To safeguard the future of sugarcane growers and the sugar sector as a whole, industry body SA Canegrowers believes it is critical that both government and all industry stakeholders commit to ensuring that the good work achieved under the Sugarcane Value Chain Masterplan continues, chairperson Andrew Russell states.
He points out that the entry of two millers into business rescue in recent months has caused ripple effects throughout the industry.
"Critically, the business rescue practitioners at these companies have announced defaults on financial obligations amounting to R1.5-billion to the industry that have left growers and industry partners in a highly precarious financial position and facing an uncertain future," he says.
Government and industry stakeholders are expected to participate in an executive oversight committee on May 10 to discuss the conclusion of Phase 1 of the Sugarcane Value Chain Masterplan and to find common ground on the way forward.
The committee, which is chaired by Trade, Industry and Competition Minister Ebrahim Patel, was established to oversee the implementation of the masterplan.
Russell says the industry and government have to commit to continue protecting the industry against cheap sugar imports and restoring demand for local sugar. For its part, SA Canegrowers plans to continue its Home Sweet Home campaign, which educates and encourages consumers to buy locally produced sugar.
The transformation of the industry also remains another key priority, with more than R187-million disbursed to date under the auspices of the masterplan to support small-scale growers.
Good progress also continues to be made on critical projects, such as the development of a sustainable aviation fuels industry, which will position the industry for sustainable, long-term growth and job creation.
"Given the industry’s investment in the execution of this project, we cannot let these gains be lost. And with developing countries like India and Brazil fast-tracking investment in the growth of this nascent industry, South Africa cannot afford to fall behind. SA Canegrowers, therefore, hopes that key commitments to ensure this project continues will be made at today’s meeting, including the rapid development of a suitable regulatory framework by government, to keep this project moving forward," he states.
In addition to the need to maintain the gains made on the masterplan’s proactive projects, the industry also cannot afford any reversals in the effort to address the risks to the industry.
"These include any future increases in the Health Promotion Levy (or sugar tax), which remains an ongoing threat to the survival of growers and the livelihoods they support. Engagement on the socioeconomic impact of the sugar tax must, therefore, continue between government and industry stakeholders moving forward," Russell says.
Finally, while the masterplan was developed prior to the current milling crisis, ensuring the continued operation of the mills is of critical importance to the short-, medium- and long-term sustainability of the industry.
"SA Canegrowers will therefore also use today’s engagement with Minister Patel and industry partners to discuss concrete interventions, including possible grant funding for growers, to ensure the survival of the country’s growers and the livelihoods they support," he notes.