COVID-19 interrupts Southern Africa, USA agricultural trade slashing it by 17% in 2020

SOUTH AFRICA – The bullish Southern Africa and United States agricultural trade which has always ranged from US$983 million to about US$1.7 billion per year, since 2010 was severely impacted by the COVID-19 pandemic.

Due to the disruptions and measures implemented to address COVID-19 such as lockdowns, agricultural trade between the counties declined by 17% to US$1.4 billion in 2020, from US$1.6 billion in 2019.

According to a GAIN report by USDA, U.S agricultural exports to Southern Africa were the most affected decreasing by 23 percent to US$483.7 million in 2020, from US$625.1 million in 2019.

The decline was mainly caused by the domestic restrictions on liquor sales and imports which resulted in declines in alcohol beverages, mainly whisky and ingredients used in the manufacture of alcoholic beverages i.e., hops, malt, and grain sorghum.

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South Africa also had a record season for grains in 2020, which resulted in declines in imports of wheat and corn seed.

Further to that, the economic impact of COVID-19 to Southern African countries also resulted in decreases in demand for chicken, wheat, and beans from Angola; soybean oil, wheat and corn flour from Mozambique; and chicken from South Africa.

On the flip side of the situation, U.S agricultural exports to Zimbabwe, Madagascar, Eswatini, Namibia, and Lesotho grew in 2020.

U.S agricultural exports to Southern Africa decline by 23% while its imports dwindled by 13%

In terms of products chicken cuts and its edible offal were the leading Southern Africa imports accounting for 30 percent of the total exports in 2020, followed by animal feed preparations (8 percent), soybeans (5percent), wheat (4 percent), almonds (4 percent) and food preparations (4 percent).

South Africa was the leading importer from the U.S during the year, accounting for 73 percent of the total exports to Southern Africa, followed by Angola (18 percent), Zimbabwe (2.4 percent), Madagascar (2.1 percent), Eswatini (1.5 percent), Namibia (1.0 percent), Mozambique (1.0 percent), Mauritius (0.7 percent) and Zambia (0.1 percent).

In comparison, Southern African exports to the United States only decreased by only 13 percent to US$883.2 million in 2020, from US$1 billion in 2019.

This was due to more stringent measures that were placed on imports of liquor products by some countries, disruptions to supply chains, and decrease in demand due to low economic activities and consumer incomes as a result of COVID-19.

This decrease was only from three countries, Madagascar sending out cocoa beans and vanilla, Mauritius exporting tuna and Lesotho selling vegetable products.

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Despite the COVID-19 pandemic, agricultural exports from South Africa, Mozambique, Zimbabwe, Eswatini, Namibia, Zambia, Angola and Botswana were more resilient and increased in 2020.

Madagascar, South Africa and Mauritius accounted for 92 percent of the total exports.

The main commodities imported by the United States from the region include vanilla (33 percent), citrus (11 percent), seafood (9 percent), cane sugar (8 percent), macadamia nuts (8 percent), and wine (6 percent).

Most products traded abroad are considered health foods, hence their resilience and continued trade due to rising demand driven by health reasons during COVID-19.

The report expects improvements in agricultural trade in 2021, based on several countries lifting lockdown restrictions, improved management of supply chains, and increases in production of major crops following good rainfall received to date.

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