While new US tariffs on other countries may have little direct impact on South African agriculture, economist Wandile Sihlobo warns that US farmers could shift their exports to alternate markets, increasing competition for SA producers.
The first round of US President Donald Trump’s tariffs on China, Mexico and Canada (if implemented) would probably have a “minimal” impact on South African agriculture, according to agricultural economist Wandile Sihlobo.
However, he warned that retaliatory tariffs by China and others could result in US producers looking for alternative markets for agricultural products, raising competition for South Africa’s farm exports.
“The major risk is when the US farmers divert their products from China, depending on the level of Chinese retaliation tariffs, to South Africa’s traditional markets in the Far East. This could further recreate more competition and downward price pressures. This is something we will have to monitor closely.
“Similarly, the US fruit, wine, and fruit juice exports could also start looking to widen their export markets to areas similar to South Africa, which would present more competition,” Sihlobo said in his blog.
“Anyway, I remain optimistic that the current US tariffs will have minimal direct impact on South Africa, and the confrontation seems far from us.
“Whether the US imposes any other import tariffs that could directly affect the South African farming community in future remains to be seen. We live in strange times and can’t be sure of anything these days,” he stated.
