R/€ = 13.13
R/$ = 12.04
Au 1188.10 $/oz
Pt 1119.50 $/oz
May 31, 2002
Sugar group consolidates African assetsBack
© Reuse this South Africa's largest sugar producer the Illovo Sugar group, has completed its rehabilitation of the Maragra sugar mill and agricultural estates in Mozambique, a programme which began when the company acquired a 50% stake in 1997.
The programme also includes the restoration of the damage to the agricultural estate in Mozambique following the floods of February 2000. In addition to the complete rehabilitation of the agricultural estates and the sugar factory, supporting infrastructure has also been redeveloped, including roads, administrative buildings, housing villages, and other social infrastructure.
This has been to the benefit of not only the sugar-producing operation, but also to the surrounding communities which have undergone significant upliftment since the rehabilitation programme began.
The group operates in South Africa and countries including Swaziland, Malawi, Zambia, Mozambique, Tanzania and the US. It produces about two-million tons at 15 sugar factories and has extensive cane estates, which produce more than five-million tons of sugar-cane a year. In general, the group has spent the past 18-months consolidating its operations, ensuring that it is achieving the best return from its existing assets. In Tanzania, the group's operation at Kilomboro has just competed its rehabilitation programme with the production of 73 000 t of sugar, a substantial increase from the less than 30 000 t that were produced before Illovo became involved in the operation in 1998.
Production this year is expected to increase to almost 100 000 t. Swaziland's production for the 2001/2 season was about 180 000 t, while Malawi produced 215 000 t, Zambia 200 000 t, Mozambique 15 000 t, and South Africa recorded a 1 111 000 t production.
In the US, the group is producing sugar from beet at the Monitor Sugar Company, which produced 162 000 t of sugar last season. The factory operates a successful molasses desugarisation plant, which exhausts any remaining sugar content from the molasses, a by-product of the sugar-manufacturing process, thereby enhancing the yearly output of sugar. The operation does not grow its own beets, but signs up local growers every year to provide the mill with its requirements. Monitor produces refined sugar mainly for the local markets in Michigan, with 75% of output directed towards the industrial market and the remainder sold to consumer markets.
The group supplies sugar and downstream products to a considerable range of domestic, regional and export markets in more than 90 countries across the globe. The Southern African Customs Union (SACU) market is important for both the group's South African and Swaziland operations. In the 2001/2 season, South African industry sales into SACU amounted to about 1,6-million tons, of which 81% was refined and 19% was brown.
Of this total, South Africa supplied 1,3-million tons including sugar produced by Illovo, Swaziland 300 000 t and Zimbabwe, and others 74 000 t.
The immediate outcome of the recently concluded Southern African Development Community (SADC) sugar co-operation agreement will be to allow market access into SACU by each SADC net surplus producer on a non-reciprocal basis. This will be based on actual SACU market growth which, in the first year, is expected to be 45 000 t of sugar. In addition, duty-free access into the SACU sugar market for 20 000 t of sugar a year will be available to the non-SACU SADC surplus sugar-producing member states. The total access available to non-SACU members is estimated to be approximately 29 000 t in the 2001/2 season. In the US, Monitor Sugar supplied its entire production to the domestic market. In Malawi and Zambia, Illovo is the primary supplier of sugar to the domestic market with significant sales of sugar to local markets in Swaziland, Tanzania and Mozambique.
In relation to sugar exports, the group has access to preferential markets in Europe and the US, which are supplied by producers with export quotas to these countries at a marked premium to the world free-market price. Downstream production includes furfuryl, furfuryl alcohol, diacetyl, acetoin and 2.3-Pentanedione produced at the Sezela complex, and ethyl alcohol at Merebank and Glendale. Lactulose is also produced at the Merebank plant. While the group's range of downstream products is primarily aimed at export markets, the Merebank and Glendale distilleries remained material suppliers of ethyl alcohol to the South African liquor, pharmaceutical and industrial chemical industries. Relatively small volumes of furfural and its derivatives were also sold domestically. The by-products of the Monitor Sugar factory, which include beet pulp, betaine and concentrated molasses solids, were sold domestically and, in the case of beet pulp, into Canada.
It is focused on its core activities of cane growing, sugar manufacturing and the production of downstream products, and any new service, projects, or technologies are aimed at the group being a global, world-class, low-cost sugar and downstream products company.
Edited by: nkolola halwindi© Reuse this Comment Guidelines (150 word limit)
Other Agricultural Engineering News
Technology supplier SKF South Africa displayed its agricultural solutions for the first time at its own stand at this year’s Nampo agricultural trade show, which was held in Bothaville, in the Free State, from May 13 to 16. SKF agriculture key accounts manager Charl...
Global construction equipment and compact machinery manufacturer Wacker Neuson plans to further expand its stand at next year’s Nampo agricultural trade show, which will be located in the middle of the new expanded area, close to the southern gate. Wacker Neuson was...
Sustainable agriculture company Syngenta’s Africa Middle East Seedcare Institute, in Brits, focuses on new application technology, ensuring that seed treatments provide an effective way of placing crop protection products directly onto the seeds, Syngenta seed care...
Recent Research Reports
Steel 2015: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2015 report provides an overview of the key developments in the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon...
Projects in Progress 2015 - First Edition (PDF Report)
In fact, this edition of Creamer Media’s Projects in Progress 2015 supplement tracks developments taking place under the Renewable Energy Independent Power Producer Procurement Programme, which has had four bidding rounds. It appears to remain a shining light on the...
Electricity 2015: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2015 report provides an overview of State-owned power utility Eskom and independent power producers, as well as electricity planning, transmission, distribution and the theft thereof, besides other issues.
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
This Week's Magazine
While economic forecasts for the African continent are most favourable, African airlines may not be able to benefit from the expected growth in the region’s gross domestic product (GDP), International Air Transport Association VP: Africa Raphael Kuuchi has warned....
The Automotive Production and Development Programme (APDP) will need to change substantially post 2020, says Metair Investments South African operations COO Ken Lello. “We must not make tweaks. We have to change. What we are doing is not sustainable.”
Banking group Absa’s forecast is for the rand to end the year at around R13 against the dollar, weakening further to R13.50 by 2016, says Absa sectoral analyst Jacques du Toit. He warns that possible interest rate hikes in the US may see capital being pulled from...
The Dispute Resolution Centre at the Bargaining Council for the Civil Engineering Industry (BCCEI) is now open to handle party-to-party disputes. The BCCEI represents the interests of all level four to nine Construction Industry Development Board companies.
Communications technology firm Ericsson sub-Saharan Africa head Fredrik Jejdling says the company’s commitment to sustainability and corporate responsibility has been integrated into all facets of its operations, which has provided it with sustainable revenue...