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Sugar Industry Pinning Hope On New Ministers

Sugar Industry Pinning Hope On New Ministers

BY: Farmers Weekly 26 Jun 2019 Filed in: Canegrowers News

The newly elected board members of the South African Cane Growers' Association (SA Canegrowers) have expressed hope that they will be able to work with recently appointed Minister of Agriculture, Land Reform and Rural Development Thoko Didiza, and Minister of Trade and Industry Ebrahim Patel, to implement solutions to turn the sugar industry's fortunes around.

Speaking at SA Canegrowers' 92nd annual general meeting, recently held in Mount Ecdgecombe, KwaZulu-Natal, newly elected chairperson RexTalmage said the sugar industry was"on its knees". Talmage attributed this to factors such as the introduction of the health promotion levy (HPL), which had resulted in about 250000t of local sugar having to be traded at record low prices on the oversupplied world market, and the dollar-based reference price tariff on imported sugar being ineffectual in stemming imports. He said the situation had been exacerbated by three factors:

1. an increase in sugar imports from neighbouring eSwatini, which was exempt from sugar import tariffs 

2. minimum wage for farmworkers

3. high levies imposed on fuel.

"The final recoverable value price [paid to canegrowers] at the close of the 2018/2019 [milling] season was R3 57441/t, down from R4 187,11/t in the 2017/2018 season, resulting in the growers' net share of the industry's proceeds plummeting from R9,14 billion in the 2017/2018 season to R8,6 billion in the2018/2019 season. While commercial growers have been hard hit, the worst-affected are the over 20000 small-scale growers who rely on the crop for their livelihoods," Talmage said.

SA Canegrowers said in a statement that the board was looking forward to working with Patel to develop a rescue plan, which would include opportunities for diversifying products and extracting value from sugar cane stalks for the industry. The board also expressed hope that Didiza and her department would provide the necessary support to allow SA Canegrowers to continue its transformation activities in the sector.