Agriculture projected to grow in 2023

December 21, 2022

Namibia’s agricultural sector is forecasted to post positive growth next year, driven by growth in  livestock production and expected adequate rainfall in the current Summer season, according to research firm Simonis Storm.

This, however, comes after the sector recorded a contraction of 14.2% year on year (y/y) in 3Q2022 after expanding by 7.8% y/y and 2.0% y/y in 1Q2022 and 2Q2022 respectively.

“La Niña did not bring adequate rainfall to benefit local crop farming and fishing remained constrained for reasons discussed in previous reports.”

Growth during 3Q2022 according to Simonis Storm was supported by cereal (mainly maize) production, up  35.2% y/y and milk production up 4.8% y/y, whereas fish landings were down 33.0% y/y and grains milled down 45.0% y/y.

Local livestock slaughtering, according to Simonis Storm, remains fairly muted, where cattle slaughtering increased by 1.0% m/m, sheep slaughtering was down 1.3% m/m), pigs up 13.7% m/m and goats down 15.1% m/m in November 2022.

“Regarding exports, cattle live exports decreased by 17.6% m/m, sheep up  83.2% m/m and goats down 33.1% m/m in November 2022. On an annual basis, live exports also decreased for cattle  by 1.4% y/y, but increased for both sheep by 59.5% y/y) and goats 2.7% y/y. 

“Main export destination remains the usual markets, namely the EU (45.4% of total exports), South Africa (21.0%) and Norway (12.8%). Marketing activities in the sheep sector improved considerably in November 2022 due to pent up demand following the ban on animal movements to South Africa in 3Q2022.”

The sheep sector has emerged as the best performing sub-sector during 2022 thus far.
“YTD cattle marketing activity increased by 4.2%, whereas sheep marketing increased 43.2% and goats marketing increased by 25.3% compared to the same period last year (January to November).”

After spiking in August 2022, fish exports have declined for a second consecutive month in October 2022 according to the research firm.

“The value of fish exports increased by 14.9% y/y in October 2022, compared to 0.1% y/y in September 2022. On a monthly basis, fish exports decreased by 5.3% m/m in November 2022, compared to -1.8% m/m in September 2022. YTD, the value of fish exports is marginally above the value of exports recorded in the same period last year (January to November), being only 1.7% higher in 2022 than in 2021.”

“YTD, fish exports account for 12.5% of total exports on average, making this a crucial export earner for Namibia. With local fishing companies already operating at Total Allowable Catch (TAC), the quantity of fish exports remains limited and will be limited for the foreseeable future. 

“Hence pricing is the only way to increase the value of fish exports and so export earnings. While the weaker USD/ZAR exchange rate has had a positive impact on export earnings, the value of fish exports could be stagnant or slightly decrease as we expect a stronger Rand exchange rate going forward.”

The Bank of Namibia forecasts the domestic economy to grow 3.9% in 2022 before moderating slightly to 2.7% in 2023, higher than 2.8% forecasted by Finance and Public Enterprises Minister Ipumbu Shiimi in his October Mid-Year Budget Review for 2022 and 3.4% for 2023.

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Last modified on Thursday, 29 December 2022 14:21

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