The ministry of finance has approved a 34% import tariff increase on wheat imports to R1 224.31 per tonne from R911.20 per tonne.
The National Treasury granted Grain SA’s request but, in a statement, expressed concern about the effect of the automatic tariff formula on the price of bread and other staple food. A spokesperson said therefore that Treasury had asked trade and industry minister, Dr Rob Davies, to institute an urgent review of the increase.
The controversial request by Grain SA has met with some opposition. The National Chamber of Milling (NCM) executive director, Boikanyo Mokgatle, said recently: “Why do we need protection with a commodity that we are so self-sufficient with? We cannot shy away from the fact that it could actually end up being a cost to the consumer.”
Furthermore higher maize prices would also impact other agricultural sectors. Johan Willemse, an agricultural economist at the University of the Free State, told FTW Online that livestock farmers already could not afford to feed their cattle, noting that additional import duties would add to the cost of meat production, making that industry less competitive.
Grain SA CEO, Jannie de Viliiers, commented that the extra tariff duty was necessary because almost all competing maize-exporting countries’ governments were subsidising their farmers. “South African farmers get almost no assistance from government and we have requested that we get protection against these governments.”
South Africa imports about 60% of its wheat requirements.
