The Department of Trade and Industry (DTI) has established a sugar value-chain task team, comprising representatives from the beverage industry, retailers, the South African Sugar Association (Sasa), smallholder farmers, small manufacturers and the Industrial Development Corporation of South Africa.
The task team was established at a DTI stakeholder meeting, held in Pretoria, on Monday, after imminent challenges facing the industry were discussed. The meeting was chaired by Trade and Industry Minister Dr Rob Davies and Economic Development Minister Ebrahim Patel.
The task team aims to seek rapid solutions to the challenges facing the industry, focusing on short-, medium- and long-term plans.
The first meeting of the task team will be held on Wednesday and it is expected that joint recommendations from the task team will be submitted to the Ministers concerned.
“Through collaboration between government and the private sector, better solutions in terms of inclusive growth, transformation, competitiveness and sustainability of the industry can be attained,” the DTI said.
According to a report from Sasa chairperson Suresh Naidoo the biggest threat to the industry has been the sustained increase of sugar imports, peaking at just around 500 000 t in the 2017/18 season. The effect is that these imports displace locally produced sugar into the depressed global sugar market.
The South African Farmers Development Association stated that the prices for sugar cane have declined to such an extent that some growers have received negative statements at the end of the season and, in fact, owe to the millers.
The association is of the view that local producers cannot compete against subsidised foreign countries and the sugar producing countries around the world offer their sugar industry a range of policy support measures to protect them against a distorted world market.
The beverage industry made proposals regarding proposed interventions in support of smallholder farmers in the industry and also how to improve productivity in the sugar value chain.
Sugar is a strategic industry in South Africa, contributing an estimated R14-billion to gross domestic product, while employing 85 000 people directly, and provides work for 350 000 people downstream.