CUTTING EDGE The leading position of greatest importance or advancement. Something that is the latest, greatest and newest.
Looking back at 2012 • Low global stock levels - firm commodity prices • Increased investment and interest in agriculture • Low interest rates and softened exchange rate • Generally good rainfall • Negativity around labour relations • No major disasters or disease outbreaks • Reaction to the green paper • Establishment of ASUF • Food price inflation • Market characteristics
Investment
Looking back at 2012 • Low global stock levels - firm commodity prices • Increased investment and interest in agriculture • Low interest rates and softened exchange rate • Generally good rainfall • Negativity around labour relations • No major disasters or disease outbreaks • Reaction to the green paper • Establishment of ASUF • Food price inflation • Market characteristics
Low interest rate andsoftened exchange rate
Looking back at 2012 • Low global stock levels - firm commodity prices • Increased investment and interest in agriculture • Low interest rates and softened exchange rate • Generally good rainfall • Negativity around labour relations • No major disasters or disease outbreaks • Reaction to the green paper • Establishment of ASUF • Food price inflation • Market characteristics
Agricultural Market Characteristics
Bigger, better or busted • BIGGER vista • Sufficient scale will be essential to success • Leadership structure and business acumen • Operational efficiency and productivity • Capital investment decisions • Market led versus Product led • Information era • Corporate and social responsibility • Corporate governance and discipline • Labour practices • Networking • Build credibility, respect and transparency
Bigger, better or busted • BETTER vista • The People business – customer centricity, skills, succession • The Change business – speed, decision making, new mindset • The Virtual business – compete anywhere, anytime, against anyone • The Information Communication Technology enable business • The Innovation business – green, precision farming, high tech • The Risk Business – holistic view on procurement, product, people, processes, promotion, price, market • The Profitable business – milestones, modeling, forecasting
Five themes driving Africa’s enduring allure • A larger, more affluent population • Africa’s urban swell • Leapfrogging through technology • Africa’s resources potential • Deepening services sector (technology, financial, logistics, inputs)
Growth expectations
Africa’s resource potential Globally, Africa holds most uncultivated arable land… • While only 8.5% of land in SSA is arable, it accounts for 60% of the world’s total uncultivated arable land – offering vast potential to meet future global food demand. • Agricultural output is projected to increase 3 fold by 2030 (McKinsey) • 9 bn people by 2050 = evidence for the significant potential for agric sector investments • At the same time SSA population is expected to double by 2050 – leading to the question ‘how much production will be available for export.....’
The future • Demand and consumption patterns of food continuously shifting • Inflationary pressure expected to grow • Productivity and efficiency will be a major focus going forward • Price volatility will remain present • Weather risk will increase • Increased pressure on natural resources • Holistic view on agriculture in SSA, potential & risk • National Development Plan direction and implementation • United agricultural sector • Vertical integration in the Agric value chain • Focus on sustainability
Focus on sustainability • Cutting edge solutions • Renewable energy project support • Wind, solar and co-generation • Renewable fuels • Carbon credits • Supplier links and JV’s
How Standard Bank issupporting the industry • Banking solutions and funding across the Agric value chain • Standard Bank Centre for Agribusiness and Leadership • Development – Imbizo’s, Young leaders lab • Post grad programme • Business development support • Leadership engagements • BEE support and enterprise development • Strategic sponsorships
How Standard Bank issupporting the industry • Cutting edge solutions • Agricultural specialization across channel and product • Access points • Remote account opening • Payments and collections • Liquidity management • On boarding capability • New Renewable energy unit
“Even in nature plants and animals adapt to change very successfully. Change is an adventure if it is slow and spontaneous! The problem is when radical and quick • change is forced into our lives, our business and our social structures. • This turns the reality of change into a threat, an enemy, a stressor but also an enormous opportunity” • All of this can happen instantaneous. We therefore need to adopt a Cutting Edge mindset. • “Is your business cutting edge?”
Thank you for the opportunity to share some cutting edge ideas. • sbsa.agricultural@standardbank.co.za • 011 636 6162
