Due Diligence in Agriculture

South Africa's agricultural sector is a critical component of its economy, with exports valued at around $12 billion annually, according to 2022 and 2023 data. Major exports include citrus fruits, maize, wine, nuts, sugar, and wool, with key markets in the European Union, Asia, and various African nations. The agricultural export balance has been consistently positive, contributing significantly to the trade surplus, despite global challenges in supply chains.

In recent years, the South African government has prioritized strengthening its trade relations within BRICS countries, aiming to reduce tariffs and remove trade barriers. This shift, especially toward China and India, offers potential growth for agricultural exports, aligning with broader strategies to support the sector's global competitiveness. Additionally, agriculture provides significant employment within South Africa, with about 920,000 people working in primary agriculture by the end of 2023, though employment varies across provinces due to seasonal and regional factors.



The importance of performing due diligence in the energy sector

Due diligence in the agricultural sector is crucial for managing risks, ensuring compliance, and assessing the sustainability of investments. This process typically involves evaluating land quality, water resources, environmental impact, and the financial stability of agricultural projects or suppliers. Through careful due diligence, companies can identify potential issues related to soil fertility, climate risks, regulatory requirements, and ethical standards, which helps to mitigate financial losses and safeguard long-term productivity. This level of scrutiny is essential for fostering sustainable practices, protecting investor interests, and building trust in agricultural markets.

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