As with the rest South Africa, farmers woke up this morning facing a hefty fuel price increase of R7.37/l and R7.51/ for the 50ppm and 500ppm grades of diesel, respectively. This brought the diesel pump prices to R25.91/l (0.05% sulphur) and R26.11/l (0.005% sulphur). The two grades of petrol rose by R3.06/l to R23.36/l (95 ULP) and R23.25/l (93 UL & LRP).
However, farmers have been spared from a much steeper fuel hike after the joint announcement by Ministers of Finance and the Department of Mineral and Petroleum Resources of a temporary levy reprieve of R3/l from Wednesday 1 April 2026 to Tuesday 5 May 2026. It is further envisaged that a broader package of support measures to households and key sectors of the economy are being developed. This is obviously good news given the potential negative impact of a prolonged war on agriculture profitability and food security for the country.
Fuel is critical in planting and harvesting in the grains and oilseed industry, accounting for approximately 13% of input costs. In farm logistics, fuel is central to moving agriculture produce and various inputs to and from markets and suppliers, respectively.
While the levy cut provides some relieve, the hike still places profit margins under pressure as higher input costs are not met by the corresponding increase in agriculture commodity prices due to the hefty domestic and global supply outlook. For example, average maize prices for March 2026 were down by a whopping 41% and 28% y/y at R3,288/t and R3,413/t for the white and yellow subcategories, respectively.
While farmers are price takers with limited ability to pass on added costs, the consumer will face increases on various food commodities due to distribution and associated costs of landing the products for consumption.
