South Africa’s agricultural sector is facing a fuel price crisis, with emerging supply constraints in rural areas disrupting farming operations ahead of key production periods. AgriSA and Agbiz have urgently requested a fuel price adjustment due to these supply constraints, warning that the situation could pose risks to food production, supply chains, and food security.
The government is set to announce the April fuel price hikes, which are expected to see increases of around R5 for petrol and R10 for diesel. However, a recent survey of farmers and fuel retailers revealed a more nuanced reality, with reports of constrained fuel availability across multiple regions, and some retailers rationing supply due to uncertainty over replenishment.
Fuel Price Adjustment Proposed
AgriSA and Agbiz have proposed an immediate out-of-cycle fuel price adjustment, alongside more frequent price reviews instead of the current monthly system. They attributed the situation to a combination of global oil market volatility, supply chain pressures, and behavioural responses in the market, rather than a single identifiable cause. According to the South African National Department of Agriculture, Land Reform and Rural Development, fuel typically accounts for between 12% and 18% of agricultural production costs.
The Citrus Growers’ Association of Southern Africa (CGA) has also raised concerns over fuel availability, reporting isolated diesel shortages despite official assurances of stable national supply. The association attributed this to unusual buying patterns and controlled allocation by suppliers. Chief executive Boitshoko Ntshabele emphasized that coordination across the value chain is critical, saying that strong coordination, transparency, and contingency planning will be essential to ensure the upcoming season proceeds with as little disruption as reasonably possible.
Impact on Citrus Exports
With about 95% of the citrus crop transported by road to ports, the CGA warned that limited diesel availability could directly affect the supply chain. As the agricultural sector is a significant contributor to South Africa’s economy, the government must recognize the economic contribution of agricultural exports, noting that South Africa is the world’s second-largest exporter of citrus.
To mitigate the risks, AgriSA and Agbiz have proposed the following measures:
- An immediate out-of-cycle fuel price adjustment
- More frequent price reviews instead of the current monthly system
- Improved coordination and transparency across the value chain
These measures are not intended to increase costs to the sector, but rather to ensure that pricing reflects underlying conditions more accurately, thereby reducing incentives for panic buying or supply withholding.
