Key End-of-Summer Cash Flow Challenges

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As the peak of summer fades, savvy vegetable farmers know this is the perfect time to strengthen their financial position. While fields are still producing and demand remains steady, taking proactive steps now can ensure stability in the months ahead. Farmers can create a buffer that sustains them through seasonal transitions and unexpected shifts in the market. Strong preparation today leads to a thriving operation tomorrow.

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In this section, we’ll explore the biggest end-of-season cash flow hurdles farmers encounter — and why they’re so difficult to manage.

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1. Your income drops, but your costs don’t

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During the height of the season, farmers generate strong revenue. Let's use the example of a tomato grower. They see their best sales between March and May. 

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This season, on an open field in the highveld, a farmer expecting to harvest 55 -70 ton/ha on 20 ha could generate ZAR11 million to ZAR 12 million in revenue - based on February 2025 prices¹. But post-harvest, the farm is still on the hook for labour, maintenance, utilities, and loan repayments.

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Without careful financial planning, these ongoing costs can eat into profits and put farmers in a tight spot before the soil starts to heat up again.

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2. Debt repayment pressures

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For many farmers, short-term or seasonal production loans are essential for maintaining smooth operations. However, when the harvest ends, these loans often become due at precisely the worst time.

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In South Africa, farmers are experiencing debt repayment pressures due to factors such as drought — affecting their income — and rising interest rates. For example, the mid-summer drought of 2023-24 led to significant crop losses, causing financial strain for numerous farmers. This situation is worsened by elevated interest rates, which can complicate loan repayments. Consequently, some farmers may be forced to sell off assets or default on loans to manage their debt obligations.

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3. End-of-season price crashes

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As the season ends, a flood of produce hits the market, driving prices down. When too many farmers are selling at the same time, wholesale vegetable prices can drop by as much as 40–60%. That’s a massive hit to profit margins.

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On top of that, farmers often lose 15–20% of their revenue to low prices and high transport costs, as seen in some regional markets³. In some cases, the prices buyers are willing to pay just aren’t enough to cover farmers’ growing expenses, making it even harder to stay afloat.

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4. Lack of cash for replanting

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Harvesting pressures may be declining, but the winter planting window is steadily drawing near. Farmers need to secure seeds, fertiliser, and other essentials to get new crops in the ground. But with cash reserves running low, replanting can feel like an uphill battle.

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The costs add up quickly — seeds and fertiliser alone can range from ZAR 13,500 to 21,900 per hectare. If farmers can’t secure funds in time, planting gets delayed, which can shrink next season’s yields by 15–30%. That’s how cash flow gaps turn into long-term setbacks, making it even harder to break the cycle.

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Timing is everything in farming, and the entire growing season can be thrown off track without quick access to funds.

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How to Tackle End-of-Season Cash Flow Gaps

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The post-harvest cash crunch doesn’t have to be inevitable. With the right strategies, farmers can keep cash flow steady and set themselves up for long-term financial stability. Here are five practical ways to stay financially secure even after the harvest ends.

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1. Set aside savings during peak season

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A little planning can go a long way. Putting aside 10–15% of harvest income in a separate account can help cover expenses when sales slow down. Even a small reserve can ease financial stress when cash flow is tight⁴.

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Here are some tips on how to start saving:

✅ Open a separate savings account for post-harvest costs.

✅ Set up automatic transfers so a portion of your sales goes directly into savings.

✅ If saving 10–15% feels too high, start with a smaller amount and build up.

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2. Secure buyers before you plant‍‍

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Locking in contracts with processors or retailers before planting can provide much-needed stability. These agreements often include upfront payments covering 30–50% of expected sales, helping farmers fund replanting and other key expenses.

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Need to find a supplier? Here's how to go about it:

✅ Reach out to buyers before the planting season to discuss contracts.

✅ Work with multiple buyers when possible to avoid relying on just one.

✅ Make sure contract terms are clear — especially on payment schedules and quality requirements.

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3. Work with lenders to adjust loan repayments

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Loan repayments hitting right after harvest can be tough to manage. Some lenders allow repayment schedules that start 6–8 months after planting, making it easier to align debt payments with income cycles⁵.

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How to negotiate better terms:

✅ Contact your lender before planting season to discuss flexible repayment options.

✅ Explain your farm’s income cycle and propose a schedule that works for you.

✅ Check if there are government-backed agricultural loan programs with better repayment terms or blended terms - such as the Land Bank’s Blended Finance Scheme.

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4. Use short-term credit to bridge the gap

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Getting paid for your harvest doesn’t always happen right away. Buyers can take weeks to process payments, but farmers need cash much sooner — to prepare land, buy seedlings, and keep operations running.

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That’s where short-term working capital comes in. Options like revolving credit or short-term loans can help bridge the gap, giving farmers access to the funds they need while waiting for payments to clear.

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Here’s what to  keep in mind before borrowing:

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✅ Compare different lenders to find the best interest rates and terms.

✅ Only borrow what you need and make sure repayments fit your cash flow.

✅ Look for lenders (like Pumpkn!) who specialize in agricultural loans, as they may offer more flexible terms.

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Final thoughts

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The post-harvest cash flow squeeze is a tough challenge, but it’s not one without solutions. With income slowing down while costs keep piling up, farmers need a plan to stay financially stable between seasons.

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By setting aside savings during peak season, securing pre-harvest contracts, restructuring loan repayments, and using short-term credit wisely, farmers can ease financial pressure and keep operations running smoothly. Exploring additional income streams—like growing off-season crops or buying to process other crops (e.g., sliced & diced winter vegetables)—can also help create a more resilient business.

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With the right financial strategies in place, farmers don’t just survive the off-season—they set themselves up for long-term success. A well-managed cash flow means more stability, more opportunities, and ultimately, a thriving farm year after year.

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Sources:

1. Standard Bank - February 2025 Horticulture Biweekly Insights Report 
2. AgBiz - January 2024 Weekly Viewpoint
3. Louw, A., & Jordaan, D. (2016). Supply chain risks and smallholder fresh produce farmers in the Gauteng province of South Africa. Southern African Business Review, 20.
4. GrainSA - August 2020, Watch your cash and survive 
5. Schoeman, J. L. (2019). Case studies of modern agricultural credit evaluation methods for different credit providers in South Africa [Master’s thesis, Stellenbosch University]‍

About Pumpkn

At Pumpkn, we understand the financial challenges that come with seasonal farming. Our flexible funding solutions are designed to help farmers access the capital they need — whether it’s for replanting, managing operational costs, or bridging cash flow gaps.  Find out how we can support your farm’s financial growth by getting in touch.

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About the Authors

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Jérôme van Innis is the co-founder of Pumpkn—a digital-first lender specialising in SMEs within the agriculture, food, and manufacturing sectors. With over 15 years of experience in consumer goods, agriculture, and SME finance and growth across Europe, Asia, and Africa, he is a recognised expert in the field. Jérôme holds an MBA from INSEAD (Singapore) and an MSc in Business Engineering from UCLouvain (Belgium).

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Tebogo Sebambo is a seasoned marketing and business development leader with a strong track record in agribusiness, fintech, and impact-driven programs. With experience across corporate, entrepreneurial, and non-profit sectors, Sebambo has led strategic initiatives that enhance market access, financial inclusion, and sustainable growth for farmers and agribusinesses. He holds a Management Advancement Program certificate from Wits Business School and a Bachelor's degree from the University of Pretoria

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