SA experiences sugar shortage as mills are unable to meet demand

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The chairperson of the Association of Southern Africa Sugar Importers (Asasi), Chris Engelbrecht, warned yesterday that South Africa is facing a shortage of sugar, the new “white gold”, with local mills unable to meet the local demand.

Engelbrecht said sugar was like white gold. “White sugar is now selling at R16 500 per ton (excluding VAT). The usual price is R11 500 per ton (excluding VAT).”

He said the current sugar import duty was R4 148 per ton, which was adjusted on March 5, 2021 (the trigger date was November 30, 2020). Since then, there had been three duty triggers to reduce the import duty on sugar, which, however, had not been implemented.

Engelbrecht explained that the world sugar price was now R8 280 with a ridiculous shipping cost of R2 884 per ton (a 500 percent increase), which left the current landed price for import sugar at a cost of R15 712 per ton, on current duty, instead of R13 510 per ton (on duty trigger 3).

He said that even at the lower import duty, the sugar price was still higher than the local market.

Engelbrecht said the minister’s office had been notified three times in the past 10 months that there would be a shortage in the local sugar market.

“Firstly, in July 2021 when news that 300 000 tons of sugar cane was burnt in the protest actions. Secondly, in December 2021 when news received in September was that 1 million hectares of cane would not be crushed this season. Thirdly, in April 2022 when there was literally no sugar.”

South African Farmers Development Association (Safda) executive chairperson Dr Siyabonga Madlala confirmed that there was a shortage of sugar supply on the local market.

“The industry management has been working closely with the milling companies to assess the situation and to devise strategies of ensuring that local market customers’ needs are met,” Madlala said.