Friday, February 3, 2023

Agbiz continues to engage with Eskom on load shedding challenges

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Estimated reading time: 2 minutes

The severe load shedding has increased food security risks in South Africa (SA), and financial pressures on farmers, agribusinesses and value chain role-players. While the risk is great, statements on food security should only be made based on evidence.

As such, Agbiz conducted a survey this past week across all the sectors and the results are currently being analysed by a joint team of experts. Insights will be shared as soon as possible. The survey will also be used to inform possible interventions that government and private sector representatives are formulating to ensure a sound approach. The results of the survey will help enrich the approach to agriculture.

Agbiz has also been engaged in various meetings with the Department of Agriculture, Land Reform and Rural Development, as well as Eskom to find ways to ease the pressure on agribusinesses. These engagements are ongoing and will benefit from the results of the survey.

The effect of load shedding

In the near term, Agbiz has urged for less severe load shedding in areas under irrigation and food-processing facilities. In crucial field crops, roughly 20% of maize, 15% of soya bean, 34% of sugar cane and nearly half of the wheat production are produced under irrigation, which faces severe challenges due to persistently hot and dry conditions, coupled with the constrained ability to irrigate. Fruit and vegetables also heavily rely on irrigation and thus face similar challenges. Similarly, in the dairy industry, aquaculture, red meat, poultry, animal feed manufacturing and piggeries, there are also concerns that load shedding beyond Stage 2 makes operations and planning challenging as these industries all require continuous power for their usual activities.

Read more about the effect of load shedding on crops here.

Agribusinesses face similar challenges in various downstream processing activities, such as milling, bakeries, abattoirs, wine processing, packaging, and animal vaccine production. This means that continued engagements with Eskom to lobby that load shedding does not exceed Stage 2 or 3 are critical for the near term, and to develop contingency plans that allow greater predictability should outages be unavoidable so that companies may plan their operations around a more predictable schedule.

The agricultural sector will also explore the path for renewables, and this might require government’s assistance, subsidies and revisions to the regulatory framework. These are all key points that Agbiz will continue to voice in endearment to the authorities. – Press release, Agbiz

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