Media statement by SA Canegrowers
April 29, 2026
SA Canegrowers welcomes Finance Minister Enoch Godongwana’s decision to extend the fuel levy reduction for another month and increase the relief for diesel so that the levy on diesel is zero – as the diesel price is yet again set to see a steep increase. Diesel is a key cost driver in agriculture, and the expected price shock of an estimated additional R7 per litre puts many of South Africa’s 27,000 small-scale cane growers at risk.
The combined cost of on-farm fuel and transport for South Africa’s sugarcane growers amounts to between 17% and 29% of their total costs, depending on how far they are located from their nearest mill. SARS has increased the rebate on diesel for primary sector agricultural users to 100% from April 1, 2026, which allows growers to claim back general fuel levies and the Road Accident Fund (RAF) levy on qualifying farming activities. However, this will not translate into immediate relief at the pump, as diesel prices continue to rise.
“Even before the latest diesel price shock, sugarcane growers were already operating under severe financial strain. A surge in imported sugar and persistently low global prices have significantly eroded our margins, leaving growers with very little room to absorb additional costs. Fuel is one of the biggest input expenses in our sector, and another sharp increase – could push many growers, particularly small-scale farmers, beyond breaking point. Extending the fuel levy reduction is therefore not just short-term relief; it is essential to protecting jobs, sustaining rural economies, and ensuring the continued viability of South Africa’s sugar industry,” said Higgins Mdluli, chairman of SA Canegrowers.
Furthermore, SA Canegrowers urges the government to take a longer-term view on fuel supply and security. South Africa has a clear opportunity to reduce its reliance on imported fuels by creating an enabling environment for bioethanol produced from agricultural feedstocks such as sugarcane. With the right policy certainty and investment framework, the sugar industry can play a meaningful role in supporting energy security, driving rural development, and diversifying farmer incomes in a sustainable and realistic way over time.
“Sugarcane is an ideal feedstock for bioethanol, and by investing in this diversification South Africa can reduce our reliance on imported fuels while safeguarding existing agricultural jobs and creating new opportunities in green industrialisation,” said Mdluli.
The South African government implemented a temporary R3 per litre reduction in the general fuel levy from April 1 to May 5 to mitigate the massive fuel price hikes driven by the conflict in the Middle East. Despite this, April still saw a significant increase in diesel of R7.30 per litre as the levy reduction only partially offset the underlying market surge. The government has extended the R3 relief until June 2 and ensured that diesel pays no levy (R3.93 relief) with a slow phase out of the levy for both fuel and petrol through June.
However, the continued elevated oil price and weak rand/dollar exchange rate mean that the diesel price might again increase by around R7 per litre in May.
ENDS
For media enquiries:
Katharine Child
kath@resolvecommunications.co.za
083 566 7223