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The South African agricultural sector is entering a period of consolidation as falling commodity prices, rising production costs, and limited consumer demand are expected to put pressure on producers. Nevertheless, opportunities for growth exist in export markets, productivity gains, and higher value-added products.

These findings were presented at the Bureau for Food and Agricultural Policy's (BFAP) baseline agricultural policy forecast presentation for 2026 in Pretoria. The report analyzes the sector's trajectory over the next decade, considering the long-term future of agriculture up to 2050.

Speaking at the main report, Minister of Agriculture William Aukamp stated that farmers possess the necessary knowledge to stimulate growth in the agricultural sector, and the government's role is to create a favorable environment. Aukamp emphasized that farmers are world-class and fully knowledgeable about their operations.

He insisted that the government should focus on removing obstacles rather than creating additional administrative burdens. The Minister assured that the government's responsibility is to facilitate farmers' work, and he personally commits to this.

Furthermore, Aukamp called for increased collaboration between industry and government, especially when there are disagreements, in addressing issues such as animal diseases, infrastructure, market access, and export growth.

BFAP Director and founder, Professor Ferdie Meyer, thanked BFAP partners for their support and contribution. In turn, BFAP Director and Commodity Markets and Futures Manager, Dr. Tracy Davis, noted that the forecast must be viewed in the context of an increasingly volatile environment shaped by geopolitical tensions, climate phenomena, animal diseases, changing trade conditions, and rising compliance costs.

Davis stressed the need to look beyond current market fluctuations and determine the fundamental direction of the sector's development. She also questioned how this direction could be influenced, changed, and how growth potential could be maximized in the future.

Despite the challenges, agriculture demonstrates resilience. Between 2011 and 2025, the sector grew at an average rate three times faster than the entire economy, even with weak economic development and repeated shocks.

Crop production is expected to face significant short-term pressure following a strong cycle of production and prices. Commodity prices have dropped sharply while high resource costs narrow profit margins. BFAP forecasts that some of the acreage expansion achieved during the high-price period will be reversed, although only about half of the nearly 700,000 hectares added is expected to be lost.

Yield increases in crops such as maize, soy, sunflower, and rapeseed have helped producers remain viable at lower prices. Davis linked this growth to the adoption of conservation agriculture, irrigation, precision technologies, investment in machinery, and improved seed varieties. Most major cereal crops have also transitioned to being net exporters. According to Davis, future growth will increasingly depend on productivity, as acreage expansion remains relatively stable, and commodity prices are expected to rise slower than inflation.

Sugar remains under pressure due to a significant reduction in planting area over the last decade. BFAP expects stabilization at a lower level, while bioenergy may provide an alternative source of demand.

According to Davis, livestock prospects are more positive due to reduced feed costs, which improves profitability. International meat prices have also risen: the FAO meat price index is up 18% compared to five years ago and 4% compared to the previous year. Animal diseases remain the main constraint on export growth. BFAP forecasts annual meat production growth of approximately 1.5%–2%, with faster growth possible if disease risks are reduced and access to premium export markets is improved.

Poultry remains the country's largest meat sector and a net importer, although local producers have reduced imports of mechanically deboned meat. The next step, according to Davis, is the transition from import substitution to export. Beef is increasingly moving towards premiumization, with higher-value cuts making up a growing share of exports.

Horticulture remains a key driver of growth: production is expected to increase by over 20%, and exports by approximately 24% over the next decade. Growth will mainly depend on yield improvements, orchard maturation, variety enhancement, and meeting export standards, while water resources and rising input costs remain constraints. Port delays also pose a risk to fruit exporters. With weak domestic consumer demand, export markets will remain crucial for the sector's future growth.

BFAP analyst Khani Baloyi highlighted the importance of including often overlooked farmers in the narrative of sectoral transformation. She noted that over 100,000 households produce for sale, and about two million households engage in subsistence farming, yet much of this activity remains unregistered and undervalued. Baloyi concluded that as a sector, they must better tell the story of transformation.