The ambitious plan has sought to ensure that 95% of sugar is locally procured and that local demand doubles from 150 000 t to 300 000 t by 2023.

SASA reports that the industry managed to restore 170 000 t of sugar demand in the local market, against a target of 150 000 t in Year 1 of Phase 1 of the Master Plan. Phase 1 of the plan comes to an end in March after three years.

Overall, Phase 1 was aimed at restoring 300 000 t of sugar demand in the local market over the three years, but this target will be missed by 20 000 t, come the end of March.

There are currently discussions on whether Phase 1 needs to be extended or whether industry should proceed with Phase 2.

SASA explains that the sector’s performance in meeting the targeted 300 000 t of sugar demand restoration, only restoring 280 000 t of sugar demand, was influenced by the floods in KwaZulu-Natal in April 2022, the civil unrest experienced in the province in July 2021, the Ukraine war throughout 2022 and its impact on supply chains and input costs, as well as the impact of loadshedding in South Africa.

The local market comprises the Southern African Customs Union (SACU) countries of Botswana, eSwatini, Lesotho, Namibia and South Africa.

The South African sugarcane industry produces about 18-million tonnes a year of sugarcane and two-million tonnes of refined sugar, much of which is exported into the SACU market.

The sugar industry supports about one-million livelihoods, employing 65 000 people directly and 270 000 indirectly. It generates about R18-billion of revenue a year, of which the cane growers’ share accounts for R11-billion.

It contributes about 0.27% to gross domestic product, with export earnings totalling about R3-billion a year.

SASA is aligned with the government’s view that the long-term future of the sugarcane industry relies on restructuring the industry’s foundations and establishing diverse, globally competitive downstream value chains beyond refined sugar and molasses.

This long-term process will take three to five years to bear fruit. Therefore, SASA seeks to develop a long-term policy framework approach to sugar taxation that affords certainty and predictability in support of investment and planning.

To achieve this investment certainty and business predictability, SASA recommends that the Health Promotion Levy, or sugar tax, neither be increased nor expanded to include other products for the next three years.

SASA has implored government to show commitment to the industry and the network of people and communities its supports, including assisting with fast-tracking new sustainable industries that will create jobs and ensure that livelihoods of farmers are sustainable and future-proof.

Courtesy of Engineering News – read full article here.