By Dawie Maree, Head of Information and Marketing at FNB Agriculture
Some people might think the agricultural industry is a struggling industry when you listen to commentary on public platforms. However, when you visit an event like Nampo, one gets another view – a much more positive view. The official numbers, as reported by Stats SA, still show that the primary industry contributes around 2.6% to GDP, however if one takes the value chain into account, the value of the industry is estimated to be closer to 15%.
Primary agriculture’s relatively small contribution to the economy is not unusual given the state of development of the South African economy. Looking at employment, one will also realise the importance of the industry – the sector employed 888 000 people in the first quarter of 2023, and that is 27 000 more than the last quarter of 2023. Post Covid, agriculture was also one of only four industries that could recover and grow to levels higher than pre-Covid. This is something to be proud of.
It is surely not all moonshine and roses. The industry, especially exporters of fruit struggled the last couple of years with very high shipping costs, ineffective ports, and deteriorating infrastructure. Livestock producers had to deal with the outbreak of foot-and-mouth disease, avian influenza and African Swine Fever, limited supply of vaccines and high feed prices. Grain farmers experienced three excellent years in terms of production conditions and relatively high commodity prices, but also had to be content with high input prices for fertilizers, chemicals, and seed. And across the sector, everyone, including our consumers, had to deal with high fuel prices and of course loadshedding.
Given the nature of FNB Agriculture’s business and the fact that agriculture is an important sector for FNB Commercial, we value our involvement at Nampo and our commitment to the industry, from small-scale farmer to mega-farmer and from input supplier to trader in agricultural commodities and processors of the products that our farmers produce. Nampo increased in popularity over the last decade and, apart from the two Covid years, attendance numbers as well as exhibitors confirmed that.
But why is it so popular, not only with farmers but also to the wider public? Farmers can get the latest technology trends and reliable information directly from suppliers. They can compare, and in some instances even test different products that are available. With agriculture becoming more and more dependent on technology, it is important for farmers to do these comparisons themselves and not just rely on the salesperson coming on the farm. Producers planning to do replacement purchases will benefit from Nampo, since most machinery manufacturers run special offers during the Nampo week, or even longer. Apart from seeing the latest technology, getting the relevant information, and saving some money, it is also an opportune time to rub shoulders with fellow farmers from across the country to get even better insights.
Nampo is not only beneficial for producers, but exhibitors also benefit. They get direct feedback from producers and can engage with numerous people about the industry. The general public can benefit just as much at these events. It is the ideal event to inform the public regarding developments in agriculture, to teach children more about the importance of the sector, where food comes from, how it is being produced and processed up to the point where the consumer buys it in the supermarket. It is also an excellent showcase that studying agriculture is not just about farming – there are vast opportunities in the industry, e.g., genetics, soil scientists, IT specialists in geo-information services (GIS), app developers and a lot more.
Companies can showcase their achievements and interact with a large number of their clients and stakeholders on a more informal basis that will benefit all in the longer term. In agriculture, relationships are far more important than just a business transaction. Obviously then it will then also be important for financial service providers to be part of events such as Nampo.
For FNB, the relationship with the farmer is crucial. It is therefore important for the Bank to also be up to date with the latest trends and technology in the sector. In this way the relationship manager knows what is going on when a credit application is received or reviewed, he will know what the farmers refers to if he speaks about CA (conservation agriculture), yield optimization, etc. and in the end, he can serve the client better.
Another spin-off is the benefit to the local community and economy of a rural town like Bothaville. More or less the whole community is involved in Nampo for the week, either through food stalls by the local churches, accommodation in guest houses or just general arrangements within the town. One can just imagine the financial injection a rural town can get from having an event such as Nampo. The start of rural development.
In the end the success of Nampo, or for that matter any other agricultural event, will be when anyone who attends it, from farmer to supplier, starts thinking differently about their business and start making changes to actively improve their business to be financially sustainable, even in tough times. A successful agricultural industry is still the backbone of any economy.
