Finance is emerging as a decisive factor in South Africa’s shift to regenerative agriculture, as farmers face growing pressure to adapt production models while maintaining commercial viability.
Speaking at the Landbouweekblad Regenerative Agriculture Conference 2026, Daneel Rossouw, Head of Sales for Nedbank Agriculture, said the transition requires more than operational change.
“The transition to regenerative agriculture is not simply operational ‒ it demands deliberate financial restructuring. Without getting this right, even the most committed producers risk losing viability.”
Focus on commercial viability
The Landbouweekblad Regenerative Agriculture Conference 2026 is a series of workshops held in the Free State, Western Cape and North West, bringing together farmers, researchers and industry stakeholders to explore practical approaches to soil health, resilience and reduced input dependency.
A key theme is the commercial viability of regenerative agriculture, particularly the financial implications of transition, including risk management, cash flow and funding structures.
Debt structures under pressure
Rossouw said existing debt structures are often not suited to regenerative models.
“Too many farming businesses are locked into financing structures that were designed for conventional, input-heavy systems. These structures often leave little room for manoeuvre, particularly during a transition period where yields may fluctuate and upfront costs are high.”
He said restructuring is necessary to create working capital flexibility, align repayments with realistic cash flows and extend financing terms where required.
“Without this flexibility, farmers are effectively being asked to change systems while standing on unstable financial ground.”
Need for flexible financing
Beyond restructuring, Rossouw highlighted the need for well-designed term financing that supports a gradual transition.
“This is not about increasing debt recklessly. It is about structuring capital in a way that supports change rather than constrains it.”
Asset financing also plays a role, particularly for equipment aligned with regenerative practices, although he noted that optimising existing resources is often more effective than immediate capital investment.
Working capital a key pressure point
According to Rossouw, working capital requirements present one of the biggest challenges during transition.
“Regenerative transitions often bring short-term uncertainty in income alongside additional upfront costs. Treating this as 'business as usual' working capital is a mistake,” he said.
“It should be carefully ringfenced, actively managed, and structured outside traditional norms. This creates transparency, discipline, and – critically – breathing room during a period of change.”
Sustainable finance critical
“Underpinning all of this is a non-negotiable principle: the numbers must make sense,” said Rossouw. “Not just for the client, but for the bank as well. Sustainable agriculture cannot be built on unsustainable finance. If funding models rely on optimism rather than realism, they will fail, and take producers with them.”
Rossouw said environmental, social and governance (ESG) frameworks are increasingly influencing how agriculture is financed and assessed.
Farmers are facing growing pressure from export markets and retailers to demonstrate not only what they produce, but how production is financed and managed.
Balancing opportunity and risk
In South Africa, regenerative agriculture is gaining traction as producers respond to climate variability, rising input costs and the need for long-term resilience.
However, challenges remain, including upfront risk, potential yield fluctuations, skills gaps and inconsistent definitions of regenerative practices.
“The future of agriculture will not be determined by ideology alone. It will be determined by whether capital is structured intelligently enough to support change. And that is a responsibility shared by both farmers and financiers.”
