Agricultural Policy Monitoring and Evaluation 2025

24. South Africa

Main findings

Support to agriculture

Support to producers (Producer Support Estimate, PSE) in South Africa amounted to 3.1% of gross farm receipts in 2022-24, down from 7.4% in 2000-02. Market Price Support (MPS) and support for variable input use without constraints are the largest components of producer support, with the share of potentially most-distorting gross producer transfers amounting to 97% in 2022-24.

Overall, domestic prices for most commodities align with border reference prices. Sugar is an exception, mainly due to import tariffs, leading to single commodity support worth 25% of gross receipts. Milk and sheep meat also benefit from market price support. Most direct payments are provided as input subsidies (fuel tax refund) or as investment subsidies directed towards small-scale farming.

Support for general services to the sector (General Service Support Estimate, GSSE) has declined relative to the size of the sector. The GSSE averaged 1.1% of the value of agricultural production during 2022-24, below the 3.8% observed in the early 2000s, and below the average of 2.4% observed for the 54 countries covered in this report. Most payments to general services go to the agricultural knowledge and innovation system, and to infrastructure (mainly related to land reforms, irrigation, and other infrastructure). Support in these categories targets an enabling environment for small-scale farming, which became a priority following land reforms. Expenditures for inspection and control are also an important and growing element of the GSSE.

Total support to the sector fell in relative terms from an average 0.6% of Gross Domestic Product (GDP) in 2000-02 to 0.3% in 2022-24, with more than two-thirds of the support transferred to individual producers.

Key recent policy changes

The Department of Agriculture, Land Reform, and Rural Development (DALRRD) was split into two separate departments, with agriculture becoming a standalone department in April 2025. The department’s primary focus will be support for subsistence and smallholder farmers. Additionally, the Comprehensive Agricultural Support Programme grant has been merged with the Ilima/Letsema grant. The merge stems from the 2021 Parliamentary Budget Office Policy Brief on Performance on Agriculture Conditional Grants, which highlighted a duplication of outputs and recommended merging the two grants to streamline processes.

The Expropriation Act No. 13 of 2024, effective 23 January 2025, allows the government to acquire property for public purposes with just and equitable compensation, replacing the 1975 market-value-based system. Compensation considers land use, history, market value, state investment, and purpose, with provisions for little or no compensation in cases of unused, abandoned, or state-funded land.

On 20 December 2024, the Plant Health Act was passed. It provides a new regulatory framework for phytosanitary standards and repeals the Agricultural Pests Act of 1983, which previously regulated South Africa’s plant phytosanitary system. The new law makes South Africa compliant with the WTO Agreement on the Application of Sanitary and Phytosanitary Measures and the International Plant Protection Convention. Compliance with these agreements can be expected to expand agricultural trade opportunities for South Africa.

Assessment and recommendations

• South Africa has made efforts to integrate sustainability considerations into its trade policy and to mitigate GHG emissions from its agricultural sector. At the same time, significant agri-environmental challenges remain, including soil degradation, water scarcity, and increased vulnerability to climate change and extreme weather events. Nutrient balances are very low and even negative in the case of nitrogen, suggesting that low soil fertility is a problem across South Africa. The government should support conservation agriculture practices to improve soil fertility and enhance organic matter content, expand soil testing and advisory services, and improve access to quality fertilisers for smallholders.

• Overall support is low, but the support that remains is highly market distorting and may be harmful to the environment. MPS for sugar remains high, and the government should consider reducing the import duty. The diesel rebate accounts for a large share of budgetary support and should also be phased out. It could be replaced with credit for working capital that is not input-specific, while providing targeted cash transfers and social welfare assistance to ease the transition for low-income and vulnerable farm households.

• Budgetary spending continues to be oriented towards land reform and its beneficiaries (mainly smallholders and emerging commercial farmers) in the form of research and development, knowledge transfer, and infrastructure. The government should focus efforts on strengthening land reform delivery instruments, providing adequate and timely funding for economically viable farm businesses, and tailoring support programmes to the needs of emerging commercial farmers.

• If support programmes are to help emerging entrepreneurs become commercial producers, they must draw upon the experiences of successful commercial farmers. Specifically, public-private partnerships and industry associations can help to strengthen programmes and services offered by public authorities and support the transfer of know-how to new entrant farmers.

• Progress on land reform and redistribution in the post-Apartheid era has been slow and is becoming a matter of increasing urgency. The recently adopted Expropriation Act provides a legal framework to govern the expropriation of private property by the government for public purposes or in the public interest. However, land reform should be linked to developing an enabling environment for its beneficiaries, including education, training, infrastructure, and access to modern farming equipment, finance, and markets.

• Capacity in the private sector and learning and training institutions can be leveraged to revitalise public-extension services. Particularly important is upskilling public extension officers and providing them with resources to service rural communities and emerging commercial producers. Without these developments, land redistribution cannot deliver the expected outcomes, such as improving the welfare of rural black populations, increasing food security in rural areas, and developing a viable commercial sector.

• Draft sectoral emissions targets for the agricultural sector were recently published and can help South Africa to make progress in meeting its Nationally Determined Contributions (NDCs). However, carbon taxes in place since January 2022 under the Carbon Tax Act have not been applied to agriculture. South Africa could consider extending the scope of the carbon tax to progressively include agricultural emissions, along with social safety-net policies to offset potential income losses for poor households and producers caused by this change.

Development of support to agriculture

Table 24.1. South Africa: Estimates of support to agriculture

Million USD

	2000-02	2022-24	2022	2023	2024p
Total value of production (at farm gate)	6 819	24 270	25 382	22 983	24 443
of which: share of MPS commodities (%)	74.75	76.05	79.20	74.62	74.31
Total value of consumption (at farm gate)	5 995	21 201	20 410	21 110	22 084
Producer Support Estimate (PSE)	480	763	819	603	865
Support based on commodity output	440	596	647	446	695
Market price support¹	440	596	647	446	695
Positive market price support	453	596	647	446	695
Negative market price support	-12	0	0	0	0
Payments based on output	0	0	0	0	0
Payments based on input use	36	167	172	157	170
Based on variable input use	25	140	138	134	149
with input constraints	0	0	0	0	0
Based on fixed capital formation	11	26	34	22	21
with input constraints	0	0	0	0	0
Based on on-farm services	1	0	1	0	0
with input constraints	0	0	0	0	0
Payments based on current A/An/R/I, production required	3	0	0	0	0
Based on Receipts / Income	3	0	0	0	0
Based on Area planted / Animal numbers	0	0	0	0	0
with input constraints	0	0	0	0	0
Payments based on non-current A/An/R/I, production required	0	0	0	0	0
Payments based on non-current A/An/R/I, production not required	0	0	0	0	0
With variable payment rates	0	0	0	0	0
with commodity exceptions	0	0	0	0	0
With fixed payment rates	0	0	0	0	0
with commodity exceptions	0	0	0	0	0
Payments based on non-commodity criteria	0	0	0	0	0
Based on long-term resource retirement	0	0	0	0	0
Based on a specific non-commodity output	0	0	0	0	0
Based on other non-commodity criteria	0	0	0	0	0
Miscellaneous payments	0	0	0	0	0
Percentage PSE (%)	7.37	3.12	3.21	2.61	3.51
Producer NPC (coeff.)	1.08	1.03	1.03	1.02	1.03
Producer NAC (coeff.)	1.08	1.03	1.03	1.03	1.04
General Services Support Estimate (GSSE)	264	263	271	257	262
Agricultural knowledge and innovation system	146	109	110	94	123
Inspection and control	39	62	58	82	48
Development and maintenance of infrastructure	78	75	85	64	76
Marketing and promotion	0	17	18	17	16
Cost of public stockholding	0	0	0	0	0
Miscellaneous	0	0	0	0	0
Percentage GSSE (% of TSE)	34.04	25.70	24.86	29.85	23.24
Consumer Support Estimate (CSE)	-353	-525	-594	-401	-579
Transfers to producers from consumers	-350	-518	-588	-391	-574
Other transfers from consumers	-18	-7	-6	-10	-5
Transfers to consumers from taxpayers	0	0	0	0	0
Excess feed cost	14	0	0	0	0
Percentage CSE (%)	-6.08	-2.46	-2.91	-1.90	-2.62
Consumer NPC (coeff.)	1.07	1.03	1.03	1.02	1.03
Consumer NAC (coeff.)	1.06	1.03	1.03	1.02	1.03
Total Support Estimate (TSE)	744	1 026	1 091	860	1 127
Transfers from consumers	368	525	594	401	579
Transfers from taxpayers	394	508	502	469	553
Budget revenues	-18	-7	-6	-10	-5
Percentage TSE (% of GDP)	0.56	0.26	0.27	0.23	0.28
Total Budgetary Support Estimate (TBSE)	304	430	443	414	432
Percentage TBSE (% of GDP)	0.22	0.11	0.11	0.11	0.11
GDP deflator (2000-02 = 100)	100	370	354	371	386
Exchange rate (national currency per USD)	8.70	17.71	16.36	18.45	18.33

Note: p: provisional. NPC: Nominal Protection Coefficient. NAC: Nominal Assistance Coefficient. A/An/R/I: Area planted/Animal numbers/Receipts/Income. 1. Market Price Support (MPS) is net of producer levies and excess feed cost. MPS commodities for South Africa are: wheat, maize, sunflower, sugar, milk, beef and veal, pig meat, sheep meat, poultry, eggs, groundnuts, grapes, oranges and apples.

Source: OECD (2025), “Producer and Consumer Support Estimates”, OECD Agricultural policy monitoring (database), https://data-explorer.oecd.org/.

Policy landscape

Main policy instruments

South Africa’s National Development Plan 2030 is a key national policy that was launched in 2012 and offers a comprehensive and forward-looking strategy to provide all sectors with a roadmap to address social, economic, and political challenges by 2030. For the agricultural sector, Chapter 6 of the plan outlines the sector’s vision to contribute to an integrated and inclusive economy through the expansion of agricultural activity, effective land reform, and sustainable rural development.

The Agriculture and Agro-processing Masterplan, approved in May 2022, identifies four pillars of agricultural policy:

• Resolving policy ambiguities and creating an investment friendly environment; investing in and maintaining enabling infrastructure critical to industry.

• Providing comprehensive farmer support; improving food security.

• Facilitating market expansion and promoting trade.

• Increasing local food production and reducing reliance on imports.

The Agricultural Land Holding Account (ALHA) allows the state to acquire land using public funds to meet the demand for land to build sustainable rural livelihoods. Over the medium term, the ALHA aims to acquire 115 467 ha of strategically located land, of which 50% is set to be allocated to women, 40% to young people, and 10% to people with disabilities (GCIS, 2023[1]).

The Comprehensive Agricultural Support Programme helps new beneficiaries of land reform to access credit from commercial banks and the government-owned Land and Development Bank. The programme targets subsistence, smallholder, and black commercial farmers from a previously disadvantaged background. It focuses on providing producers with on- and off-farm infrastructure and production inputs; capacity building; marketing and business development support; advisory services; regulatory services; and financial services.

The Micro Agricultural Financial Institutions of South Africa (MAFISA) provides financial services to smallholders in the agriculture, forestry, and fisheries sector. The objective of the scheme is to address the financial services needs of smallholders. Services provided through the scheme include production loans, savings facilitation, and capacity building for member-owned financial institutions (intermediaries).

South Africa is a founding member of the Southern African Customs Union (SACU), a full customs union with a common external tariff.1 Border measures applied on SACU common borders (comprised of specific and ad valorem tariffs) are the only price support policy. The average applied Most Favoured Nation (MFN) tariff for agricultural products is 8.5%, which is higher than the average applied MFN tariff for non-agricultural products of 7.4% (WTO, 2024[2]). Tariff rate quotas (TRQs) exist for a range of agricultural products under the WTO minimum market access commitments.2 A zero import-tariff for maize applies since 2007.

A tariff of ZAR 549/tonne (USD 30/tonne) applies to wheat imports since 17 April 2025. Beef and sheep meat are subject to tariff rate quotas with outside-quota tariffs of 40% or ZAR 2.40/kg (USD 0.13/kg) for beef, and 40% or ZAR 2.00/kg (USD 0.11/kg) for sheep meat, whichever is higher. For pork meat the outside-quota tariff is 15% or ZAR 1.30/kg (USD 0.07/kg), except for ribs, which are not subject to tariffs. Poultry products have import tariffs ranging from zero to 82%.

South Africa applies the dollar-based reference price (DBRP) mechanism to ensure that the price importers pay for imported sugar (inclusive of the duty) cannot fall below a fixed DBRP level, currently set at USD 680 per tonne. If import prices are lower than the DBRP, an import duty is applicable, whereas if import prices are higher than the DBRP, no import duty is owed (USDA, 2024[3]).3

South Africa is also a member of the Southern African Development Community (SADC).4 Trade between South Africa and the European Union takes place under the SADC-EU Economic Partnership Agreement (EPA) regime. This is a free trade agreement between the SADC EPA States (comprised of all SACU Member States plus Mozambique) and the European Union. The most important benefit for South Africa is the enhanced market access for agricultural products such as sugar, wine, some dairy products, flowers, fruits and nuts as well as their preparations. The agreement has contributed to an increase in South Africa’s exports of agricultural products to the European Union in recent years.

Other free trade agreements relevant to agriculture include the SACU-EFTA FTA, a free trade agreement between members of the European Free Trade Association (EFTA) and the SACU which came into force in 2008, and the SACU and Mercosur Preferential Trade Agreement (PTA) which came into force in 2016. Trade between South Africa and the United Kingdom is governed by the SACUM-UK EPA,5 which is a replica of the SADC-EU EPA in terms of market access commitments with the exception of a few provisions that were modified during negotiations. The agreement provides important benefits for South Africa, including enhanced market access for wines and sugar into the United Kingdom.

South Africa is also a beneficiary of the US African Growth and Opportunity Act (AGOA), a non-reciprocal trade preference programme that grants eligible Sub-Saharan African countries duty-free, quota-free (DFQF) access to the United States for selected export products. AGOA was enacted in 2000 for eight years. The Act has been extended twice and is set for review in 2025. South Africa’s major agricultural export products benefiting from AGOA are mandarins, oranges, macadamia nuts and wine.

According to South Africa’s Low Emission Development Strategy and its Nationally Determined Contribution (NDC), the country aims to reach net zero emissions by 2050 and has a fixed target of limiting annual greenhouse gas (GHG) emissions to 350-420 MtCO₂eq in 2030. Emissions from agriculture totalled 41 MtCO₂eq in 2020 (excluding LULUCF) and accounted for about 8.7% of total GHG emissions.

The Carbon Tax Act is an integral part of government policy on climate change and will be implemented in three phases. The first phase lasted from June 2019 to December 2022 and initially only applied the carbon tax to scope 1 emitters, with discounted tax rates provided ranging from 60% to 95%. The marginal tax rate will increase steadily with the implementation of the second phase, which was due to begin in January 2023, but was subsequently postponed to January 2026. The carbon tax rate in January 2022 was ZAR 144 (USD 8.80) per tonne of carbon dioxide equivalent (tCO₂eq), increasing to ZAR 159 (USD 8.62) in 2023 and ZAR 190 (USD 10.37) in 2024. The tax currently covers about 90% of South Africa’s GHG emissions, but excludes the agriculture, forestry, land use and waste sectors. Agriculture will continue to be excluded from the carbon tax until at least 2026, for the duration of the first transition phase of the carbon tax.

Fuel taxes are relatively high in South Africa and contribute about 6% to government revenues (OECD, 2022[4]). However, primary producers on land (farming, forestry and mining) qualify for full or partial relief for the fuel levy. The refund amounts to 100% of the Road Accident Fund levy and 40% of the fuel levy, applicable to 80% of eligible diesel fuel purchases. In order to claim the refund, farmers must be registered for VAT purposes and are required to maintain records of purchase invoices, sales invoices, and logbooks.

Policies for trade and sustainability in agro-food markets

On 1 December 2024, South Africa became the first African state to assume the G20 presidency, taking over from Brazil. South Africa’s presidency is running under the theme “Solidarity, Equality, Sustainability”, and food security has been identified as one of the three main priority areas. Under the Trade and Investment Working Group, South Africa has been promoting a responsive trade and investment agenda, and is working to strengthen dialogue on addressing climate measures that have an impact on trade to avoid fragmentation.

The SADC-EU EPA and the SACUM-UK EPA both contain environmental co-operation provisions with explicit linkages to agriculture. Under both agreements, Article 68 on “Cooperation on agriculture” underlines the importance of agriculture for food security, rural employment, farmer incomes and sustainable development. They prohibit the use of export subsidies on agricultural goods, and establish an agricultural partnership to facilitate exchanges on agriculture, food security, development, regional value chains, and integration. In addition, both agreements contain an Article 16 on “Cooperation on Protection of Intellectual Property Rights”, which recognises the importance of Geographical Indications and origin-linked products for sustainable agriculture and rural development (SADC-EU, 2016[5]; SACUM-UK, 2019[6]).

The Tripartite Free Trade Area (TFTA) is a regional trade agreement that brings together three major African economic blocs: the Southern African Development Community (SADC), the East African Community (EAC), and the Common Market for Eastern and Southern Africa (COMESA). On 25 July 2024, the TFTA officially came into effect following ratification by participating member states, including South Africa. The agreement is set to be integrated into the African Continental Free Trade Area (AfCFTA), expanding its current membership from 29 to 54 states, and further strengthening intra-African trade through the liberalisation of tariffs and elimination of non-tariff barriers. The TFTA has important implications for sustainability in South Africa’s agriculture and food sectors, by encouraging regional co-operation on climate-smart agriculture through improved access to drought-resistant seeds, shared weather forecasting, and regional approaches to disaster risk reduction. TFTA also offers opportunities for harmonising environmental and food safety standards.

The Climate Change Act came into effect on 23 July 2024, providing a legal framework for South Africa’s commitments to meet its Nationally Determined Contributions (NDCs) and to support the transition to a low-carbon and climate-resilient economy and society. The act requires the development of an adaptation strategy for the agricultural sector that is aligned with the National Adaptation Plan and Strategy. By enhancing resilience, the act helps to ensure that South Africa’s agricultural sector remains competitive and can ensure a steady supply of food for both domestic and export markets.

The Climate Change Act also regulates the agricultural sector’s obligation to publish sectoral emissions targets (SETs). Draft SETs were released by the Department of Forestry, Fisheries and the Environment (DFFE) on 26 April 2024, establishing co-ordinated sectoral targets to assist the country in achieving its 2030 NDC target. The agricultural sector has a cumulative SET allocation to reduce emissions by 3.4 MtCO₂ over the period from 2025 to 2030. Meeting emission reduction targets and reducing the carbon footprints of agricultural products can help to improve the sustainability profile and increase market access for South Africa’s agricultural exports.

Recent policy developments

Domestic policy developments in 2024-25

The Expropriation Act No. 13 of 2024, which came into effect on 23 January 2025, provides a legal framework for the government to acquire private property for public purposes or in the public interest. The act replaces the 1975 Expropriation Act and aligns the law with the 1996 constitution, by regulating the procedures for expropriation of property, and ensuring that payment of compensation is just and equitable. It also identifies instances where it is just and equitable for nil compensation to apply when land is expropriated in the public interest. Factors considered include the current use of the land, its acquisition history, market value, government investments or subsidies, and the purpose of the expropriation. Additionally, the act allows for cases where little or no compensation may be paid, particularly when land is unused and held for speculative purposes, owned by a government entity with no intended use, abandoned by the owner, or where state investment in the land exceeds its market value.

On 13 March 2024, Cabinet approved the National Policy on Comprehensive Producer Development Support, which serves as the overall policy that guides and regulates the government’s support services given to the different categories of producers.6 In addition, the policy scope extends to stakeholders involved in producer support services (e.g. from the private sector, civil society, and development partners). The policy uses a range of tools to revitalise South Africa’s agri-food sector and is designed to promote the social and economic prosperity of producers, with different funding limits imposed for each producer category. The policy will be implemented in phases starting on 1 April 2025, with the larger scale phase (national) expected to be implemented in 2026.

The Agricultural Products Standards Amendment Act was passed on 3 April 2024. This act modifies provisions in Act No. 119 of 1990 to address deficiencies in the management control system of agricultural products. Specifically, it introduces provisions allowing for independent entities to perform certain audit and inspection functions for quality control of agricultural products.

The Preservation and Development of Agricultural Land Act was passed on 28 January 2025. The act ensures that the country’s agricultural land is available to support food production goals and the agricultural sector’s contribution to the economy. It includes provisions for agro-ecosystem management and outlines a guiding framework for the establishment and management of the national agro-ecological information system.

In 2025, South Africa ratified the International Treaty on Plant Genetic Resources for Food and Agriculture, becoming the 154^th contracting party to this agreement. The treaty aligns with the Convention on Biological Diversity that is focused on conservation of biological diversity, sustainable use of its components, and equitable sharing of benefits arising from genetic resources. This highlights South Africa’s dedication to sustainable and responsible use of plant genetic material to achieve food security and maintain agricultural biodiversity.

The Communal Property Associations Amendment Act, effective 8 October 2024, aims to address, in part, challenges faced by the Department of Land Reform and Rural Development in implementing the initial Communal Property Associations Act. These challenges include the misuse of power by people elected to the association committees, inadequate authority by the state to intervene, and poor monitoring and oversight by the department. They affect the governance of agricultural land held in communal tenure, particularly in rural areas where communal land is often used for agricultural purposes. The amendments include provisions for the establishment of a communal associations office and the appointment of a registrar of communal property associations. These institutional improvements are expected to enhance security of tenure and decision-making around land use.

As part of its 2024-25 short-term initiatives, the Department of Agriculture is in the process of developing an online producer support system consisting of four modules: (1) E-Voucher; (2) Farm Register; (3) Online Extension Directory; and (4) Decision Support Services. Together, the modules are expected to streamline financial support, maintain an updated database, provide a platform to connect farmers to extension services, and facilitate evidence-based decision-making for farmers. The department anticipates launching modules 1 and 2 during the 2025-26 financial year.

Trade policy developments in 2024-25

A sugar import tariff of ZAR 2 349 (USD 128) per tonne was gazetted on 8 August 2024 (the tariff was triggered in May 2024). The previous sugar import tariff was set at ZAR 1 094 (USD 60) per tonne from 19 July 2024 to 7 August 2024. Since May 2024 there have been four additional trigger points following the initial ZAR 2 349 (USD 128) per tonne trigger, of which all have been officially gazetted. The most recent trigger level currently stands at ZAR 2 828 (USD 154) per tonne.

South Africa joined the African Continental Free Trade Area’s (AfCFTA) Guided Trade Initiative in January 2024. Under this pilot programme, members have the opportunity to trade specific goods (including food and beverages) between select countries at reduced tariffs.

South Africa and the People’s Republic of China (hereafter “China”) signed three important agricultural market access agreements during the Forum on China-Africa Cooperation (FOCAC) held in Beijing on 4-6 September 2024. These include the (1) Protocol on dairy products to be exported from South Africa to China; (2) Protocol for greasy wool exports from South Africa to China, and (3) Memorandum of Understanding on Foot and Mouth Disease.

South Africa secured market access for its avocado exports to India and Japan in 2024. Discussions are currently underway with India to secure export access for litchis and blueberries, and with China for export access for stone fruits (excluding cherries).

At the beginning of 2025 South Africa regained export access for apples to Thailand for the first time in 16 years. However, this access is subject to phytosanitary requirements agreed by the two countries in 2024. On 14 March 2024, DALRRD and the Citrus Growers’ Association of Southern Africa announced the establishment of a new bilateral protocol opening the Vietnamese market to South African oranges. The protocol was signed almost a decade after changes to import regulations by Viet Nam that restricted South Africa’s market access to the country. The protocol is anticipated to boost South Africa’s export potential by 15 000 tonnes.

On 30 September 2024, South Africa lifted its ban on US soybeans, allowing imports to resume. This decision followed the approval of genetically engineered (GE) soybeans previously not recognised by South Africa. The move aimed to address a 35% domestic production reduction that resulted from a mid-summer drought, and was also an attempt to maintain a stable supply for the country’s crushing industry.

Concerns have been raised about growing trade tensions between SACU members. In December 2024, Botswana lifted its 2021 import ban on vegetables from South Africa, which helped ease trade friction between the two SACU members. However, Namibia has retained similar restrictions (with monthly reviews), ostensibly to protect and strengthen Namibia’s domestic vegetable industry. The South African Government is also in discussions to amicably resolve the import ban on South African citrus imposed by Botswana and Namibia.

Policy context

Key economic and agricultural statistics

South Africa has the largest economy (measured by nominal GDP) on the African continent. With a GNI per capita of USD 6 480 in 2023, South Africa ranks as an upper middle-income country. While its economy is highly industrialised and diversified, income inequality is high and widespread poverty persists.

Agriculture represents a small share of the economy, at just 2.8% of GDP, although its share in employment is substantially higher, at 18.8% (Table 24.2). South Africa has abundant agricultural land, but only 12.5% of it is arable, while the remaining agricultural area is mostly semi-arid pastures with extensive livestock production. The farm structure is highly dualistic, with a well-developed and market-oriented sector of large-scale commercial farms and a large number of smallholder farms.

Table 24.2. South Africa: Contextual indicators

	South Africa		International comparison
	2000*	2023*	2000*	2023*
Economic context			Share in total of all countries
GDP (billion USD in PPPs)	382	960	1.0%	0.6%
Population (million)	44	63	1.0%	1.2%
Land area (thousand km2)	1 213	1 213	1.5%	1.5%
Agricultural area (AA) (thousand ha)	98 125	96 341	3.3%	3.3%
			All countries1
Population density (inhabitants/km2)	39	52	52	64
GDP per capita (USD in PPPs)	8 095	15 194	9 368	29 013
Trade as % of GDP	17.5	28.7	12.3	14.9
Agriculture in the economy			All countries1
Agriculture in GDP (%)	2.8	2.8	2.9	3.5
Agriculture share in employment (%)	20.3	18.8	-	-
Agro-food exports (% of total exports)	8.5	12.0	6.4	8.1
Agro-food imports (% of total imports)	5.2	6.5	5.8	7.3
Characteristics of the agricultural sector			All countries1
Crop in total agricultural production (%)	55.6	54.0	-	-
Livestock in total agricultural production (%)	44.4	46.0	-	-
Share of arable land in AA (%)	14.1	12.5	31.8	33.3

Note: *or closest available year.

1. Average of all countries covered in this report.

Sources: OECD statistical databases; International Labour Organisation (ILO); UN Comtrade; World Bank, WDI; FAO database and national data.

Inflation in South Africa has been relatively moderate, increasing from 3.2% in 2020 to a peak of 7.0% in 2022, and declining to 4.4% in 2024. The unemployment rate is persistently high, reaching 32% in 2024, and remains an obstacle for alleviating poverty. Real GDP growth has been declining since 2011 and dropped to -6.2% in 2020, in response to COVID-19 restrictions and economic impacts of the pandemic, before rebounding strongly in 2021 to 5% and then slowing to just 0.6% in 2024 (Figure 24.4).

South Africa has consistently been a net exporter of agro-food products (Figure 24.5). In 2023, the share of agrifood exports in total exports was 12%, while the share of agro-food imports was 6.5% (Table 24.2). The majority (56%) of agro-food exports are primary agricultural products, whereas around three-quarters of agro-food imports are processed products (Figure 24.5).

Agricultural output growth has been similar to the global average over the 2013-22 period, but driven predominantly by increased use of intermediate inputs (Figure 24.6). This was not the case in the 1990s, where annual TFP growth averaged 1.6%, however TFP growth has slowed significantly since then, and remained unchanged over the 2012-21 period. This is substantially lower than the average growth rate worldwide of 0.8% (Table 24.3).

Phosphorus and nitrogen balances are very low and negative, respectively, and well below the OECD average. Although agriculture uses most (58%) of abstracted water, only a few regions have irrigated land, and water resources are scarce in most agricultural areas (Table 24.3). The livestock sector is an important source of water consumption. Agriculture’s share in total energy use has increased to 3.2% and remains above the OECD average of 2.0%.

Table 24.3. South Africa: Productivity and environmental indicators

	South Africa		International comparison
	1991-2000	2013-2022	1991-2000	2013-2022
			World
TFP annual growth rate (%)	1.6%	0.0%	1.7%	0.8%
			OECD average
Environmental indicators	2000*	2023*	2000*	2023*
Nitrogen balance, kg/ha	-6.3	-4.6	32.0	29.7
Phosphorus balance, kg/ha	0.2	0.0	3.3	2.5
Agriculture share of total energy use (%)	2.7	3.2	1.7	2.0
Agriculture share of GHG emissions (%)	9.1	8.7	8.7	10.1
Share of irrigated land in AA (%)	1.5	2.3	-	-
Share of agriculture in water abstractions (%)	70.6	57.5	47.0	49.5
Water stress indicator	33.7	65.8	8.7	..

Note: * or closest available year.

Sources: USDA Economic Research Service, Agricultural Productivity database; OECD statistical databases; FAO database and national data.

Historical trends in agricultural policies

Widespread support, regulation, and price and production control within a closed economy characterised agricultural policy in South Africa under the apartheid regime between 1955 and 1990.

Post-apartheid, quick and substantial reforms in the mid-1990s reduced state intervention in agricultural markets and led to more market-oriented commercial farming. Domestic marketing of agricultural products was deregulated, and barriers to agricultural trade were reduced by replacing direct import controls with tariffs, removing state controls over exports, and eliminating export subsidies. These reforms reduced market price support and budgetary support to commercial farming.

As stated in the White Paper on Land Policy of 1997, land reform aimed to redress past injustices, foster reconciliation and stability, support economic growth, improve household welfare, and alleviate poverty. Land reform is ongoing and new legislation and regulations have been submitted to facilitate the process. Key elements of land reform included land restitution, land redistribution and land-tenure reform. As of 2024, 19.3 million ha (or 25% of freehold farmland in South Africa) had been restored, redistributed to black South Africans, or transferred to state ownership (Kirsten and Sihlobo, 2024[7]). Of this, 3.17 million ha has been acquired by the state, 11.55 million ha have been transferred to black owners through land restitution or redistribution, and at least 1.9 million ha of farmland were acquired by black South Africans without assistance from the state. In several instances, communities elected to receive financial compensation instead of obtaining formal rights to the land (2.68 million ha in addition to the transferred land). Since it started, the land reform has been accompanied by agricultural support targeting black smallholders and emerging producers who were previously excluded from support by the apartheid government. Mainly provided within the Comprehensive Agricultural Support Programme, these measures include subsidies for variable and fixed input credit and financial support, extension, marketing, and training services (Table 24.4).

Table 24.4. South Africa: Agricultural policy trends

Period	Framework	Changes in agricultural policies
Prior to mid-1990s	Closed economy under the apartheid regime	Large subsidies for commercial agricultural producers Import controls; export subsidies for agricultural products Price and production controls under the Agricultural Marketing Act of 1937
Mid-1990s-present	Post-apartheid period; democratic government; market deregulation and trade liberalisation Land redistribution; emphasis on black small-scale producers’ development	Marketing of Agricultural Products Act (1996) brings market deregulation and trade liberalisation WTO accession Agricultural tariffs replace import controls Import tariffs applied to sugar and livestock products (except eggs), with tariff-free imports of maize (since 2007) Land restitution and redistribution Land reform-related programmes supporting black smallholder farmers: - Increased spending to finance the land reform process - Direct support targeting black smallholders

Support to farmers decreased as a share of gross farm receipts (with some year-to-year variation) during the period from 1995 to 2007 due to policy reforms and deregulation of the market. Since then, support continued to trend downwards, reaching a record low of 2.6% of gross farm receipts in 2023 (Figure 24.7). Budgetary support to producers, mostly input subsidies, is targeted to black smallholders. Budgetary expenditures on general services to the sector are increasing and spent mainly on knowledge transfer and infrastructure.

References

[1] GCIS (2023), “Agriculture, Land Reform and Rural Development”, Official Guide to South Africa 2022/23, https://www.gcis.gov.za/sites/default/files/docs/07%20Agricultture%2C%20Land%20Reform%20and%20Rural%20Development.pdf (accessed on 15 April 2025).

[7] Kirsten, J. and W. Sihlobo (2024), “This is how President Ramaphosa got to the 25% figure of progress in land reform in South Africa”, The Conversation, https://theconversation.com/this-is-how-president-ramaphosa-got-to-the-25-figure-of-progress-in-land-reform-in-south-africa-226135 (accessed on 31 May 2025).

[4] OECD (2022), OECD Economic Surveys: South Africa 2022, OECD Publishing, Paris, https://doi.org/10.1787/d6a7301d-en.

[6] SACUM-UK (2019), Economic Partnership Agreement between the Southern African Customs Union Member States and Mozambique, of the one part, and the United Kingdom of Great Britain and Northern Ireland, of the other part, https://assets.publishing.service.gov.uk/media/5dc1467a40f0b6379f9f42c0/MS_34.2019_v1_pt1_UK_SACU_Mozambique_EPA.pdf (accessed on 26 May 2025).

[5] SADC-EU (2016), “ECONOMIC PARTNERSHIP AGREEMENT between the European Union and its Member States, of the one part, and the SADC EPA States, of the other part”, Official Journal of the European Union, https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:22016A0916(01) (accessed on 26 May 2025).

[3] USDA (2024), “South Africa: Sugar Annual”, Global Agricultural Information Network (GAIN), https://fas.usda.gov/data/south-africa-sugar-annual-8 (accessed on 6 June 2024).

[2] WTO (2024), Tariff profiles - South Africa, https://www.wto.org/english/res_e/statis_e/daily_update_e/tariff_profiles/ZA_E.pdf (accessed on 25 March 2025).

Notes

← 1.  The SACU members are Botswana, Eswatini (former Swaziland), Lesotho, Namibia, and South Africa.

← 2.  TRQs are allocated based on historical trade as specified under each TRQ. If the TRQs are unused by 1 September each year, then unused TRQs are available to other member states. The establishment of a permanent TRQ Management System at the SACU level is still in progress.

← 3.  Adjustments to the level of protection granted are made when the 20-trading day moving average of the London No. 5 settlement price shows a variance of more than USD 20 per tonne from the previous trigger level for 20 consecutive trading days. The resulting Dollar duty is then converted to Rand, based on the Rand/Dollar exchange rate prevailing on the day that the adjustment is triggered, and subsequently adjusted with the latest available Real Effective Exchange Rate as published by the South African Reserve Bank.

← 4.  The SADC member countries are Angola, Botswana, Democratic Republic of Congo, Eswatini, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Tanzania, Zambia, and Zimbabwe.

← 5.  The Economic Partnership Agreement between the SACU Member States (Botswana, Eswatini, Lesotho, Namibia and South Africa) and Mozambique on the one part, and the United Kingdom of Great Britain and Northern Ireland on the other part (SACUM-UK EPA) entered into force on 1 January 2021.

← 6.  Producers are categorised into the following six distinct groups: (1) Household Producer (Vulnerable); (2) Household Producer (Subsistence); (3) Smallholder Producer; (4) Medium Scale Commercial Producer; (5) Large Scale Commercial Producer; and (6) Mega/Corporate Producer.