September 5, 2023

Impact of Loadshedding on the Western Cape Agricultural Sector

Loadshedding, the controlled rolling blackouts implemented by Eskom, South Africa’s state-owned electricity supplier, has cast a shadow over the Western Cape’s agricultural sector.  A report by the Bureau for Food and Agricultural Policy (BFAP), commissioned by the Western Cape Department of Agriculture, examines the far-reaching consequences of these power disruptions on farming and agri–processing.

The Western Cape relies heavily on electricity for its agricultural and agri-processing activities, consuming about 2 TWh in 2022. Livestock operations and irrigation are major consumers, with over 90% of producers dependent on Eskom. Loadshedding’s impact is driven by operational capacity, scheduling, and input supply. Four case studies reveal the livestock and horticulture sectors are most affected, particularly small businesses, while larger enterprises manage better.

To address the issue, the report suggests solutions including shared electricity generation with businesses and a supportive regulatory environment. Industry organizations can facilitate communication between government levels and agribusinesses, and government adoption of alternative energy could reduce private investment. The study underscores the value chain’s interconnectedness and identifies operational capacity, scheduling, and input supply as critical points.

The livestock sector, particularly poultry, showed short-term production contractions, but resilience overall. Field crops like canola faced temporary volume and area reductions affecting exports. Horticulture, encompassing fruits and vegetables, confronted challenges like quality and volume reductions, with water supply playing a pivotal role.

Loadshedding’s socio-economic impact was profound, especially on job opportunities in horticulture, a major employer. The Western Cape’s ambitions for value-added activities and employment were compromised due to energy shortages.

In summary, the BFAP report highlights the need for collaborative action to mitigate the electricity crisis in the Western Cape’s agricultural sector. Priorities include securing water supply, regulatory backing, and curtailment measures for agri-processing. The findings offer a roadmap to address the challenges posed by loadshedding and minimize its impact on the region’s agricultural prosperity.