A new era of trade restrictions is upon us. Buhlebemvelo Dube, economist for trade research at the National Agricultural Marketing Council (NAMC), explains why the stakes have never been higher for South Africa’s export-driven agricultural economy.
The multilateral trading system is entering a renewed era of fracture. By May 2025, the World Trade Organisation (WTO) had recorded 644 new trade measures on goods within just seven months – 46% of them restrictive, marking the highest level of new trade coverage since the Trade Monitoring Exercise began in 2009.
This is alarming because nearly half are restrictive, posing serious challenges for South Africa’s export-driven agricultural sector. Rising protectionism is no longer a theory – it’s a policy reality, and South Africa’s agri-economy is directly affected.
Particularly concerning is the 30% U.S. tariff on selected agricultural products, imposed under national security clauses (Executive Order No. 14257, 2025). With South African agri-exports to the U.S. valued at above R10 billion annually, this creates both a commercial shock and a strategic challenge for exporters, agribusinesses, and trade officials.
For an economy reliant on exports, where agriculture contributes over 10% of total export revenue, this shift in trade dynamics cannot be overlooked. The sector needs calm, strategic responses; panic will not help.
Protectionism and global trade decline
According to the WTO’s Global Trade Outlook and Statistics Report (April 2025), the world merchandise trade volume is projected to decline by 0.2% in 2025, reversing gains from 2024. The decline is directly attributed to tariff increases and trade policy uncertainty (TPU), with the worst-case scenario projecting a 1.5% global trade contraction, driven by reciprocal tariffs and their contagion effects.
The trade coverage of these new protectionist measures totals USD 2.7 trillion, with over 83% of that implemented since January 2025. Tariff-induced disruptions are expected to cut North American exports by 12.6%, with ripple effects across global value chains. South Africa, which relies on these channels for both exports and key inputs (such as machinery, seed, and animal vaccines), faces dual exposure: loss of market access and costlier imports.
The services sector, despite being untariffed, has also been pulled into the turbulence, with reduced logistics, tourism, and agri-supply chain investments. For Africa, and South Africa specifically, these shifts are not background noise.
As a country with 100% binding coverage under WTO disciplines and applied MFN tariffs averaging just 7.5% on agricultural goods, South Africa now faces the disproportionate burden of compliance without the privilege of predictable market access.
From the lens of the Gravity Model of Trade, bilateral trade volumes are strongly influenced by market size and inversely by trade costs, including tariffs. A 30% tariff by the U.S. sharply increases trade frictions, lowering South Africa’s export potential even to those buyers who previously had a comparative advantage in sourcing from us.
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Sectoral vulnerabilities
Further, New Trade Theory suggests that economies of scale and product differentiation – central to South Africa’s citrus, wine, and processed goods industries – can be undermined by sudden tariff hikes. A 30% duty on citrus, for instance, may erase smallholder margins and render premium products (e.g., cold-pressed oils, wines, macadamia exports) uncompetitive, especially where no trade preference exists.
A sectoral breakdown reveals concentrated risk, not only due to the consistent U.S. market access provided by Agoa, but also because of strong US demand for South African commodities. Take macadamia, for instance.
Exporters already face global oversupply, and a US tariff would further erode margins for this premium nut, impacting smallholders in Limpopo and Mpumalanga. This directly affects jobs and agribusiness profitability. Wine, too, is under pressure from non-tariff barriers in the EU and shipping delays in Asia; the US offers a critical growth outlet.
A 30% tariff adds price volatility to an already saturated market. Now consider citrus. South Africa is the world’s second-largest citrus exporter, with the US a key destination. A 30% tariff may shift volumes to lower-value markets, increasing cold storage and logistics costs, losses that the industry cannot absorb.
The citrus industry would be severely hit, like the others mentioned. It’s critical to expand on citrus. South Africa exported over 164 million cartons in 2024, with the US taking 4% – around 6.58 million cartons or $119 million in value.
Yet, the US’s decision to impose a 30% tariff on South African citrus, while applying only 10% to Southern Hemisphere competitors like Chile and Peru, creates a damaging asymmetry. This comes amid rising US demand due to local shortfalls.
Florida’s orange crop is down 33%, and US orange juice output is at its lowest in 88 years. Despite this demand, South African growers face added barriers, such as continued exclusion of citrus black spot (CBS)-affected areas, despite similar waivers for others.
Moreover, the potential expiry of Agoa in September 2025 adds legal uncertainty to an already strained trade relationship. South Africa risks being priced out of a premium, supply-constrained market, despite offering counter-seasonal, high-quality fruit. The current climate reveals the structural vulnerability of an industry reliant not just on comparative advantage, but on fair, rules-based market access.
Staying resilient amid trade turbulence
It is crucial to stay optimistic and develop strategies to overcome Trump-era tariffs. Despite major challenges, South African agriculture remains resilient, coordinated, and too important to fail.
Firstly, South Africa can initiate consultations under the WTO Dispute Settlement Understanding (DSU) if the tariff breaches Most Favoured Nation (MFN) rules or undermines prior concessions. There are precedents where agricultural exporters successfully contested unfair safeguards and Section 232 tariffs.
Secondly, the sector must boost efforts to deepen regional trade under the African Continental Free Trade Area (AfCFTA). South Africa must lead in promoting intra-African trade. With AfCFTA now operational, diverting agricultural exports to Africa, currently under 12%, is feasible. But this depends on infrastructure upgrades, SPS standard harmonisation, and logistics improvements to position Africa as a strategic alternative for market expansion.
This is one solution among many; global market access must also be prioritised, alongside ongoing engagement with US counterparts to seek amicable resolutions.
Thirdly, South African agriculture should shift toward value addition and local processing. Trade friction hits raw commodity exports hardest. Agro-processing and product transformation, supported by DTIC’s schemes and IDC grants, can cushion the blow of tariff-induced demand drops. Cross-departmental coordination is essential to protect the sector.
Last but not least, South Africa’s G20 presidency provides a platform to address global trade barriers. The country can also leverage Brics to advance its trade diplomacy.
The reality for export-focused farmers
According to World Tariff Profiles 2025, countries like Eswatini, Botswana, and Namibia, linked to South Africa through Sacu, face similar tariff exposures and resulting spillover effects. This is not just a national issue, but a regional and broader global crisis.
The rise in protectionism highlights the urgent need for evidence-based trade policy in South Africa. As tariffs become geopolitical tools rather than economic ones, developing countries must boost regional cooperation, trade resilience, and domestic productivity. For South Africa’s farmers, especially export-oriented horticultural producers, the choice is clear: adapt or retreat.
With smart policy, institutional coordination, and WTO engagement, the sector can stay competitive, inclusive, and globally relevant despite shifting trade dynamics. Given agriculture’s past resilience, there is strong optimism that this challenge, like others before it, can be overcome.
- Buhlebemvelo Dube is an economist for trade research at the National Agricultural Marketing Council (NAMC). The views and opinions expressed in this article are those of the author and do not necessarily reflect the views or positions of Food For Mzansi.
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