The Report's View: While we hold a positive view on the South African agricultural sector and see particular growth in the livestock sector, we are less optimistic on sustained growth in cereals production. This will be due to slower yield growth owing to lower inp ut usage from a weaker currency and limited development in GMO seed plantings. The sugar sector also presents interesting growth opportunities, mainly thanks to renewed investment and improved technologies. The country's livestock sector will see greater growth over the coming years , owing to lower grain prices and increasing demand from a more affluent population. We believe the country's main a gribusiness companies will reap the benefit from lower global grain prices and therefore lower feed prices.

Key Forecasts

  • Sugar production growth 2012/13 to 2017/18: 31.2 % to 2. 65 mn tonnes. This is based on our view that macroeconomic fundamentals, together with the increasing use of sugar for biofuels and increasing global sugar prices will have a positive impact on sugar production levels over the long term.
  • Poultry consumption growth to 2018: 15.9 % to 2. 0 mn tonnes. As more South African consumers move towards diets containing higher levels of protein, poultry (predominantly chicken but also turkey and duck) is increasingly being viewed as a convenient, healthy and affordable source of nutrition.
  • Corn production growth 2013/14 to 2018/19 : -5.2 % to 14.0 mn tonnes. Growth will be constrained over the next few years as a result of slower yield growth.
  • Real GDP growth: 2 . 1 % in 201 5, up from 1.4% in 2014.
  • Consumer price inflation: 5.7 % in 201 5, down from an average of 6.1% in 2014.
  • The report's universe agribusiness market value: 2.3 % year-on-year (y-o-y) decrease to USD1 6.4 bn in 2014/15.