JSE-listed Nutritional Holdings has temporarily halted exports to Germany and the United Arab Emirates.
Nutritional Holdings concluded a R1.26 billion three-year contract in the beginning of January 2021 with GIH Distributors for the supply of its "immune-booster product" to Germany. As part of the contract, it will supply 50 000 units a month to GIH, set to increase to 200 000 units a month in the third year.
Further, the group also concluded a two-year contract with Grosvenor Supplements FZCO in the United Arab Emirates which started in April, and is worth R776 million.
But on Monday, the company said it has been "instructed by its customer to temporarily halt supply." This was due to "concerns regarding the supply chain including packaging and supply requirements and transit restrictions as a result of the increase in South Africa’s Covid-19 statistics which could result in the product needing to be chemically sanitised and quarantined".
The company, which supplies cannabis products, said in a statement to shareholders on Monday that tests are currently under way in respect of the the decontamination processes and its effect on the products; the survival rate of the virus while in transit; post-delivery testing in respect of products fit for human consumption after decontamination.
The group said it is unclear at this stage as to the time frame of the pause.