A recently published proposal aimed at strengthening tariff protection on local wheat instead only protects brown wheat flour.
A request for comment by the International Trade Administration Commission (Itac) on stronger tariff protection for locally produced wheat against cheap and low-quality imports only protects brown flour, which makes up 0.39% of total wheat exports.
The new tariff, published by Itac, raises the reference price at which protective tariffs on wheat are activated or deactivated.
Currently, the tariff is activated when the average international price of wheat over three weeks is more than $279 per tonne. Grower association Grain SA and the SA cereals and oilseeds trade association (Sacota) have applied for the tariff to be raised by $10 per tonne.
“When the global wheat price dips below the reference price for a particular period, the duty will then be calculated. The duty will be calculated as the difference between the reference price and the market price,” explained Donald MacKay, director at XA Global Trade Advisors, during a recent webinar on the tariff. “And if the global price drops, the size of the duty goes up.”
On the other hand, “if you raise the reference price, then the global price will be more frequently under that reference price than over it", he said.
MacKay pointed out that wheat imports comprise two product categories – the wheat itself and wheat flour.
“If we look at (Grain SA and Sacota’s) application itself, it asks for protection on wheat as well as flour. But the flour duty is a derivative of the wheat duty. So the flour is whatever the wheat duty is, times 150%, then that will give you the tariff on flour.”
While the grain industry applied for an increased dollar-based reference price on tariff codes HS 1001.9x, which is wheat, and HS 1101.00.xx, which is wheat flour, Itac’s gazette only mentions HS 1101.00.10, which is the tariff code for brown flour.
“(The tariff on) flour cannot be changed independently of the wheat tariff itself. And this is quite an important problem for Itac to fix. They need to republish the Gazette (with) the correct tariff codes. It is not clear to me that they could alter the duty on wheat when they’ve only called for comment on flour.”
Only 8 358 tonnes of brown wheat flour were imported between April 2024 and March 2025, compared to 50 035 tonnes of other wheat flour, and 2.1 million tonnes of wheat.
