Business

72-year-old R1 billion factory officially shutting down in South Africa

Malcolm Libera

 ·15 Sep 2026

Following a comprehensive assessment of the Fruit Processing Western Cape (FPWC) business and the global fruit-canning industry, Premier Group has decided not to reopen its cannery for the upcoming harvest season.

This was announced by Premier Group Limited’s trading statement for the six months ending 30 September 2026. 

The FPWC is a large fruit-processing operation in the Western Cape that has been affected by deteriorating conditions in the global canned-fruit industry.

In its trading statement, Premier said its board had decided in July not to reopen the factory for the upcoming harvest season after a detailed assessment of the business and international market.

Premier said the decision was driven by long-term structural problems in the global industry.

“The industry has been in long-term decline, with canneries closing globally as demand for canned fruit products has dramatically decreased,” the group said.

FPWC’s problems have been particularly severe because it relies heavily on international markets. Premier said approximately 90% of the factory’s production is exported, but those prospects have deteriorated rapidly.

“The export prospects of the FPWC business, which exports approximately 90% of its production, have deteriorated rapidly to the point where the facility is no longer economically viable,” Premier said.

The factory has a history stretching back to the 1940s, when it began operating as SA Preserving. By 1954, it had developed into an established fruit-processing plant.

The operation later expanded under Del Monte Fruits South Africa and became an important export facility supplying markets in Europe and North America.

Rhodes Food Group acquired the business in 2010 and renamed it Fruit Products Western Cape. 

RFG subsequently invested hundreds of millions of rand in upgrading the facility, including automated canning lines, expanded cold storage and increased processing capacity.

These investments helped turn the Tulbagh operation into a substantial industrial asset, with the value of the factory and related assets estimated at around R1 billion.

Expect strong results despite FPWC closure

The facility became part of Premier this year after the consumer goods group completed its R6.5 billion acquisition of RFG Holdings and delisted the company.

Premier, however, stressed that the closure decision was not caused by the acquisition.

“The proposed closure of the FPWC facility is solely as a result of the significant structural economic challenges affecting the global fruit-canning industry and is thus independent of the RFG transaction,” it said.

Premier has initiated a Section 189 consultation process affecting 424 employees. It also remains open to selling the operation as a going concern.

“Premier remains open to engaging with parties interested in acquiring the FPWC business as a going concern,” the group said.

The company is also negotiating with Langeberg Foods, South Africa’s other deciduous-fruit cannery, to potentially transfer a significant portion of FPWC’s fruit-supply contracts and provide equipment.

Premier said it would process as much fruit as economically viable into pulp and purée at its Groot Drakenstein facility.

It will also compensate producers for contractual shortfalls between the fruit volumes they agreed to supply and the volumes ultimately processed.

The Tulbagh site has also been made available for possible repurposing into alternative products if viable global markets can be found. The closure comes as Premier reports strong overall financial growth.

Revenue for the six months to September is expected to rise by 35% to 45%, largely due to the RFG acquisition, while headline earnings per share are expected to increase by 22% to 32%.

Premier expects the FPWC decision to result in financial losses as it manages the consequences, although it does not expect this to materially change its overall financial guidance.

The closure is also being examined by the Competition Commission after a complaint from the South African Clothing and Textile Workers’ Union.

The investigation concerns whether retrenchments at FPWC could breach the three-year no-retrenchment condition attached to the RFG acquisition, which was approved in March 2026.

Premier said it is fully cooperating with the investigation.

Here is a summary of the key financial metrics and share capital figures reported in Premier’s trading statement for the six months ending 30 September 2026 (H1-FY2027):

Key Financial Results & Forecast Guidance