T
he large amount of sugar being
imported into South Africa has
caused the country’s sugar industry,
which may soon be further compromised
by the introduction of a sugar tax, to start
exporting sugar at world market prices to
offload excess sugar, which it is unable to
sell locally.
While opposing the introduction of a
20% tax on sugary beverages, or what
has been referred to as sugar tax, South
African Sugar Association (SASA)
commercial director Judith Wilson
says the sugar industry is also tackling a
high volume of imports from the residual
world market at prices below
any producer’s cost of production.International markets were paying
R14.74/lb of sugar at the start of November,
however, she highlights that this does not
cover the cost of local sugar production.
Compounding the unattractive global
sugar price are the free-trade agreements
South Africa has with Southern African
Development Community (SADC)
countries. This agreement enables these
countries to export a quota volume of
sugar and other commodities into South
Africa without having to pay import duties.
“SADC countries can send about
43 000 t of sugar to South Africa duty free.
But, we don’t have the reciprocal export
opportunities; it’s only one way, coming
into South Africa. Further, this year,deep-sea imports have increased from
5% of the total sugar consumed in the
Southern African Customs Union to an
estimated 29%,” Wilson states.
Deep-sea imports to South Africa are
mostly from the United Arab Emirates
(UAE) and Brazil – the import of sugar
from these countries further increases the
challenges for local industries.
“Deep-sea imports are displacing
South African sales, which is why we
are now exporting massive volumes of
sugar. We’ll have exported 500 000 t of
sugar by the end of this season as a
result, negatively impacting on our
economy,” Wilson points out.32 ENGINEERING NEWS | December 8–14, 2017 AN
SUGAR GROWERS,
MILLERS & REFINERS
Compiled by VICTOR MOOLMAN- To page 34
Battling threat of sugar tax,
excessive imports and low price
DEDICATED TO SUGAR CANE
Large parts of KwaZulu-Natal and Mpumalanga, about
Picture by Victor Moolman 360 000 ha, are dedicated to growing sugar caneVICTOR MOOLMAN | CREAMER MEDIA REPORTER