As South African exporters scramble to find a solution to the unilateral 30% tariffs announced by US President Donald Trump on South African goods, rooibos producers will leverage their larger export markets, including Japan and the EU, to soften the blow.
Dawie de Villiers, chairperson of the South African Rooibos Council (SARC), told TimesLIVE Premium that while producers hope the tariff will be scrapped, over the past decade the South African rooibos industry has worked to broaden its international footprint.
“Today, Rooibos is exported to more than 30 countries, with Japan and Europe among its largest markets. While the US tariff poses a challenge, the industry’s diversification strategy means it is not overly reliant on one market.”
He said while the industry is upbeat about its diversification strategy, it is well understood that entering and expanding into new markets takes time and investment, and tariffs like these make existing market access more complex.
The SARC is focused on research, generic marketing and addressing trade challenges in the industry. Trump announced a raft of “reciprocal” tariffs on a number of US trade partners in April, only to suspend them and implement them in early August.
Producers may face reduced margins, and some exporters could lose competitiveness against other herbal tisanes in the American market
— Dawie de Villiers, chair of the SA Rooibos Council
De Villiers said the US accounts for about 5% of South Africa’s annual Rooibos exports, equating to more than 400,000kg in 2024. While not the largest market for the industry, the US remains an important destination, particularly for Rooibos used in blends and specialty teas, he said.
“It is too early to quantify the full financial impact, but the introduction of a 30% tariff is expected to put downward pressure on Rooibos export revenues to the US. Producers may face reduced margins, and some exporters could lose competitiveness against other herbal tisanes in the American market.”
Addressing the Tokyo International Conference on African Development in Japan last week, President Cyril Ramaphosa said South Africa was a top global agricultural exporter, with strong sanitary and phytosanitary standards, with a growing range of high-value products.
“Globally, we are ranked the number one exporter of Rooibos tea, the number one exporter of macadamia nuts, the second-largest exporter of fresh citrus, and the fifth-largest exporter by volume of wine.”
According to Anton Mostert, the development chair of intellectual property at the University of Stellenbosch, the rooibos tea industry in South Africa is worth an estimated R600m. World Customs Organisation data shows production and sales reached 22,600 tonnes shipped to more than 50 countries in 2023.
Meanwhile, deputy minister of international relations and co-operation Alvin Botes, and deputy minister of justice and constitutional development Andries Nel held a virtual call with US deputy secretary of state Christopher Landau last week.
Dirco spokesperson Nelson Kgwete said the two sides had cordial discussions on issues of mutual interest and concern and committed to further engagements.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.