Sugar industry bitter about cheap imports

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‘And with an estimated 563 005 tons of imported sugar landed here in 2019/20, this comes at a staggering cost to the local industry of just more than R2-billion.’

So said SA Canegrowers recently. The organisation went on to explain that during the 2020/21 season, they expect importers to be ready to purchase record levels of cheap sugar that could pour into SA from other countries.

Eswatini alone is expected to produce about 715 000 tons of sugar, of which about 450 000 tons could find its way to the SA market, free of any import tariffs because of free-trade agreements within the Southern African Customs Union (Sacu).

The organisation noted a major increase in cheap sugar imports from countries such as Brazil and the United Arab Emirates, as well as other Sacu countries.

This has had an unavoidable impact on the competitiveness of the SA sugar industry, with a massive reduction in sales of local sugar over the past few years.

Therefore, it should come as no surprise that the problem of cheap imports threatens the sustainability of the local sugar cane industry, and with it the futures of 21 000 small-scale growers, 65 000 farmworkers as well as the 270 000 indirect jobs and the one million livelihoods that the industry supports.

The SA Canegrowers welcomed President Ramaphosa’s recent announcement that a key focus of the Economic Reconstruction and Recovery Plan (ERRP) will be improving localisation and supporting local producers, and is looking forward to play its part in supporting the ERRP.

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About the sugar industry masterplan that Trade and Industry Minister Ebrahim Patel gazetted in June, SA Canegrowers said it is prepared to play its role in highlighting the huge contributions that the sugar industry makes and support government’s localisation drive.

One of the masterplan’s focus areas is re-establishing the local sugar market over the next three years by restoring an initial 150 000 tons of sugar demand to the local sugar industry in the first two years, increasing this to 300 000 tons in year three.

To achieve this, the government, the sugar industry, retailers and wholesalers have committed to a number of actions.

These include retailers and wholesalers ensuring at least 80% of the sugar they procure is locally produced, rising to 95% in year three; the government promoting the use of local sugar to all government departments and state-owned entities; and the sugar industry actively promoting local sugar to consumers and customers.

SA Canegrowers said from its perspective, the immediate first steps to grow local sugar sales must include educating consumers about the impact of sugar exports on the local industry, the benefits of buying local sugar products, and encouraging local consumers to look for labelling that confirms they are buying locally produced sugar before adding these to their trollies.

The organisation said it’s determined to create a thriving, inclusive, transformed and sustainable local sugar industry that supports all our growers, and the one million livelihoods that depend on it.