Towards an Integrated Agricultural Growth Path for South Africa

Policy Paper 49 South Africa’s agricultural sector has delivered strong productivity growth and export performance over the past three decades, reflecting a growth path that is predominantly export-led, technology-enabled, and anchored in high-value value chains (notably horticulture and livestock). Yet this trajectory has been accompanied by persistent structural dualism, limited broad-based inclusion, and a weak transmission of growth into labour absorption in a context of chronically high unemployment. While the commercial core has deepened its competitiveness, a large share of rural households remains confined to low-productivity farming and survivalist self-employment, with limited integration into dynamic value chains. The paper argues that the core policy challenge is no longer whether the existing commercial sector can “grow”, but whether the growth path can be broadened to (i) expand labour-absorbing production, agro-processing, and allied rural services, (ii) diffuse technology, capabilities, and market access beyond the top tier of producers, and (iii) remove binding constraints (logistics, energy, biosecurity, and institutional capability) that increasingly threaten competitiveness. Building on evidence from South Africa’s recent policy architecture (notably the National Development Plan 2030 and the Agriculture and Agro-processing Master Plan), the paper proposes an integrated growth trajectory centred on bringing an additional 2.5 million hectares of state-held underutilised land into effective production, while strengthening pathways for smallholders and new farmers – including through self-employment and enterprise development – to participate in higher-value markets. This includes de-risked finance, targeted infrastructure, and capable market institutions. The paper further highlights the role of social enterprise models as platforms for skills formation, youth transitions, and the development of hybrid employment pathways spanning farming, agro-pr