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The recent imposition of 30 percent tariffs on South African products by the United States has raised concerns among farmers and analysts about the potential impact on the country’s agricultural exports.
The matter was raised at a panel discussion during Standard Bank business and commercial banking’s Africa unlocked conference 2025.
The tariffs, announced by US President Donald Trump on 7 July, will take effect from 1 August unless a new trade deal is reached.
Agricultural products were previously exempt under duty-free access; and while the export of these products might see a relatively small overall economic hit, the Western Cape could be in for a major rough patch.
According to Wesgro, the Western Cape’s agency for tourism, trade and investment promotion, exports from the province to the US came to R16.2 billion last year and accounted for eight percent of total Western Cape exports.
Louw Pienaar, senior analyst at the bureau for food and agricultural policy, said that the impact could be severe.
“If you can’t export to the US at a 30% tariff, where will you go? Citrus, for example – if you move citrus from the US, which is a premium market, then it might mean that prices will fall elsewhere,” Pienaar said at the panel discussion.
“Nobody is sure who exactly will pay the tariff. Will it be the end consumer? Will it be SA producers? Or will the value chain absorb that? I still think it’s going to be a range – if demand is strong enough, the US retailer will pay that. If there’s pushback, it will have to change.”
South African citrus and wine exports may become less competitive in US markets, which could lead to less demand and lower prices.
Table grape producers who exported 50 percent of their produce to the US could face substantial losses.
The African continental fee trade area (AfCFTA) agreement aims to boost intra-African trade but faces challenges, including high costs and infrastructure gaps. South Africa’s agricultural sector could need to adapt to these changes to remain competitive.
Experts at the conference suggested that South Africa should diversify its trade within the Southern African customs union and other regions to mitigate the impact.
Pictured above: South African winelands
Source: @wosa_usa
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