top of page

The Agriculture paradox in South Africa 
 How a small sector powers jobs, food and trade

Helvetica Light is an easy-to-read font, with tall and narrow letters, that works well on almost every site.

Key Takeaways:

  • Agriculture contributes just 2.4% to South Africa’s GDP, but it was essential in preventing the economy from contracting in the first quarter of 2025.
     

  • Agriculture supports rural livelihoods, employing 17% of rural workers and reducing poverty more effectively than any other sector.
     

  • South Africa's food security relies on essential grains. South Africa produces enough maize to feed the population, but relies on imports of other grains, such as wheat.
     

  • South Africa is a global leader in fruit exports, with citrus, grapes, and wine making agriculture one of the country’s top export earners.

South Africa's agriculture sector is a small but essential contributor to GDP

In the first quarter of 2025, South Africa's economy narrowly avoided contraction, recording a mere 0.1% growth. This fragile figure was buoyed almost entirely by the performance of one sector: agriculture. Without it, the economy would have shrunk. This moment highlighted a long-standing paradox in South Africa’s economic structure: although agriculture's contribution to GDP is modest, it is one of the most vital industries in the country.

​

Over the past several decades, agriculture’s GDP contribution has hovered around 2.5%, despite South Africa having enormous swathes of farming land (although only 11% of this land is arable land, while the rest is used for grazing). South Africa has the second highest amount of farming land on the African continent, but agriculture's contribution to GDP is one of the lowest. In 2024, for instance, agriculture contributed R111.9 billion to a total GDP of R4.66 trillion, amounting to just 2.4% of GDP.

​

This has to be seen in the context of South Africa's economy. South Africa is a service-oriented economy: in 2024, Business and Financial Services made up 25% of South Africa’s GDP, while Personal Services accounted for another 16%. Most South Africans also live in urban areas, and as people move from rural to urban areas, the proportion of those employed in agriculture falls.

1.png
2.png

However, even when compared to other developing countries, South Africa stands out. Among BRICS nations, South Africa still has one of the smallest agriculture sector contributions to GDP. In 2023, it stood at 2.62%, far below the BRICS average of 10.86%. This may be due to differences in economies: South Africa’s economy is heavily services-dominated, while countries like India have large rural populations that work in agriculture, and Brazil has a massive agri-processing sector exporting key crops globally. China is one of the world’s largest producers of maize, rice, wheat and vegetables, among others. South Africa is also one of the driest countries in the world, and much of the farmland is rain-dependent.

3.png

This introduces the core paradox: despite its small contribution to GDP, agriculture is one of South Africa’s most essential industries. It anchors rural employment, supports millions through food production, and drives valuable exports.

Agriculture production is tied to food security

Although South Africa is food secure on a national basis, food security in South Africa is deeply tied to local production. For instance, a dry spell in early 2024 led to reduced maize yields, which in turn caused a spike in grain prices—up 7.3% in one season. These increases hit low-income households hardest. When maize production suffers, so does national food access.

​

Maize is the most critical grain to ensure food security in South Africa. It is the most widely grown crop and the staple food for most of the population. Over time, maize production has shown steady growth, thanks to improved farming practices and supportive policy. At the same time, other key crops, such as grapes and oranges, have grown both in volume and in export significance.

​

Wheat, on the other hand, tells a different story. Production has stagnated, and the country remains heavily reliant on imports to meet domestic demand. This makes South Africa vulnerable to global price fluctuations and supply shocks.

9.png

The steady growth in maize means that South Africa is self-sufficient in maize: the country regularly produces enough to meet domestic needs and export the surplus. However, this is not true for wheat. Wheat’s self-sufficiency ratio remains below the self-sufficiency line, revealing a dependence on imports. 

10.png

South Africa is careful not to export at the expense of local consumption, and exporting agricultural products creates employment and revenue for the country. Policymakers have argued that, despite these checks, food security for low-income households will remain tenuous until the economy grows and employment opportunities are created. 

Agriculture is a crucial employer in rural South Africa

Agriculture employs approximately 914,000 people in South Africa, or 5% of the employed population. Though this may seem small, agriculture plays an outsized role in rural areas, where job opportunities are scarce. 

4.png

In urban metros like Cape Town, Johannesburg, and Durban, employment is dominated by Services and Retail. In contrast, agriculture stands as one of the few viable industries in rural areas. 17% of rural South Africans work in Agriculture, making it the third-largest employer in non-metros after Community and Social Services and Retail. In contrast, only 2% of people employed in urban areas work in the Agriculture sector.

5.png

The impact of agriculture goes beyond employment numbers. Agriculture plays an outsized role in poverty reduction and economic development, especially in rural areas. Studies show that agricultural growth is up to 3.2 times more effective at reducing poverty than growth in any other sector. A 1% increase in agricultural GDP can boost spending among the poorest 10% by as much as 6%. Simply put, agriculture is a lifeline in parts of the country that the rest of the economy often overlooks.

South Africa is a key global fruit exporter

Beyond local food security and employment, agriculture is a major force in South Africa’s global trade. In 2024, South Africa's agricultural exports hit a record high of $13.7 billion, a 3% increase on exports in 2023. Oranges, maize, grapes, apples and wine were the top agricultural goods exported from South Africa in 2024. South Africa is the third-largest exporter of oranges in the world, behind Spain and Egypt. 

6.png

Production of key fruits has steadily increased. Grapes and oranges, in particular, have seen long-term growth and now form the backbone of the country's high-value exports.

7.png

In 2024, fruit and nut exports ranked as South Africa’s 7th largest export category, ahead of electronics and aluminum. South Africa exports over 60% of its fruit production, and fruit production alone supported 330,000 on-farm jobs in 2024. This illustrates the sector’s economic significance far beyond its modest GDP footprint.

8.png

Agriculture matters more than GDP shows

The South African economy tends to treat agriculture as a small sector, and by GDP standards, it is. But when we look deeper, agriculture supports:

​

  • Nearly a million jobs

  • The country’s most vital food staples

  • One of the most valuable export streams
     

This is the paradox: a small sector by GDP, but a giant in its impact on people, food, and trade. To ignore agriculture because of its GDP size would be a mistake. To empower it would be a national investment in inclusive, sustainable growth.

References:

Decoding Impact

Disclaimer: The views and opinions expressed on this blog are my own and do not reflect those of my employer. I blog in my personal capacity, and my content is not affiliated with my workplace.

LinkedIn

Share article

bottom of page