South Africa Wine has raised concerns over the US government’s announcement that it intends to end South Africa’s preferential trade access under the African Growth and Opportunity Act (Agoa) from 1 January 2027.
In a statement, the wine body said this was another setback for the wine industry in an increasingly difficult market to compete in. Producers and exporters have already spent much of the past two years dealing with changing tariffs, rising costs and weaker demand. The prospect of losing Agoa preferences adds further uncertainty at a time when businesses need stability.
“That stability has been missing for some time. South African wine exporters previously enjoyed duty-free access under Agoa, with tariffs effectively starting at 0%. Since then, they have had to adjust to rates of 30%, followed by 10% and 12.5%, with the potential combined tariff now approaching 16% if Agoa preferences fall away.
“These repeated changes have already caused considerable commercial disruption. The concern is therefore not simply the additional duty of approximately three percentage points, but the cumulative effect of tariff increases and ongoing uncertainty on businesses trying to plan, price and compete in the US market,” South Africa Wine said.
Competing in a global market
According to South Africa Wine the United States remains an important market for South African wine, despite relatively modest export volumes.
“Historically, it has delivered higher average value per litre for packaged wine, reflecting its importance as a premium-value market. Prior to the introduction of tariffs, the USA was South Africa’s third-largest export market for packaged wine by value. While its position has since declined to seventh place, it remains firmly within our top ten markets.
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“Its strategic importance extends beyond the volumes we currently export. As the world’s largest wine market by value, the USA offers significant opportunities to strengthen South Africa’s reputation, build premium brand positioning and grow higher-value packaged wine exports.”
The body stated that maintaining a presence and investing in the market, therefore, remain important to their longer-term export growth ambitions.
“The impact has been especially severe for bulk wine. In 2025, the value of bulk wine exports to the US declined by 79% to just R13 million. With margins already under pressure, additional tariffs can make these exports commercially unviable. The question now is which South African wine brands, and at what price points, will still be able to compete profitably in the US market.
“We are also concerned about South Africa’s position relative to competing wine-producing countries, particularly European suppliers. The wine market is extremely competitive internationally. If our products become more expensive because of tariffs, importers and consumers have other options. Once shelf space or distribution relationships are lost, winning them back is not easy,” South Africa Wine said.
The SA government responds
Meanwhile in responding to the announcement, the South African government through the department of trade, industry and competition said it recognises the concern that this decision may create for workers, exporters, businesses and communities linked to Agoa supported value chains.
“Government will undertake further engagements with social partners to optimise the support measures aimed at improving resilience and sustainability of the productive sectors whilst diversifying exports and protecting jobs.
“Agoa remains important to South Africa, but it does not constitute the totality of the economic relationship between South,” the department of trade, industry and competition (DTIC) said.
The department said in 2025, approximately 89% of South African exports to the United States entered under ordinary World Trade Organisation most favoured nation terms, while approximately 10% entered under Agoa, down from 28% in 2024.
“The United States remains an important trade and investment partner. South Africa remains committed to a balanced and mutually beneficial partnership with the US that enables preferential trade that supports beneficiation of critical minerals at source and promotes investment,” the DTIC stated.
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