Western Cape exports to the United States have declined sharply, with a 41% drop in the 12 months to July, resulting in a loss of nearly R7 billion. The decline is attributed to tariffs imposed on key industries such as fruit juice, grapes, wine, yachts, and citrus. According to figures supplied by the Premier's Office and Western Cape Department of Economic Development and Tourism, US-bound merchandise exports fell from R16.89bn to R10.02bn.
The decline in export value is significant, with fruit juice exports recording the biggest percentage fall, dropping 86% from R952.9m to R136.7m. Grapes fell 79% from R444.2m to R91.1m, while yacht exports more than halved, falling 55% from R1.4bn to R627.6m. Wine exports dropped 38% from R603.1m to R371.5m, and citrus fell 17% from R2.19bn to R1.82bn. These figures were sourced from SARS and Quantec.
The Premier's Office and Department of Economic Development and Tourism attributed the decline to agricultural products and related agro-processing industries being among those hardest hit in terms of trade volumes to the US. Some niche manufacturing industries were also affected. The province has been working to mitigate the effects of the tariffs, with the Western Cape Departments of Agriculture and Economic Development and Tourism, Wesgro, and various industry bodies identifying vulnerable industries and export commodities.
The Western Cape government has been engaging with its counterparts in the US and working with national government towards a positive diplomatic solution. Over the last 12 months, work has been done to lobby the Department of Trade, Industry and Competition and various US-based importers for support and tariff relief. This effort was successful for certain commodities, such as citrus.
Despite the decline in exports to the US, exporters are increasingly selling into other markets. Citrus exports to the rest of Africa increased by 17,800 tonnes, or 40%, while exports to Asia increased by 111,000 tonnes, or 21%. The value of grape exports to the rest of Africa increased by 30%, or R119m, while wine increased by 19%, or R184m, and yachts by 4%, or R5m.
The province reported that the gains in other markets had not yet replaced the losses in the US market, although yacht exports to Europe were showing growth. Despite the 41% decline in exports to the US, the value of Western Cape exports to all markets increased by 5.4% over the rolling period. This suggests that the province's export industry is diversifying and finding new markets.
The decline in exports has raised concerns about job losses, but the province did not provide figures on jobs. The Premier's Office and Western Cape Department of Economic Development and Tourism stated that their role is limited in addressing trade relations, which do not lie within the mandate of provincial government.
Key points
- Western Cape exports to the US declined by 41% in a year, resulting in a loss of nearly R7 billion.
- Agricultural products and related agro-processing industries were among those hardest hit by the tariffs.
- Exporters are increasingly selling into other markets, with citrus exports to Africa and Asia showing significant growth.
