The agriculture sector recorded a 3% and 1.6% growth in first and second respectively, lagging far behind overall GDP growth rates of 6.5% and 5.6% in the same quarters last year, latest figures from Simonis Storm reveal.
Theo Klein, economist with the research firm said that the slowdown in the sector was due to all sub-sectors recording lower growth rates in the second quarter.
Crop and fishing contributed most to the overall slowdown.
He said the value of fish exports decreased by 10.9% year-on-year in August 2022, compared 10.3% year-on-year in July 2022.
‘’The La Nina phenomenon is expected to bring above average rainfall in the Summer season in Southern Africa. It remains to be seen whether this time round, all crop growing areas in the northern part of Namibia will receive sufficient rain at the right time. Sporadic rain that led to late, insufficient or excessive rain in various parts of the North has negatively impacted on crop production,’’ he said.
The agriculture sector accounts for 10.1% of GDP in the first half of 2022 and employs about 23% of all employed Namibians according to the latest available Labour Force Survey from 2018.
He said the sector is forecasted to expand by 2.7% over the next three years when taking an average of local forecasts.
‘’One positive development for the crop sector would be the Daures Green Village pilot project north
of Swakopmund. This is a green hydrogen pilot project headed by UNAM and other European universities. At an estimated cost of USD15.1 million, this project aims to produce 500kg of Anhydrous Ammonia per day. The project will also establish a green scheme program to be used by the local community making use of ammonia-based fertiliser. With Namibia being a net fertiliser importer, we believe the local crop sector can benefit from locally produced fertiliser,’’ he explains.
Meanwhile, local livestock slaughtering remains on a downward trend since April 2022, where cattle
slaughtering decreased by 23.8% yearly, sheep by 14%, goats by 96% and pigs by 2.9% in September 2022.
On the other hand, Simonis notes that live exports are still significantly higher compared to exports a year ago. Cattle exports decreased by 34.5% year-on-year, sheep is up 48.9) and goats also increased by 33.39% year-on-year in September 2022.
“A ban of livestock movement in neighboring South Africa during the third quarter also put a dent on
the performance of live exports at a time when demand from feedlots for the festive season washigh,” according to the Meat Board.
Globally, Klein said that livestock prices are on a downward trend due to reduced demand from China.
‘’This has created a stockpile in various parts of the world and could further weigh on prices for the remainder of 2022. Prices have also decreased in Australia, Brazil and the EU. This should assist in lowering food price inflation in Namibia during the fourth quarter,’’ he said.
The value of fish exports decreased by 10.9% year-on-year in August 2022, compared to -10.3% year-on-year in July 2022.
‘’On a monthly basis, fish exports increased by 8.8% month-on-month in August 2022, compared to -27.9% month-on-month in July 2022. Year to Date the value of fish exports is marginally below the value of exports recorded in the same period (January to August) last year,’’ said Simonis in their Agri-monthly report.