The Impact of Exchange Rate Volatility on South African Agricultural Exports

Ireen Choga () and Teboho Charles Mashao
Additional contact information
Ireen Choga: School of Economics Sciences, North-West University, Mafikeng 2745, South Africa
Teboho Charles Mashao: School of Economics Sciences, North-West University, Potchefstroom 2520, South Africa

Economies, 2025, vol. 13, issue 9, 1-17

Abstract: The South African exchange rate has been volatile in recent years affecting the competitiveness of commodities in the market. Consequently, South African agricultural exporters have faced lower profitability or entire losses. More South Africa is among the top agricultural exporters in Africa. Thus, the purpose of this study was to examine the effect of exchange rate volatility on agricultural exports in South Africa using the Exponential Generalized Autoregressive Conditional Heteroskedastic (EGARCH) model over the period extending from first quarter of 2013 to first quarter of 2024. The study finds that the exchange rate affects agricultural export negatively in South Africa. The findings display that the exchange rate is statistically significant in explaining agricultural exports in South Africa. In addition, this study finds interest rate affects agricultural exports negatively whereas investment and trade openness affect agricultural export positively in South Africa. This infers that agricultural exports in South Africa are explained by various economic factors. Therefore, this study proposes implementing currency stabilisation policies is a crucial strategy to reduce exchange rate volatility, thereby reducing the negative impact on agricultural exports in South Africa. The policymakers can use currency hedging as tool to lessen the negative impact associated with the exchange rate volatility.

Keywords: agricultural; exports; exchange rate; South Africa; EGARCH; time-series analysis (search for similar items in EconPapers)
JEL-codes: E F I J O Q (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2227-7099/13/9/247/pdf (application/pdf)
https://www.mdpi.com/2227-7099/13/9/247/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jecomi:v:13:y:2025:i:9:p:247-:d:1730283

Access Statistics for this article

Economies is currently edited by Ms. Hongyan Zhang

More articles in Economies from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().