Grain SA has warned that South Africa’s wheat industry is facing a deepening crisis, with producers strained by rising input costs, suppressed global wheat prices and inadequate market protection measures indicating that sustainability of local production is now at risk and has urged government, industry players and the public to act swiftly to prevent long-term damage.
The autonomous and voluntary commodity organisation, in a statement, said the situation has reached a critical point and intervention cannot wait noting that farmers are operating under extreme financial pressure, and without urgent structural reforms, local wheat production could decline permanently.
On 27 November, an import tariff of R616 per ton was triggered and the Government Gazette process launched through SAGIS. This development follows a final presentation Grain SA and the South African Cereals and Oilseeds Trade Association (SACOTA) made to the International Trade Administration Commission (ITAC) in October.
Their application — submitted in June 2024 — called for an adjusted reference price and an automatic trigger mechanism to better align with market conditions. A decision is still pending.
According to Richard Krige, Grain SA chairperson, current market conditions are simply not feasible for producers trying to stay afloat.
“Bread is a staple food for millions of South Africans, yet few realise that the farmers producing this essential crop are under immense pressure,” he said.
With production costs estimated at R16 000 per hectare and a break-even yield of at least 3.4 tons per hectare, Krige warned that existing price levels do not support viability.
Grain SA highlighted the significant national impact of a failing wheat industry. Wheat makes up just 18% of the cost of a loaf of bread — meaning higher wheat prices would have limited impact on retail prices. On a R17.92 loaf, farmers receive only R3.23.
The industry supports about 12 600 jobs, 73% of which are located in the Western Cape, excluding thousands more in input supply, transportation and storage thus a collapse in domestic wheat production could force consumers to pay up to R643 million more per year to maintain bread quality.
The organisation outlined five urgent interventions needed to stabilise the sector:
• A more effective import tariff system — including an adjusted reference price and an automatic trigger mechanism, currently delayed by resistance within the milling industry.
• Restriction of imports during local harvest periods, which currently depress local prices artificially.
• Adoption of modern genetic and production technologies, updated regulation of new breeding techniques and inclusion of white wheat in national varieties for improved yield stability.
• Strengthened production support and risk-management tools, including subsidised crop insurance and a fairer location differential system on SAFEX.
• Restoration of efficient transport and logistics infrastructure, to reduce escalating costs borne by both farmers and consumers.
Krige cautioned that the window for action is 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,” he said.
