Warnings of Rising Prices in South Africa Amid Iran War Supply Risks

By Al Mayadeen English

1 Jun 2026 15:42

Tiger Brands reported a marginal rise in half-year earnings, driven by revenue growth and improved margins, while warning of potential price increases amid economic fallout from the US-Israeli war on Iran.

South African food producer Tiger Brands has warned of rising price pressures ahead, citing ongoing supply chain disruptions linked to geopolitical instability, including the US-Israeli war on Iran.

The company also reported a marginal increase in half-year earnings, alongside plans for targeted price adjustments to offset expected cost pressures.

Tiger Brands reported a modest rise in headline earnings per share from continuing operations, increasing by 0.6% to 9.80 rand for the six months ended March 31, compared with a restated 9.74 rand a year earlier.

Revenue rose 1.3% to 17.9 billion rand ($1.10 billion), driven mainly by:

Volume growth of 2.6%

A price decline of 1.3%

On a like-for-like basis, excluding discontinued products and divestments, normalized volume growth reached 4.5%, reflecting resilient demand despite price sensitivity in the consumer market.

Stronger margins support profitability

The company’s gross margin improved significantly to 32.1%, up from 29.8%, supported by:

Lower raw material costs in key categories

Ongoing efficiency initiatives

Factory optimisation and improved production processes

Cost savings in recipes, packaging, and logistics

Operating income increased sharply by 26.1% to 2.1 billion rand, outperforming expectations due to stronger margins and additional logistics savings.

Tiger Brands noted that the consumer environment remains highly competitive, with households continuing to prioritise affordability. The company said pricing pressure remains a key feature of the market, even as volumes show signs of recovery in certain categories.

Geopolitical risks drive inflation concerns

Looking ahead, Tiger Brands warned that global geopolitical uncertainty, including the war on Iran, is likely to intensify supply chain disruptions in the second half of the 2026 financial year.

The company said these risks could affect:

Global supply chains

Transport and logistics costs

Consumer disposable income

Input prices across key production categories

Industry-wide concerns have also grown over rising energy, fertilizer, and shipping costs linked to the war, which are expected to feed into broader inflationary pressure in South Africa.

Targeted price increases and cost controls planned

To manage potential cost pressures, Tiger Brands said it will rely on a combination of:

The company stressed that these measures aim to limit the impact on profitability while remaining competitive in a price-sensitive market.

Tiger Brands declared an interim dividend of 430 cents per share, an increase of 3.6%, reflecting its improved earnings performance and stable cash generation.