Treasury's wheat, sugar import tariff changes spark mixed reactions from trade experts

Global Trade Advisors has applauded the reduction of import tariffs wheat, wheat flour, and sugar announced by the National Treasury last week.  

Treasury said the duties on wheat were reduced from 42.20c/kg to 18.35c/kg and on wheat flour from 63.29c/kg to 27.52c/kg.

However, the duties on sugar were raised from 234.89c/kg to 286.25c/kg and raised again to 377.35c/kg on 11 April.

The duties on sugar and wheat are calculated using a US dollar-based reference price, rather than following an investigation by the International Trade Administration Commission of South Africa.

“Basically, when the global price of these commodities falls below a reference price for a certain period, a duty increase is automatically triggered,” Global Trader Advisors said on Monday.

“Likewise, when the price remains above the reference prices for a period, the duties will fall.”

Francois Rossouw, CEO of Southern African Agri Initiative (Saai), said that South Africa imports about half of the wheat it needs each year, and that’s not a bad thing.

“This system helps make sure that wheat products like bread and flour are always available on store shelves at stable prices,” Rossouw said.

“Since local farmers face challenges like poor weather or limited land suitable for growing wheat, importing helps fill the gap when harvests are low. For consumers, this means more consistent pricing and supply, even when local conditions aren’t ideal.”

Rossouw added that for farmers, this setup can actually be helpful too.

“Instead of trying to grow all the wheat the country needs, sometimes in areas that aren’t suited for it, they can focus on producing good quality wheat in the best regions,” he said.

“Over the years, farmers have become more productive, getting more wheat from the same land. With global wheat prices and import rules keeping things balanced, this system supports both affordable food for families and a more sustainable way for local farmers to operate.”

Rossouw said that the sharp increase in sugar duties was positive news for sugarcane farmers, particularly small-scale family farms in regions such as KwaZulu-Natal and Mpumalanga.

“By raising tariffs, local sugar producers gain temporary protection against cheaper imports, helping stabilize domestic sugar prices and potentially improving profitability. However, continuous volatility in tariff rates can create uncertainty for these farmers, making planning and investment difficult.”

BUSINESS REPORT