The 2026 Medium-Term Budget Policy Statement (MTBPS) again reminded us of the challenging macroeconomic conditions we face, with the South African economy set to grow only 1,2% in 2026, down from the 1,6% projected in February, as geopolitical developments continue to weigh.

“Still, the focus of the MTBPS was on the key aspects that agribusinesses view as priorities. The increased focus on infrastructure matters and the effectiveness of municipality operations is a welcome development. Many of our members continue to face constraints in business activity and rising costs because municipalities fail to be effective. We see such failures also clearly with Fresh Produce Markets that need improvement across our country,” says Theo Boshoff, CEO of the Agricultural Business Chamber of SA (Agbiz)

“The statement also comes at a time when agriculture is approaching a challenging season in the 2026/27 period because of the El Niño drought. Thus, we welcome increasing the contingency reserve to R10 billion to respond to potential threats from El Niño and other risks. The Department of Agriculture, among others, will need to closely assess the impact of El Niño in the sector in 2027 and tap into these resources to help the most affected farmers in the sector,” says Wandile Sihlobo, Chief Economist of Agbiz

Boshoff added: “The fuel relief is also another important aspect currently, as the agricultural season is underway. Agribusiness moves a lot of agricultural and food products across the country during the year, so the fuel relief is something we welcome. About 80% of South African agricultural products are transported by road.”

“As South Africa releases more state land and refocuses on the implementation of the Agriculture and Agro-processing Master Plan, we also need to increase the capacity to assist the new entrant farmers,” says Sihlobo. “Thus, we view the additional R1,5 billion over the next three years for additional extension officers in the agricultural sector as positive.”

Overall, Agbiz views the MTBPS as balanced, and it touches on key areas critical for the South African farming sector and agribusinesses.