South African farmers seek market in Nigeria, rest of Africa on rising US tariffs

South African agricultural exporters are expecting higher US tariffs to persist as the rift between Pretoria and Washington continues, and are seeking alternative markets on the continent.

This is according to Danie Dörfling, head of business development at Moore Infinity, who told Business Times that liberalised trade policies could boost intra-Africa trade volumes by 574% by 2030 compared to current levels — even without the African Continental Free Trade Agreement (AfCFTA) in effect.

“One of the things that this mitigates is the potential worsening of US tariffs. And there’s a clear concern within the agricultural sector, from acute and immediate, to structural and long-term. And the evidence … is that the sector is preparing for structural worsening … because of the US tariffs.”

Dörfling’s remarks come after South Africa held the first G20 Leaders Summit on the African continent. A protracted diplomatic rift with the US — characterised by discredited claims of a “white genocide”, and the imposition of unilateral tariffs — saw President Donald Trump skip the event.

Dörfling said the US has rolled back some categories of reciprocal tariffs for seasonal goods or goods that its domestic market cannot replace, such as citrus juices and macadamia nuts. However, this did not add up to a restoration of sector confidence. “The tariff volatility is now sort of a baseline expectation.

“The sector experienced three tariff regimes in nine months, pre-April to November. So this unpredictability makes long-term investment in the US supply chain untenable … Capital is now essentially stranded because of the tariff volatility.”

The sector experienced three tariff regimes in nine months, pre-April to November. So this unpredictability makes long-term investment in the US supply chain untenable … Capital is now essentially stranded because of the tariff volatility.

Trade data from last year showed that 16% of Africa’s total food trade was intercontinental — including staples such as sorghum, maize, beans, and meat — with estimates that this might account for 32% of intra-Africa trade, he said.

“Intra-Africa trade grew by about 12.4% in 2024. That reached $220bn. So, within this aggregate, food and agriculture products represent a disproportionately large share of that growth … Nigeria’s agriculture sector will grow by about $5bn by 2043 … followed by Sudan, and then Kenya and Algeria.

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“So, countries with existing processing capacity and strategic geographical positions create these processing hubs, which contract production from smaller deficit countries, and it creates economies of scale that drive productivity for continental-wide growth.”

Dörfling said there’s been a shift in agriculture investment strategies by development finance institutions on the continent — from financing individual farmers to targeting aggregators, large-scale trade groups, processors and logistics firms that have a network of smallholder farmers. “What the development finance institution have done of late has actively accelerated these blended finance structures and mobilisation of private capital.

“They have a nice flagship fund — the Dakar 2 compact frameworks — that represents a proposed $61bn envelope in blended finance directed at about 40 country compacts, and it’s focused on agricultural poles and agro-industrial zones.”

Speaking at a virtual roundtable of the South African Institute for International Affairs this week, Hannah Ryder, CEO of Development Reimagined, said if the G20 nations, especially the AU states, cared about multilateralism, they’d boycott US G20 events that exclude South Africa.

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