Take advantage of opportunities
– even when the macro-environment requires a more cautious approach
DANIE MINNAAR Senwes Chairman
REFLECTIONS BY THE CHAIRMAN
Last year ’ s report was written at the outset of the Covid-19 lockdown period . As I am writing this report , each one of us has gained a year ’ s experience of the impact of this severe pandemic . Although we are all learning and adapting as we go along , we don ’ t know when life will return to normal . We can , however , be certain of the fact that the virus will be with us for the foreseeable future .
It is becoming increasingly difficult to conduct meaningful business in rural areas . Not only is South Africa resisting the disruptive effects brought about by Covid-19 , it is also navigating crippling social , political and economic issues of deep concern . From an economic and political perspective , the period under review has been a bruising time for South Africa . Policy uncertainty , such as the land reform issue , poor economic growth , international credit rating downgrades and the financial and operatio nal woes of stateowned enterprises continue to negatively impact the country ’ s fragile economy . Add to this escalating crime levels and rampant corruption as a consequence of state capture and counter-productive cadre deployment , and it becomes clear that the country ’ s challenges are mounting .
However , one of the features which stood out during these recent times of disruption and crisis , has been the collaborative way in which South Africans have come together to weather the proverbial storms . Communities across the country are coming together in ways never seen before to repair infrastructure and rejuvenate local economies .
During 2020 the global oil price surged dramatically on the back of a slump in prices as low as $ 20 a barrel . This boosted grain prices significantly after a four-year period of declining stock levels . At present , the US corn price is double last year ’ s price .
Last year ’ s harvest , along with fair market prices , favoured our customer base . This is reflected in the group ’ s noteworthy decline in outstanding debt . These conditions greatly contributed towards the sector ’ s sterling performance over the past eighteen months .
It is also noteworthy that soybean production in South Africa is increasing to the point where the country is set to reach a level of self-sufficiency soon . With this in mind , Senwes is well positioned to increase its intake of soybeans while taking heed of the shift in traditional crop composition choices .
Senwes ’ long-term strategy of consolidation has reached momentum and saw the group attaining a 57,7 % share in KLK Landbou during the previous financial year . This financial year saw the consolidation of Senwes with Suidwes Holdings and its ope rating companies . Through this consolidation we will continue to provide unsurpassed services and unlock value for our shareholders and all our stakeholders . Another exciting development in this regard is the announcement that Senwes Equipment is expanding its product offering by including the newly launched John Deere construction and forestry equipment range .
Agribel Holdings (“ Agribel ”), Senwes ’ holding company previously known as Senwesbel , acquired Grindrod ’ s shares in Senwes during March 2021 . These shares were in the market for quite some time since Grindrod was in
14 SENWES INTEGRATED REPORT 2021 RESILIENCE