Star 2024-01-09

RUNNING generators for irrigation and pack house operations costs agribusinesses six times more than the price of Eskom electricity. Countering load shedding is coming at a huge costs for the agricultural sector, says Absa AgriBusiness. In a recent interview with Business Report, the banking unit’s senior economist, Dr Marlene Louw, said the perishable nature of agricultural commodities made the supply of energy at the right times important. She said rolling blackouts affected the whole value chain and ecosystem. “It presents risks in terms of production volumes, quality and costs. Producers have, where possible, to a large extent invested in back up energy capacity and renewables to offset some of the risks,” Louw said. Louw said the protection of the cold chain through to the retailers was important. The South African…

The country’s business activity index has risen above the neutral 50-point mark in December to reach 51.4 points BUSINESSES in South Africa’s manu- facturing sector remain optimistic about trading conditions in the next six months as confidence rose to its highest level in nearly a year, due to hopes of easing logistical and electri- city challenges. This comes as manufacturing activity in South Africa ended 2023 on a positive note, rising for the first time in eight months in December on the back of less rotational power cuts after Eskom suspended load shedding during the festive season. The Absa Purchasing Managers’ Index (PMI), which was released yesterday, closed the year on a somewhat stronger footing and rose by 2.7 points to 50.9 index points in December after having stayed…

THE HOUSING market was tough in 2023 as many estate agents saw a 25% to 30% decline in sales and 2024 looks equally challenging, RE/Max of Southern Africa CEO and regional director, Adrian Goslett, said yesterday. “That doesn’t mean there aren’t opportunities to be found or success to be made in the year ahead,” he said in a statement. For example, he said that in “one of the toughest years we as an industry have faced within the last 10 years or so”, and despite the high interest rate and other economic factors, RE/Max’s network grew by more than 250 agents, while more than 20 new franchises were opened. Goslett said 2024 would likely be another challenging year and real estate agents would have to continue to work hard to…

THE AGRICULTURAL sector is bracing itself for a tough year as many of the challenges that impacted it last year remained unresolved while the uncertainties around El Niño loomed large. In a recent interview with Business Report, Agricultural Business Chamber (Agbiz) CEO, Theo Boshoff said the sector experienced good agricultural conditions in the past year; but business confidence was low due to external factors such as logistics, energy, and animal diseases among others. “Agricultural conditions are set for a downturn, so it will be a challenging year ahead. Be that as it may, we hope the work put in by organised business over the past two years to reform our energy and logistics sector will start to yield benefits,” Boshoff said. He said that as always, there were parts of…

FINANCIAL markets locally and glo- bally recovered strongly during November and December. The announcement by the Federal Reserve (Fed) on November 14, 2023, that the Fed would probably lower its bank rate by at least three times in 2024, as well as the increase in US unemployment in November, boosted share and bond markets worldwide. South Africa followed the bullish momentum to the end of 2023. However, growing concern of the effect of high interest rates during 2023 on the US economy turned equity markets around strongly since January 2, 2024. As a result, the rand exchange rate remains under pressure, trading between R18.30/$ and R18.80/$. On the JSE, the Alai gained 5 260 points from November 13, 2023, to December 31. This is an increase of 7.3%. The…

UNCERTAINTY over policy decisions in South Africa is forecast to continue to permeate throughout the economy due to a plausible wide range of 2024 election outcomes on the back of bleak growth in 2023. These are the findings of the North West University Business School Policy Uncertainty Index (PUI) for the fourth quarter of 2023 which was released yesterday. Although remaining well in nega- tive territory, the PUI showed a welcome easing to 65.5 points in the fourth quarter from 71.8 points in the third quarter (baseline 50 points). North West University said while negative factors shaping the PUI were still strong enough to keep the index highly elevated, there were enough positive factors to slightly reduce the PUI level in the fourth quarter. The PUI highlighted…