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The South African Revenue Service published Notice R.7739 in Government Gazette 55065 on 24 July 2026 amending Part 1 of Schedule No. 1 to raise the general rate of customs duty on peanut butter classified under tariff subheadings 2008.11.11, 2008.11.15 and 2008.11.19. According to ITAC Report 652 the adjustment followed an application from RCL Foods (Pty) Ltd, producer of the Yum-Yum brand, which had initially sought a 25 percent rate. Imports from the European Union, United Kingdom, EFTA states and SADC members remain duty-free under existing trade agreements while those from ACFTA origins now face an 8 percent rate. The Commission ultimately settled on 20 percent after evaluating the full record.
ITAC’s investigation found that domestic peanut butter production within the Southern African Customs Union had declined amid softer demand, lost contracts and intensified competition from lower-priced imports. Sales volumes for leading manufacturers including RCL Foods and Tiger Brands fell while capacity utilisation dropped even though facilities retained potential for expansion. Import volumes rose by an average 15 percent annually with an 81 percent surge recorded in 2024, the report showed, and India supplied 95 percent of those imports that year. Imported peanut butter carried prices 19.3 percent below local equivalents, ITAC data indicated.
Domestic groundnut output, which supplies roughly 55 percent of commercial volumes to peanut butter processors, increased 11.6 percent in the 2024-25 season above a five-year average of 56,004 tons with a longer-term annual average near 62,000 tons. SACU peanut butter consumption stood at approximately 60,400 tons in the 2024-25 period, ITAC Report 652 noted. The Commission concluded that the former specific duty of 0.99 cents per kilogram created a misalignment with the 10 percent tariff on raw groundnuts that discouraged local value addition and weakened industry viability.
Peanut butter accounts for about half the spreads market excluding margarine and functions as a key protein source for low-income households, remaining zero-rated for value-added tax and included in standard food baskets. ITAC stated, “ITAC recommended that the general rate of customs duty on peanut butter be increased from 0.99c/kg to 20% ad valorem, to provide a more appropriate balance between supporting domestic manufacturing, encouraging value addition, and maintaining consumer affordability.” The Commission received two supportive comments, three objections focused on potential price effects for consumers and additional preliminary submissions during the process.
The Commission has self-initiated an investigation under Section 16(1)(d)(ii) of the International Trade Administration Act into a temporary rebate facility for imported groundnuts to lower input costs for local manufacturers. This step builds on an earlier 2020-21 application that did not produce a duty change and on the updated December 2024 submission from RCL Foods. The rebate probe aims to address remaining value-chain distortions while the new tariff takes effect immediately upon gazetting.
The global peanut butter market reached 6.2 billion US dollars in 2023 and is projected to expand to 9.76 billion dollars by 2030 at a compound annual growth rate of 6.7 percent, figures cited in ITAC Report 652 show. The tariff adjustment and complementary rebate review together seek to restore competitiveness for South African producers who had faced rising raw-material, labour and overhead costs that eroded profitability for at least one major participant. The Commission indicated the measures would support the broader groundnut value chain without imposing excessive burdens on household budgets.
