Trade conditions remained under pressure in June, according to the South African Chamber of Commerce and Industry (SACCI) Trade Conditions Survey – June 2026 released on Tuesday.
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Trade conditions remained under pressure at a seasonally adjusted 36 points in June, according to the South African Chamber of Commerce and Industry (Sacci) Trade Conditions Survey released on Tuesday.
However, experts believe that conditions may improve later in the year.
Sacci said that the war in the Middle East negatively affected trade conditions as it impacted fuel supply and rapidly rising crude oil prices.
“Crude oil prices peaked at some $119 (R1,960) at the end of April 2026. This had a marked effect on not only fuel prices at the pump but escalated throughout the supply chain with a pronounced effect on the inflation rate.”
Sacci added that this development had a direct effect on spending patterns of households and the costs of businesses.
“Therefore, 75% of respondents to the April 2026 Survey recorded a rise in input costs. With the crude oil price returning to about $72 (R1,187) at the end of June 2026, it had positive effects on business and particularly general trade conditions in June and improved trade expectations,” Sacci said.
“Inventories, backlog on orders and input prices turned positive in June. All the other components of trade declined marginally since May and stabilised in June.”
Sacci added that apart from lower input costs, sales prices remained virtually stable in June, although the general price level (inflation) partially started to reflect the full fuel price impact in May.
“The lower sales volumes and new orders for May and June indicate the real effect of the rising fuel prices and their effect on spending patterns in the economy. Expected trade conditions moved firmly back into positive mode for the next six months according to the June 2026 Survey.”
Sacci said that the gap between present and expected trade conditions remains wide, but the much lower crude oil and pump prices spurred positive expectations after the serious dip in the Trade Expectations Index in April.
“According to the latest released data, consumer inflation increased to 4.5% in May 2026 while producer inflation measured 4.3%.”
Sacci concluded that the current weaker trade conditions led respondents to employ less staff, although 31% still hired staff in June.
“Given expected improved trade conditions in the next six months, respondents intend to increase employment with the expected index increasing to 57 in June from 40 in April (the peak of high crude oil prices).”
Professor Raymond Parsons, an economist at North West University Business School, said that the latest Sacci trade conditions confirm other high-frequency data about the negative impact of the global energy crisis on second quarter business activity.
“When the macro figures become available later, GDP growth in the second quarter is likely to have suffered significantly. Both growth and employment have been negatively affected in the past few months. But this economic pain, while unfortunate, may nonetheless be temporary.”
Parsons added that the good news is that survey respondents expect business conditions to improve later in the year, given the intrinsic resilience of the SA economy.
“The strength of the anticipated business recovery will also depend on factors such as the degree of further escalation in the Middle East conflict and how the economy reacts to the further interest hike expected from the SA Reserve Bank on Thursday.”
Professor Simphiwe Madikizela, an economist at the University of South Africa (Unisa), said this is a very serious concern for trade conditions that will remain negative for as long as this war continues.
Madikizela saidd the effects of the Middle East war will be seen and continue to be experienced for years to come even after it has ended, as the infrastructure that is destroyed has to be rebuilt, which costs a lot of money to finance, and the lives of people that are lost will not come back.
Unisa economist Dr Eliphas Ndou said that the latest developments in the Middle East have heightened uncertainty in oil prices.
“The latest instability, which is raising oil prices, is bad news for consumers and companies. Households and companies will revise their inflation expectations upwards,” Ndou said.
“These revisions affect investment planning, making it more difficult to allocate the budget to projected investments and introducing greater uncertainty about the repo rate's path.”
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