South Africa’s farming sector may need up to 18 billion rand ($1 billion) over the next three years in financial assistance to recover from a devastating drought, industry group Agri SA said on Wednesday.
Agri SA executive director Omri van Zyl told a grain producers’ conference that much depended on late summer rains as the growing season for the key maize crop nears its end.
“If we get enough rain now it would be about 6 or 7 billion rand. The medium-range scenario is about 12.5 billion rand,” he told Reuters on the sidelines of the conference.
Forecasts are still calling for the dry weather to persist into the southern hemisphere autumn in April and May.
“A lot of that money would be for feed and livestock farmers and loan subsidies for farm workers’ wages so we don’t lay off workers. And a lot of it would be production credit for the next season,” he said.
The money would likely have to be sourced from the banking sector and other financial institutions, he said.
“Preferably it should come from the government because they should provide for this kind of stuff in a contingency reserve. But obviously they don’t have that,” he said.
South Africa’s diverse agricultural sector, from grains to livestock, has been hard hit by a scorching drought which has been exacerbated by a powerful El Nino weather pattern.