened against major currencies during the first quarter of 2018. The strong currency is negative for exports, as our products become less competitive in the world market.
Maize exports were not as expected, and maize prices were very low, contributing negatively to the GDP growth. Abundant maize stocks from last year and favourable weather conditions weighed on the maize price. Drought effects of the Western Cape led to decreased production in field crops, horticultural crops and viticulture, which contributed to the GDP declines. The lower production led to reduced exports of these crops.
Although livestock prices are high, the herd rebuilding process is underway which means there are fewer or reduced supplies or slaughter in the market. These are some of the factors that contributed to the declines in agricultural GDP.
Published on Friday, 8th June 2018 - 10:26