Modernising South Africa's agricultural sector through innovation

The government remains committed to finding creative ways of raising gross expenditure on research and development (GERD) equal to 1,5% of GDP by 2030/31, said the Minister of Science, Technology and Innovation during the Department's Budget Vote speech on 23 July 2024.  Tabling the R10,562 billion budget, Minister Nzimande said that increasing local R&D can only be achieved if both the state and private sector increase investments into research, development and innovation.

Achieving the GERD target is possible, particularly when looking at the promising data on local R&D released last week in the South African Agricultural Business Innovation Survey, 2019 – 2021.  The survey indicated that more than two thirds of South African agribusinesses were actively involved in innovation activities between 2019 and 2021.

The survey, conducted on behalf of the Department of Science and Innovation (DSI) by the Centre for Science, Technology and Innovation Indicators at the Human Sciences Research Council (CeSTII-HSRC), shows high levels of innovation in South Africa's agribusiness sector.

The figures were high despite the significant impact of the Covid-19 pandemic on agribusiness innovation.  

The survey covers sectors such as animal and crop farming, forestry, and fisheries, and assesses the extent to which commercial agribusinesses in South Africa have implemented new or improved products and business processes. 

This research was conducted in collaboration with sector stakeholders, including Statistics South Africa.

The HSRC's Dr Yasser Buchana, who led the survey, said these results demonstrate that South African agricultural businesses have shown remarkable resilience in the face of adversity, adapting and innovating their way out of the crisis.

"While there is still room for improvement compared to other countries in the Global North, with the right innovation ecosystem that is supported by progressive sectoral innovation policies, our agricultural sector has the potential to withstand shocks and remain competitive, which is crucial for our country's food security," said Dr Buchana.

Among the key findings, 67,1% of all agribusinesses in the target population engaged in innovation activities.  Innovation activities include all developmental, financial and commercial activities undertaken by a company that are intended to result in an innovation for the company.

Training, acquisition of machinery and equipment, and acquisition of computer software were the top three activities that innovation-active agribusinesses engaged in, according to the survey.

Medium-sized agribusinesses made up the largest proportion of innovation-active businesses (72,9%), followed by large agribusinesses (70,8%).  Small businesses had a moderately lower innovation activity rate of 66,4% while 57,2% of very small agribusinesses were classified as innovation-active.

This significant data will enable the sector to learn more about the evolving national innovation landscape and develop evidence-informed action plans to strengthen the sector.

Agribusiness role players can also use the report and its analyses in ongoing planning for R&D, policy development, industry coordination initiatives and business investments, contributing to the National Development Plan's goal of an agricultural sector that is driven by innovation and modernisation.

CeSTII's Executive Head, Dr Glenda Kruss, says the DSI aims to harness science, technology and innovation (STI) to build a vibrant and economically sustainable agricultural sector, through bio-innovative technologies, products, processes and services that, in turn, will contribute to increased productivity, competitiveness, food security and rural economic development.

"The data provide fresh evidence on the innovation capabilities of firms in the three sectors, which will inform the design of a national agriculture STI roadmap.  The data are equally significant for monitoring the implementation of the government's agricultural, forestry and aquaculture master plans.  We look forward to engaging with policy actors and other sectoral stakeholders to draw out relevant policy evidence and insights from the data," said Dr Kruss.

South Africa's agricultural sector includes both large-scale commercial farms and smallholder subsistence farms, each with varying contributions to food and nutrition security, export performance, employment, and livelihoods.  Agriculture presently makes up about 3% of GDP, 5% of total employment, and 5% of exports.

See the full report

This article was first published on 24 July by South Africa Department of Science and Innovation.