At the start of this month, the Agricultural Business Chamber of South Africa (Agbiz), where I work, released the third-quarter results of the Agbiz/IDC Agribusiness Confidence Index (ACI).

This sentiment indicator tracks the agriculture and agribusiness sector in South Africa. The third-quarter reading was positive, with the ACI up eight points from the second quarter to 53.

The current ACI level indicates that South African agribusinesses are optimistic about business conditions.

This quarter, optimism was strongest among respondents in the financial services sector, grain traders, input suppliers, and the feed industry. Meanwhile, the other respondents maintained their views from the last quarter.

This reading is unsurprising and reflects a sector ending a period of abundance, with ample harvests of grain, oilseed, fruits, and vegetables because of the favourable rainy season in the 2025-26 production year. Even the second-quarter export figures show the large harvest has been highly beneficial.

Trade gains

Looking at the agricultural trade figures, the first half of this year has clearly been a period of excellent performance. For example, after solid export activity in the first quarter of the year, South Africa's agricultural exports totalled $4.1 billion in the second quarter of 2026, up 10% from the same period a year ago. This again reflects both higher export volumes of various products and better commodity prices. For the first half of 2026, South Africa’s agricultural exports amounted to US$7.8 billion, up 11% from the first half of 2025.

The products that dominated the exports list in the second quarter of 2026 were mainly citrus, apples and pears, maize, wine, dates, figs, pineapples, avocados, guavas, mangoes, wool, sugar, fruit juices, grapes, and nuts, among other products.

Admittedly, we remain with some logistical challenges that various organisations have raised. Still, performance has improved overall in some areas. Clearly, while there remains a need for further improvement in port efficiency, particularly at the Port of Cape Town, which has posed challenges for agricultural export industries, there has been material improvement in other ports, such as the Port of Durban and the Eastern Cape ports, compared to recent years. Agricultural export activity in the second quarter experienced less friction than in the recent past.

South Africa also imports various agricultural products. In the second quarter of 2026, South Africa’s agricultural imports totalled $2.0 billion, a 12% increase year on year. This reflects slightly higher value and volume of major products South Africa imports, such as wheat, palm oil, poultry, and whisky. For the first half of 2026, South Africa’s agricultural imports amounted to $3.9 billion, up 5% from the first half of 2025. South Africa lacks favourable climatic conditions for growing rice and palm oil and thus relies on imports of these products. Regarding wheat, South Africa imports nearly half of the annual consumption. Meanwhile, imports account for around 20% of the annual domestic poultry consumption.

Subsequently, when we account for exports and imports, South Africa’s agriculture sector recorded a trade surplus of $2.1 billion in the second quarter of 2026, up 9% from the previous year. Higher exports drove this improved trade surplus.

The Path Ahead is Challenging

But this optimism should not be read as a reflection of the sector’s outlook. There remain risks going into the 2026-27 season. Higher input costs on the back of the United States-Iran war, combined with a potential El Niño-induced drought, remain farmers’ major concerns.

In fact, respondents to the ACI survey highlighted these risks and flagged export risks because of rising geopolitical tensions worldwide. Therefore, the optimism we observe in the sector reflects current conditions supported by the favourable production season in the 2025-26 season that we are leaving behind, but the path ahead remains uncertain.

In addition to unfavourable climatic conditions and higher input costs, geo-economic tensions are another challenge for South Africa's export-oriented farming sectors.

These are issues we must consider as farmers approach the new season, 2026-27, from October onwards. They will not enjoy the favourable conditions of the past season, and their sentiment report should not be read as if they aren’t concerned about the sector's path ahead; they certainly are. Their optimistic mood merely mirrored the abundance we are leaving behind as we embark on an uncertain season ahead.

Wandile Sihlobo is the presidential envoy on agriculture and land. He is also the chief economist of the Agricultural Business Chamber of South Africa and a senior research fellow in the Department of Agricultural Economics at Stellenbosch University.