Peach farmers offered cash to end Tulbagh cannery contracts

Pink peach blossoms on a farm outside Tulbagh. Photo: Greg Dor

The Premier Group is offering Western Cape peach producers R3,250 per tonne to settle their supply agreements as it closes its Tulbagh fruit-processing factory.

Producers who accept the offer will receive payment by the end of October but will give up contractual rights.

The offer, communicated by the Premier Producer Committee, comes as more than 200 producers with about 2,000 hectares of orchards face uncertainty over where their fruit will be processed.

The settlement applies to contracted peach tonnage according to each producer’s delivery quota.

Charl Herbst, chair of the Canning Fruit Producers’ Association negotiations committee and a mixed-fruit farmer from Tulbagh, described it as a voluntary commercial settlement.

“Whether it is regarded as adequate or not will differ from producer to producer, and producers are currently evaluating the offer and taking advice before deciding how to respond,” Herbst said.

The Producer Committee said it was communicating the offer but making no recommendation for or against it, encouraging producers to obtain independent legal or commercial advice.

Premier acquired the Tulbagh facility earlier this year as part of its R6.5-billion acquisition of RFG Holdings and announced it would not be reopened for the 2026/27 harvest.

The closure has triggered Section 189 retrenchment proceedings involving 424 factory workers.

The Tulbagh cannery processed about 55,000 to 60,000 tonnes of fruit a year and bought about R300-million worth of produce from farmers, according to the CFPA, AgriSA and Agri Western Cape.

The factory processes several types of fruit, including peaches, pears, apricots and guavas.

The peach offer raises questions about what arrangements will be made for producers of other fruit supplied to the factory.

The company has said the decision to close the factory is due to a long-term decline in global demand for canned fruit and deteriorating export conditions. Premier has rejected claims that the closure is related to the acquisition of RFG.

The Competition Commission is investigating the closure following a complaint concerning possible breaches of conditions attached to the acquisition.

Premier has said it plans to process some fruit into pulp and purée at its Groot Drakenstein facility. It has also said it is in discussions about the possible sale of the Tulbagh factory or the transfer of supply agreements to Langeberg Foods.

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