South Africa's Premier Group to Close Tulbagh Canning Plant in August, 424 Jobs at Risk

en.Wedoany.com Reported - Premier Group plans to close its canned fruit factory in Tulbagh. Trade unions have warned that this move will disrupt an agricultural export supply chain supporting over 200 fruit producers, transport operators, and other service providers; approximately 90% of the factory's canned fruit output is destined for export, putting 424 jobs at risk.

Premier Group attributed its decision to initiate Section 189 retrenchment proceedings at Fruit Products Western Cape to global oversupply, increased US tariffs, uncertainty surrounding the African Growth and Opportunity Act, exchange rate pressures, and consolidation within the canned fruit industry.

The Congress of South African Trade Unions (COSATU) and several signatories have urged Premier Group to suspend retrenchment consultations for 12 to 24 months to allow for the exploration of alternatives to closure. COSATU Western Cape Provincial Secretary Malvern de Bruyn told Freight News ahead of an August 26 meeting that the union intends to discuss proposals contained in an open letter sent to the company.

The open letter, signed by COSATU and its affiliated unions—Solidarity, the National Union for All Sectors—as well as the Canning Fruit Producers' Association, is addressed to Premier Group CEO Kobus Gertenbach, Chairman Iaan van Heerden, and shareholders including Christo Wiese, Brait, and Allan Gray.

The signatories warned that closure would have a ripple effect across the entire supply chain, impacting communities such as Tulbagh, Saron, Gouda, Wolseley, Ceres, and Hermon, affecting local businesses and thousands of workers. The letter reads: "We write on behalf of their families, and in the interests of farmers, contractors, transport operators, service providers, local businesses, and thousands of workers and others whose livelihoods depend on the economic ecosystem sustained by this factory." The signatories argue that the 60-day period stipulated by the Section 189 consultation process is insufficient to consider alternatives to closure, and that a two-year suspension is not an unreasonable request, providing stakeholders with the time and space to determine how to save, sell, recapitalize, repurpose, or operate the factory under a different business model.

The signatories also noted that the Competition Tribunal approved the merger between Premier Group and RFG in March 2026, with conditions attached relating to merger-related retrenchments; Premier Group has not yet demonstrated to the Competition Commission that the proposed retrenchments are unrelated to the merger. The unions believe that signalling the proposed closure before obtaining Competition Commission approval could damage the factory's commercial prospects, making it harder to rescue.

The letter states that the approximately 200 to 220 fruit producers supplying the factory may be forced to remove orchards, seek alternative crops, and establish new production, packaging, and distribution arrangements. The signatories stated that closure would hit farms, transporters, contractors, input suppliers, machinery suppliers, engineering firms, service providers, retailers, and other businesses in Tulbagh, as well as all their employees and surrounding communities; the loss of the factory's industrial capacity could be permanent, with equipment potentially sold off and workers' skills and institutional knowledge lost as a result. Deciduous fruit trees typically have a lifespan of 20 to 30 years, and once orchards are removed, they are difficult to restore quickly. The signatories called on potential investors and producers to be given time to explore ownership or investment options, and urged the government to study trade, tariff, and fiscal support measures.

Premier Group stated on Tuesday, August 25, that it had begun consultations with affected employees and recognised representatives regarding the proposed orderly closure of the business. The company said the process is ongoing and that it continues to engage with relevant parties; as consultations have not yet concluded, it is premature to comment on outcomes or further details at this stage.