Black Friday for Wheat: But Producers Don't Get Any Specials

28 Nov 2025

Grain SA Warns of Critical Conditions in the Wheat Industry

Grain SA warns that the sustainability of South Africa’s wheat industry is in serious jeopardy, with producers facing escalating input costs, suppressed international prices and insufficient market protection. The organisation calls on all stakeholders in the upstream and downstream value chain - including the public - to urgently confront this growing crisis.

Grain SA appeals strongly to government, the value chain and consumers: the South African wheat industry is in a state of crisis. Rising input costs, depressed global prices and a tariff system that does not keep pace with market realities are pushing producers to the brink of financial collapse. If intervention is delayed further, local production may scale down irreversibly.

Tariff Development: R616/ton Trigger Activated

On 27 November, an import tariff of R616/ton was triggered, and the Government Gazette process was activated through SAGIS.

This follows a final presentation by Grain SA and SACOTA to ITAC’s chief commissioners in October. The application—seeking an adjusted reference price and an automatic trigger mechanism—was submitted in June 2024 and now awaits finalisation.

Wheat Industry in a Critical State

According to Richard Krige, Chairperson of Grain SA, current market conditions and cost structures are simply not sustainable for local producers. “Bread is a staple food for millions of South Africans, yet few realise that the farmers producing this essential crop are under immense pressure,” says Krige. “With production costs of around R16 000 per hectare and a break-even point of at least 3.4 tons per hectare, current price levels are not viable.”

Key Facts About the Industry’s Impact

• Wheat accounts for only 18% of the cost of a loaf of bread.
  On a loaf costing R17.92, the farmer receives just R3.23.
  Thus, an increase in the wheat price would not significantly affect the price of bread.
• The industry supports approximately 12 600 jobs, of which 73% are in the Western Cape.
  This excludes additional employment created by other value chain partners such as input suppliers, silo operators and logistics providers.
• A collapse in local wheat production could cost consumers up to R643 million more per year to maintain the same quality of bread.

Urgent Actions Required

Grain SA highlights five priority interventions requiring immediate attention:

1. A more effective import tariff system

• An adjusted reference price
• An automatic trigger mechanism
• The current application is being delayed by resistance from the milling industry to changes in the reference price

2. Restrictions on imports during local harvest

Large volumes of imports just before and during harvest artificially suppress local prices and undermine producers’ income.

3. Modern genetic and production technologies

• Regulations governing new breeding techniques must be updated
• Including white wheat in the national basket will strengthen diversification and yield stability

4. Production support and risk management

• Subsidised crop insurance
• A fairer location differential system on SAFEX

5. Restoration of effective transport and logistics systems

The cost of poor logistics is borne directly by both producers and consumers.

“If producers fall, the entire value chain falls”
Krige warns that the window for action is rapidly closing: “Without decisive and coordinated intervention from government and the full value chain, the wheat industry faces a real threat to its survival. If producers fall, the whole chain falls – and ultimately consumers and rural economies pay the price.”

 

Ends

Issued by:  Grain SA Communications

Further enquiries:
Richard Krige, Chairperson, Grain SA
boontjieskraal@com2000.co.za