Notes on South Africa’s Wheat Import Tariff

The movements of the international wheat prices will be of importance in the local market this season. This is not only due to their influence on local wheat prices, but also their implications on the import tariff. South Africa’s wheat import tariff is currently at R716.30 per tonne. A new import tariff level can only trigger when international wheat prices deviate by more than US$10 per tonne from the base price for three consecutive weeks.

Over the past two weeks, the international wheat prices consistently traded higher than the base price of US$218.00 per tonne by more than US$10 per tonne. If this trend continues for another week, a new wheat import tariff, which would be less than the current rate of R716.30 per tonne, could be triggered.


A bit of context — the recent uptick in international prices was largely underpinned by concerns of dryness in the U.S. Plains. However, the recent monthly report from the United States Department of Agriculture somewhat eased the fears of possible crop damage. The agency left its 2017/18 US wheat production estimate unchanged from last month at 47 million tonnes.

Moreover, the agency revised its 2017/18 global wheat production estimate up by 0.2% from January 2018 to 758 million tonnes. This is 1% higher than the 2016/17 production season. These developments suggest that the international wheat prices could slightly decline from levels seen in the past few weeks as the market is well supplied. Such a scenario would break the price trend observed in the past two weeks, and thereafter the prospects of a change in the South African wheat import tariff.

The wheat import tariff is of importance as South Africa’s 2017/18 marketing year wheat import estimate is the second largest on record, estimated at 1.9 million tonnes. The country has thus far imported 40% of the seasonal import forecast, which makes trade matters vital as a large share of wheat is yet to be imported.

Author: Wandile Sihlobo

Wandile Sihlobo is an agricultural economist and head of agribusiness research at the Agricultural Business Chamber (Agbiz) in South Africa. He is a columnist for Business Day and Farmers Weekly magazine. Sihlobo is a member of the South African Agricultural Economics Association. He has previously served as an economist at Grain South Africa. He holds a Master of Science degree in Agricultural Economics from Stellenbosch University.

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