Skip to main content

Farmers lose R14bn as Cape drought bites

| Economic factors

Western Cape farmers have recorded R14bn in losses so far, as a result of the crippling drought in the province, according to Agri Western Cape CEO Carl Opperman.

Farmers have warned that the agricultural sector faces a jobs bloodbath, saying an estimated 50,000 people could be out of work soon.

The poultry sector is also reeling due to the recent outbreak of avian flu, although no new cases have been detected since October 2017.

Cape Town is in the midst of its worst drought in a century and could become the first major city in the world to run out of water.

The drought has forced officials to impose strict water restrictions, and the agricultural sector, which is the largest consumer of water, has had its supply curtailed by between 60% and 87%, Opperman said:

"Both the fruit and vegetable industries have been hard hit by the drought and water restrictions. In the Ceres area, for example, the limited water supply resulted in 50% less onions and 80% less potatoes being planted this season. This impacts on food production and wage losses of millions of rand for seasonal workers."

Consumers should also brace for possible increases in food prices, he said. Hundreds of hectares of citrus trees have been cut back and orchards have been pulled out in a bid to save water. A tomato puree factory in Lutzville said it would not open this season. Opperman said deciduous fruit crops would be about 20% smaller than previous years.

As a result, about 50,000 seasonal workers would receive income that was lower than normal, or no income at all.

Red meat producers were also expecting heavy losses, said Opperman. "No more roughage is available in the Western Cape — this also puts pressure on the dairy sector. Grazing and feed shortages resulted in massive culling, causing local red meat supply to tighten, and meat price increases as a result of the drought-induced shortages."

Opperman said that 5% of livestock and 22% of sheep herds had been slaughtered in the Western Cape so far due to the drought.

However, Opperman said the sector had received a lot of support from the provincial government, which was doing everything possible to assist emerging and commercial farmers in the region.

Pin It

Related Articles

By: Yogashen Pillay – The Mercury Economists are predicting a big drop in petrol and diesel prices next month, saying it will bring much-needed relief to under-pressure consumers.
By: Jason Woosey - IOL Petrol and diesel prices are set to come down from Wednesday, June 5, according to a statement released by the Department of Mineral Resources and Energy (DMRE).
By: Opinion – IOL Business Report South Africans have been collectively waiting with bated breath for some small financial reprieve from the relentless price hikes of the past few years that have driven them to the brink of despair, chief among t...
Stats SA reports that retail trade sales increased by 2.3% year-on-year in February 2024. The largest contributor to this increase was general dealers (6.4% and contributing 2.8 percentage points).
By: Shaun Jacobs – Daily Investor Funding the government’s National Health Insurance (NHI) scheme would require a 31% increase in personal income tax, or a 6.5% increase in VAT, or a ten times increase in payroll tax, threatening South Afric...