Source: Susan Marais, Farmer’s Weekly 21 Jauary 2022, photo credit: 123RF/krisa99
In the likely event that the South African Reserve Bank (SARB) increases the repo rate by 25 basis points (0,25%) in the coming week, farmers will have to prepare themselves for the fact that it will become more expensive to service their debt.
This was according to Marlene Louw, senior agricultural economist at Absa AgriBusiness.
Currently the repo rate (rate at which the SARB lends money to commercial banks) stands at 3,75%, while the prime rate stands at 7,25%.
Louw said that if the repo rate was increased, it would lead to an increase in the interest rate on loans, and therefore the servicing of debt would become more costly.
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The South African Pork Producers’ Organisation (SAPPO) coordinates industry interventions and collaboratively manages risks in the value chain to enable the sustainability and profitability of pork producers in South Africa.
