Agribusiness confidence rebounds in Q4 as strong exports, improved logistics lift sentiment

South Africa’s agribusiness confidence bounced back in the final quarter of the year, rising by five points to 67 in the Agbiz/IDC Agribusiness Confidence Index (ACI), released on Friday.

The improvement follows two consecutive quarterly declines and places the index firmly above the neutral 50-point mark, signalling renewed optimism across the sector.

Wandile Sihlobo, chief economist at the Agricultural Business Chamber (Agbiz), said favourable production conditions and strong export performance underpinned the rebound.

“Favourable weather conditions, strong exports throughout the year on the back of ample grains, oilseeds, and horticulture harvests, as well as better port efficiencies, are among the key drivers of optimism in the sector,” he said.

He added that government’s announcement of a nationwide foot-and-mouth disease (FMD) vaccination campaign had also buoyed sentiment, given the long-running challenges the disease poses.

The survey, conducted in late November, revealed broad improvements across most of the ACI’s 10 subindices.

The capital investment subindex rose seven points to 74, reflecting strong tractor and harvester sales. Tractor sales for the first 10 months of 2025 reached 6 122 units, up 11% year-on-year, while combine harvester sales rose 8% to 197 units.

The export volumes subindex surged by 32 points to 75, in line with South Africa’s strong agricultural export performance. Export values for the first three quarters of 2025 reached $11.7 billion (R198 billion), 10% higher than the same period in 2024.

General production conditions also strengthened, with that subindex rising four points to 71 on expectations of beneficial La Niña rainfall in the 2025/26 season. The market share subindex gained 11 points to 71, while the employment subindex lifted to 53, supported by rising farm job numbers—up 2% to 920 000 in Q3.

Broader economic sentiment within the sector improved as well. The general economic conditions subindex rose to 62, reflecting increased macroeconomic confidence following South Africa’s removal from the Financial Action Task Force grey list, S&P’s rating upgrade and reforms under Operation Vulindlela.

However, two subindices weakened slightly. Turnover confidence fell by four points to 71, driven largely by winter crop regions facing lower commodity prices despite good harvests. Net operating income dipped six points to 65.

Sihlobo cautioned that while conditions are improving, the recovery remains uneven.

“Still, the recovery of the sector this year will likely be uneven. We see better production conditions in the horticulture and field crops,” he said.

“However, the livestock industry is under pressure due to foot-and-mouth disease. What will help in the recovery going into 2026 will be the speedy vaccination process against foot-and-mouth disease in the roughly 12 million national herd of cattle, with 7.2 million of them in commercial production.”

Dawie Maree, FNB's head of agriculture information and marketing, agreed with the assessment that sentiment is more positive in Q4 than in previous quarters.

“Production conditions are currently more positive, although in some areas of the summer grain-producing areas, we do have some problems with too wet conditions. Overall, it is not looking too bad,” he said.

Maree added that the continuous outbreak of FMD definitely had a dampening effect on the confidence index, but the recent announcement by the Minister of Agriculture about vaccinating the livestock herd can probably be seen as a positive move.

“It will all now depend on implementation. Improved logistics definitely contributed to the overall positive sentiment as well. Only two sub-indexes (turnover and net operating income) reported a mild contraction, but both are still in positive (>50) territory in any case.”

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