Retrenchment could cripple Tulbagh’s economy, ‘weaken agricultural production and breach merger commitments’
Premier Foods brands include Blue Ribbon Classic white bread. Picture: (supplied)
Labour federation Cosatu has called on JSE-listed food manufacturer Premier Foods to suspend a retrenchment process, warning that it could affect thousands of jobs across the agricultural value chain, weaken agricultural production and devastate businesses in Tulbagh and surrounding areas of the Western Cape.
The call follows Premier Foods’ announcement last week that it plans to close the Rhodes processing plant after completing its merger with Rhodes Food Group Holdings in March.
Cosatu said the move would affect 300 permanent employees and about 2,000 seasonal workers, stressing that 80,000 jobs were at stake across the agricultural value chain.
Premier Foods, which owns brands including Blue Ribbon, Mister Bread, Impala Maize Meal, Bull Brand, Rhodes and Snowflake, secured approval for the merger from the Competition Commission subject to conditions. These included an undertaking not to implement retrenchments for three years, Cosatu Western Cape secretary Malvern de Bruyn said on Tuesday.
Read: Premier CEO Kobus Gertenbach earns R17.4m bonus after record year
On March 1, Premier said the merger marked an important step “in bringing together two businesses with strong brand portfolios, deep manufacturing capability and a shared commitment to long-term growth”.
“Based on results for the 12 months to September 30 2025, the combined entity will generate revenues of approximately R28.6bn and employ more than 15,500 people across South Africa, Eswatini and Mozambique. Following final implementation, [Rhodes Food Group] will delist from the JSE and become part of the Premier Group,” it said.
De Bruyn said the closure of the Rhodes processing plant would destroy an estimated 80,000 jobs in the value chain.
“Retailers, suppliers, transport operators and many other enterprises depend on the continued operation of the plant. This reckless decision threatens the economic future of the entire region,” he said.
Cosatu’s demands were that the processing plant remain operational, there be no retrenchments and no removal of machinery from the plant, and the Competition Commission determine whether the proposed closure violates the “commitments made when Premier acquired Rhodes, including undertakings relating to employment protection”.
Premier also needed to disclose the financial and operational information underpinning its decision to close the Tulbagh plant and a comprehensive socio-economic impact assessment must be conducted to determine the “devastating consequences that closure would have on workers, farmers, businesses and the wider Tulbagh community”.
De Bruyn said the labour federation would engage Premier Foods’ shareholders, the department of trade, industry and competition, the office of the Western Cape premier and all relevant stakeholders to secure a sustainable solution that protects jobs and preserves industrial capacity in Tulbagh.
“The federation also calls on companies throughout the agricultural value chain to oppose decisions that undermine local production and threaten thousands of livelihoods.
“Should Premier insist on exiting the operation, Cosatu believes the facility should instead be sold as a going concern to a consortium capable of preserving production, protecting jobs and advancing worker ownership.”
He said government development finance should be explored to support such an initiative, while workers must have an equitable stake in the future ownership of the enterprise.
“The unity demonstrated by workers, farmers and the community sends a powerful message that Tulbagh will not stand by while corporate greed destroys its economic future.
“Cosatu pledges to stand solidly with the workers and the people of Tulbagh until this closure is defeated and the Rhodes processing plant remains a thriving contributor to the local economy,” De Bruyn said.
Responding to questions from Business Day, Premier Foods said in a statement: “Premier confirms that it has commenced a section 189 consultation process with affected employees and recognised representatives regarding the proposed controlled closure of its Fruit Products Western Cape business in Tulbagh.
“Premier recognises that this is a deeply difficult and uncertain time for affected employees, many of whom have given years of service. The company understands the impact that this process may have on employees, their families and the broader Tulbagh community and is committed to managing the process with care, respect and transparency.”
The company said the fruit products business was no longer economically sustainable in its present form, as it had been affected by sustained pressures in the canned fruit market. These included declining global demand, changing export market conditions, pricing pressure, rising input costs and the need for greater scale in an increasingly competitive global industry.
The company said about 90% of the fruit products business’s canned fruit production is exported, “making the operation highly dependent on global demand and international competitiveness. Demand has declined sharply, year on year.”
Premier said it was engaging with the Competition Commission, local and national government, and other interested stakeholders, including the remaining canning facility, to help lessen the impact on farmers, the community and employees. “The company will continue to approach the proposed controlled closure responsibly, lawfully and with respect for all those affected.”