Farmers, of necessity, take the long view. Absa does too. The banking group has shown that building long-term partnerships in the agricultural community is good for farmers and good for South Africa as a whole.
Wine farmers know that helping a vineyard reach its true potential takes years – generations perhaps – of careful nurturing, constant attention and unwavering patience. Farming is about long-term rewards, not quick returns. It’s a philosophy shared by banking group Absa, which this year marks a quarter-century of sponsoring the Top 10 Pinotage Awards.
Formed in 1991 by the amalgamation of three venerable banking institutions, Absa has roots that run deep in the agricultural community. For more than a century it has been instrumental in supporting farmers across southern Africa. Fast-forward to 2022 and the institution continues to keep a keen focus on agriculture. Within each province it employs specialist agricultural economists who share everything from market outlook reports to viability studies in a bid to support South Africa’s proud farming industry.
That sense of partnership was particularly valued during the devastating alcohol bans imposed in response to the Covid-19 pandemic. “We worked even more closely with our farmers,” explains Abrie Rautenbach, Absa’s head of agribusiness. “We were able to help those clients in forecasting what the future may look like and to devise plans to make it easier for them.”
This long-established tradition of partnership is just one of the reasons why Absa is today the largest agricultural lender in South Africa.
“And we are consistently growing our market share,” adds Abrie. “We focus on partnerships and relationship banking. We have worked hard to build the skill sets within Absa to serve South Africa’s farmers.”
That extends to its long-term support of the Pinotage Association, which has worked tirelessly to promote innovation and quality, supporting wine farmers and cellar masters in their bid to cement the cultivar’s place on the world stage of wine.
And while celebrating the rich farming tradition in the Cape Winelands, Absa works closely with future-focused farmers who are looking to innovate in their industry, using technology to improve productivity and ensure South African vineyards remain globally competitive.
“People often think agriculture is a consistent industry, where you simply farm like your grandfather did, but that has definitely changed,” observes Abrie. “As a bank we need to be able to manage clients through generational change. And whereas the older generation offers enormous experience, the adaptation to technology from the younger generation, the challenge of change, is fascinating for us. Technological developments in recent years have been tremendous, from remote sensing with drones to farming equipment operating via global positioning systems. We are now in an era where big data and information points become important for growth and future success. Because we have such a dedicated focus on agriculture, as a bank we are able to be a bit more experimental and ambitious in our approach.”
Of course, innovation often comes with considerable capital outlay and Absa has long been on hand to partner with clients in the agricultural industry. Absa is, for instance, the exclusive John Deere finance partner in South Africa. The institution also assists farmers with everything from land purchases and trade finance to letters of credit.
“As a bank we want to support them from a financial perspective,” says Abrie. “Agriculture is such a dynamic environment, where efficiency is becoming exceptionally important. We work with our clients and farmers so that we can support them through the inevitable cycles. In building relationships with our farming community, we take a long view.”