Goldenveld Grain (Pty) Ltd Business Plan › Section 3 › Macroeconomic Context

3.1 South African Economic Overview

South Africa’s real GDP expanded by 1.1 per cent in 2025, marking the strongest annual growth since 2022 and an improvement from the 0.5 per cent recorded in 2024. Growth was driven primarily by the services sector, trade and hospitality, and a resurgent agricultural sector. The National Treasury has set a medium-term growth target of 2.0 per cent by 2028, with a budgeted ZAR 2.67 trillion for the 2026/27 fiscal year to support infrastructure, energy reform, and economic development.

The agriculture, forestry, and fishing sector was the standout performer of 2025, recording a remarkable 17.4 per cent year-on-year expansion and contributing ZAR 134.8 billion to GDP. This represented an increase of approximately ZAR 20 billion from 2024 and a sharp reversal from the contractions of 4.6 per cent and 8.7 per cent in 2023 and 2024, respectively. Growth was underpinned by favourable rainfall, strong field crop and horticultural output, and record agricultural export revenues.

3.2 Agricultural Sector Significance

Primary agriculture contributes approximately 2.8 per cent to South Africa’s GDP directly, while the broader agricultural value chain, encompassing processing, logistics, and retail, accounts for roughly 14 per cent of the country’s ZAR 7.34 trillion GDP (2024 figures). The sector supports an estimated 950,000 direct jobs and substantially more through indirect and induced employment.

South Africa’s total agricultural exports reached a record ZAR 268.7 billion in the fourth quarter of 2025, representing 9 per cent year-on-year growth. Africa remained the largest export destination at 53 per cent of agricultural exports, followed by Asia and the Middle East (17 per cent) and the European Union (16 per cent). The agricultural trade surplus widened to ZAR 24.6 billion, underscoring the sector’s strategic importance to the balance of payments.

3.3 Policy and Regulatory Environment

The regulatory framework governing wheat production includes the Marketing of Agricultural Products Act (which governs commodity levies and market information), the Conservation of Agricultural Resources Act (CARA), and the variable wheat import tariff administered under the Price Band System. The import tariff is designed to provide a floor level of protection for domestic producers when global prices decline below a reference threshold, though industry participants have noted that tariff adjustments are sometimes implemented with delays.

The South African government has signalled continued support for agricultural modernisation, with Minister of Agriculture John Steenhuisen emphasising the sector’s role as a driver of job creation, export revenue, and food security. Recent bilateral discussions with Kuwait have explored expanded agricultural investment and trade cooperation, while BRICS+ agricultural exports grew 31 per cent in 2025.

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