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JIMMY MOYAHA: On the afternoon of Friday, July 31, 2026, South Africa published its trade statistics, indicating a trade surplus of R17 billion for June. This is a positive shift from the trade deficit seen in May.
To explore this further, we have Investec economist Lara Hodes on the line to discuss these updates. Lara, it’s wonderful to have you join us. Thank you for being here.
This year, South Africa has successfully maintained a trade surplus, especially during a time filled with uncertainties in trade relations. The latest numbers support the notion that we are set for a strong year ahead.
LARA HODES: Absolutely. The surplus of slightly above R17 billion was indeed unexpected.
Initially, analysts had predicted a slight deficit. Last month’s data was revised; it initially indicated a minor deficit but was updated to showcase a surplus. This recalibration impacted the overall figures.
However, it’s definitely a positive development for the economy.
The surplus was primarily propelled by stronger-than-anticipated export performance, combined with reduced import values.
We saw a decline in oil prices following the memorandum of understanding signed between the US and Iran on June 18, which worked in our favor as we are net importers of petroleum products.
Moreover, export figures have outperformed expectations. Global manufacturing conditions have remained strong during this period. Initially, there was significant inventory accumulation due to anticipated price increases, but that trend is fading.
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This explains why we didn’t anticipate such a robust month-on-month export performance, yet the outcome is certainly favorable.
JIMMY MOYAHA: Lara, reviewing data from the past two years around this time – June and July – we observe that figures are lower compared to those from 2024 and 2025.
The data demonstrates a pattern of consistency in South Africa’s trade performance in the latter half of the year. Generally, the year begins with a strong surplus, with occasional months experiencing significant deficits.
Given the ongoing trade discussions, the current surplus seems to suggest that South Africa is prepared to manage the challenging trade dialogues as they emerge throughout the year.
LARA HODES: To a degree, yes. However, there are several risks to consider. The recent global oil shock has affected the market. As I mentioned, following the June memorandum of understanding, oil prices decreased, while our export resilience exceeded expectations.
Crucially, we’ve observed significant improvements in logistics at the Durban Port under Transnet, which has boosted export activities.
This is an important aspect to highlight.
Nonetheless, risks still linger.
The rand has demonstrated greater resilience compared to past oil price shocks, which is encouraging. However, the geopolitical situation in the Middle East remains uncertain and volatile.
We saw a spike in oil prices again after tensions escalated following the MoU, but that seems to have lessened with [US President Donald] Trump’s recent choice not to engage Iran militarily at this time.
Thus, it is evident that South Africa is in a more favorable position now than before.
We’ve moved off the grey list, and various reforms have been enacted. We are indeed in a better position, but risks still exist.
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JIMMY MOYAHA: Lara, as we wrap up, I’d like to discuss the path forward, keeping in mind that some of these risks are beyond South Africa’s control and influence both imports and exports.
From a South African perspective, it’s essential to improve logistics through agencies like Transnet if we wish to optimize exports in our trade balance.
What measures can we implement to ensure South Africa’s trade balance remains in surplus and possibly widens that surplus moving forward?
LARA HODES: Absolutely. We must continually enhance our export competitiveness.
We are fortunate to possess significant mineral and commodity resources.
If global economic conditions improve, there will undoubtedly be a rise in demand for our commodities, which is crucial.
Therefore, if geopolitical tensions diminish, we can look forward to strong global growth, resulting in elevated demand for our exports.
We have made significant, positive strides, but ongoing improvements in logistics will greatly enhance our export potential in the future.
JIMMY MOYAHA: South Africa has achieved a trade surplus for June, and all indicators imply that even with challenging trading conditions and existing market risks, South Africa is advancing positively in terms of trade.
We will conclude on that note. Investec economist Lara Hodes has been with us, sharing insights into South Africa’s trade surplus data released on Friday and its impact on our imports and exports.
