Analysis
How South African Agribusinesses Can Take Control of Forex Risks & Trade Shifts
As South Africa navigates shifting global trade dynamics, AGOA uncertainty and forex volatility present both risks and opportunities for agricultural exporters.
In this article we explore how forward-thinking agribusinesses can expand beyond the South African consumer market, manage currency exposure, and leverage forex strategy as a competitive advantage.
Discover how South African exporters are adapting to trade shifts, securing new markets in China and the EU, and building resilience through multi-currency strategies. The future belongs to those who take control—learn how to position your business for long-term success.
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Nicky Strydom
- 5 minutes read
For years, South African farmers and exporters have relied on the African Growth and Opportunity Act’s (AGOA) trade benefits to expand into the U.S. market with duty-free agricultural exports. However, with forex volatility in global trade and shifting U.S.-Africa trade relations, the future of these export advantages is becoming increasingly uncertain. The difference between success and struggle will come down to preparation—those who anticipate change and act decisively will shape the next era of South African agriculture.
While forex volatility, trade restrictions, and logistical disruptions pose risks, they also open the door to new opportunities. The agribusinesses that rethink their strategies, embrace risk management, and expand into high-growth markets won’t just survive—they’ll shape the next era of South African agriculture.
So, the real question is: How will you position yourself in this evolving market?
The South African Agricultural Sector —a Window of Opportunity
We’re at a turning point. The 2025 outlook for South African agriculture presents both challenges and opportunities, but one thing is clear—business as usual is no longer an option.
Global demand for South African exports remains strong, with China, the EU, and the Middle East actively increasing agricultural imports. As U.S. trade relations grow more uncertain, these markets are emerging as viable alternatives, offering new avenues for growth. At the same time, the sector is expected to see a recovery, with agricultural GDP projected to rebound as infrastructure investments improve efficiency and a growing consumer base drives demand
However, forex volatility is becoming a greater risk factor. Shifting trade policies, fluctuating exchange rates, and inflationary pressures mean that pricing strategies, hedging mechanisms, and cross-border financial planning need to be approached with greater precision. Businesses that fail to adapt to these changes, risk losing their competitive edge, while those that recognise the need for a new strategy will position themselves for long-term success.
This is not the time to play defense—it’s the time to take control.
Beyond AGOA - Shifting to Multi-Market Strength
The South African agricultural sector is at a pivotal moment. While the U.S. has been a dominant buyer, that status is no longer guaranteed. With AGOA preferences at risk, exporters must reconsider their strategies—not out of fear, but out of foresight.
Waiting for clarity is not a strategy—by the time certainty arrives, opportunities will have been lost. The businesses that pivot now, proactively securing new markets and diversifying their forex strategies, will be the ones thriving in the long run.
If AGOA preferences are revoked, the U.S. market will no longer be as accessible, and South African exporters will find themselves facing higher tariffs, making their goods less competitive almost overnight.
The ripple effects of such a shift would be immediate. A weakening rand could drive up import costs, affecting everything from fertilisers to transport expenses, while supply chain disruptions could make pricing even more unstable. The stakes are high, and the risks are clear.
But change also brings opportunity. China, the EU, and BRICS nations are actively increasing agricultural imports, presenting South African exporters with a critical opportunity to diversify beyond AGOA. To remain competitive, businesses must adapt their forex risk mitigation strategies, optimise international pricing structures, and consider a multi-currency forex strategy to manage exchange rate fluctuations.
For businesses willing to diversify, this transition could mean greater resilience and less dependence on a single trade partner. Adopting a multi-currency approach will be essential to stabilising revenue streams across different global markets, ensuring that businesses are not overly exposed to U.S. dollar fluctuations. At the same time, proactive risk management will be the difference between struggling with forex volatility and using it as a competitive advantage.
South African agriculture is entering a new phase. The question is no longer whether the shift will happen, but how well businesses will position themselves to turn this transition into long-term growth.
In this podcast episode, Sharon Constançon, the Chief FX Strategist at CC Currencies, delves into the complexities of Forex management in the South African agricultural sector. She highlights the logistical challenges, market volatility, and weather-related risks that impact farmers and exporters.
Adapting to Trade Shifts - From Challenge to Competitive Edge
The U.S. has long been a crucial market for South African agriculture, but it is no longer the only path to growth. As trade policies shift and AGOA’s future becomes uncertain, businesses that recognise the importance of diversification are already moving ahead.
Forward-thinking exporters are securing new buyers in China and Europe, where demand for South African produce is on the rise. By establishing footholds in these markets, they are reducing their dependence on the U.S. and ensuring that their products remain competitive on the global stage.
At the same time, they are rethinking their currency exposure. With the potential for increased tariffs and shifting trade flows, relying solely on the U.S. dollar presents unnecessary risks. Businesses that diversify their currency strategies—adapting to transactions in yuan, euros, and other major trade currencies—are protecting themselves against volatility and securing greater financial stability.
Beyond market expansion and currency shifts, the most resilient businesses are also optimising their pricing structures and supply chain strategies to maintain profitability despite changing economic conditions. By aligning their forex strategies with their operational goals, they are not just responding to uncertainty but turning it into an opportunity for long-term strength.
This is not about reacting to trade tensions—it is about using them as a catalyst to build a more agile, competitive, and resilient agricultural industry. South African businesses that embrace this shift will not only withstand market fluctuations but will emerge stronger, more adaptable, and ready to capitalise on the next wave of global demand.
What the Smartest South African Exporters Are Doing Right Now
The most successful South African exporters are not waiting for market shifts to dictate their future—they are actively positioning themselves to thrive in an evolving global trade environment. By diversifying their markets, managing forex strategically, and strengthening their supply chains, they are building resilience and securing long-term profitability.
1. Expanding Beyond the U.S.
With uncertainty surrounding AGOA and U.S. trade policies, top exporters are expanding their reach into high-growth markets. However, entering these markets is not as simple as finding new buyers; it requires a fundamental shift in financial strategy to accommodate different regulatory environments, pricing structures, and currency exposures.
- China, the EU, and BRICS countries present significant opportunities, but each market requires a tailored forex approach to maximise profitability.
- Exporters who understand how to price in yuan, euros, and rupees are gaining a competitive advantage, reducing their dependence on the U.S. dollar and protecting their margins from forex volatility.
2. Managing Forex Proactively, Not Reactively
Increased forex volatility is inevitable, but the businesses that plan ahead rather than react to rate fluctuations are the ones safeguarding their profitability. The most successful exporters approach forex as a strategic tool rather than an operational risk, integrating it into pricing models, budgeting decisions, and market positioning.
- Forex strategies are delivered through multiple decisions throughout the season, not as one-off transactions. Exporters must continuously adjust their positions to align with market movements, pricing expectations, and financial goals.
- Setting a realistic budget rate for the season is critical—this ensures that pricing is predictable and sustainable, rather than reactive to sudden currency fluctuations. A well-defined budget rate provides a solid foundation for financial planning and protects profit margins.
- The discount for hedging forward is an advantage that must be used effectively. By leveraging the rate curve and timing strategies, exporters can take advantage of forward pricing discounts, ensuring that they are locking in favourable rates ahead of market volatility.
- Defining a benchmark rate for international pricing is essential. This benchmark should be aligned with the budget, hedging portfolio, and competitor activity, allowing exporters to maintain a competitive edge in global markets while ensuring financial stability.
- Rather than reacting to forex market fluctuations, exporters must take a structured approach to forex risk management, securing favourable exchange rates through currency futures, forward contracts, and spot pricing strategies. Businesses that use currency hedging techniques strategically can protect their margins from forex volatility in agriculture.
- Hedging should be done with precision, not blindly. Businesses that hedge effectively minimise risk exposure while maximising financial flexibility, ensuring they can adapt to shifting market conditions without being locked into unfavourable rates.
- Exporters who rely solely on the U.S. dollar expose themselves to currency risk in international trade. The most resilient businesses are implementing multi-currency pricing strategies, transacting in yuan, euros, and other global trade currencies to hedge against market volatility and remain competitive. By aligning forex strategies with global commodity pricing trends, they can maintain stability in their international trade finance and ensure strong profit margins across diversified export markets.
The bottom line? Proactive forex management isn’t just about protecting against losses—it’s about securing long-term financial stability, optimising pricing, and turning forex into a competitive advantage.
3. Building Resilience in Their Supply Chains
Local transport disruptions still exist, with road, rail and port challenges. Global trade disruptions continue with shipping, adverse weather, the closed Suez Canal, port congestion, and rising transport costs, which continue to create challenges for exporters. Leading businesses are ensuring that their supply chains remain efficient, cost-effective, and adaptable.
- They secure trade routes that minimise logistical disruptions, ensuring products reach their destinations on time and in peak condition.
- They work with strategic forex partners to align pricing, mitigate risks, and optimise every international transaction.
- They are evaluating supplier contracts and logistics costs through a forex lens, ensuring that exchange rate fluctuations do not erode their profit margins.
Exporters who adopt these strategies are not just weathering the storm—they are turning market shifts into a competitive advantage.
Early movers will gain a lasting foothold as new trade routes solidify, and alternative markets mature. Those who act now will not just adapt to change—they will define the next decade of South African agricultural exports.
The Future Belongs to Those Who Take Control
South African agriculture is entering a new era defined by shifting trade alliances, evolving market demands, and rising forex volatility in global trade. The businesses that recognise these changes and take action now will be the ones shaping the industry’s future—turning foreign exchange risk into a strategic advantage rather than a challenge.
A well-executed forex strategy is no longer just a defensive tool—it has become a competitive advantage. The businesses that proactively manage foreign exchange risk, optimise their international pricing benchmarks, and diversify their market reach will not just survive—they will thrive. By integrating hedging strategies and structured forex budget planning, they ensure that currency fluctuations do not erode their profitability. Those who delay or take a reactive approach will find themselves struggling to keep up in an increasingly complex global trade environment.
The future of South African agricultural exports will be defined by those who develop a strong forex strategy and embrace market diversification. Businesses that act now—aligning forex risk management with long-term trade objectives—will be the ones leading the way.
Those who hesitate? They’ll be left trying to catch up.
