eBusiness Weekly
Enacy Mapakame
HARARE – Sugar industry sales on the domestic market increased 11 percent to 334 000 tons in the year to 31 March 2018 from 301 000 tons in the prior year, thanks to regulations limiting imports.
The local sugar industry is benefitting from the Statutory Instrument 64 of 2016 (SI64) which limits importation of goods that can be locally manufactured as a way to enhance local industry and domestic consumption.
Total industry exports to the United States of America and regional markets decreased 62 percent to 58 000 tons on reduced sugar production and increased local sales.
The favourable sales mix achieved in the domestic market resulted in average mill door price for the season of $626 per ton, representing an overall increase of 8, 3 percent.
According to sugar manufacturer Hippo Valley Estates, during the year to March 31, 2018, there was an increase in total industry volume of local market sugar sales arising from favourable sales mix on the back of low imports.
“The timely intervention by Government to protect industry against competition from dumped world market imports continued to yield positive results in addition to providing job security in the industry,” said Hippo in a statement accompanying its financial results.
Given the normal growing conditions and crop improvements, sugar production is projected to be between 433 000 and 483 000 tons in the 2018/19 season, further growing to 500 000 and 560 000 tons in the 2019/20 season.
Successful completion of the Tugwi-Mukosi Dam has improved irrigation for cane, resulting in better crop quality.
For Hippo, indications are that standing cane valuations at year end already reflect the improvement in the cane crop to be harvested which benefitted from optimum irrigation.
“The industry as a whole continues to expand its cane production and supply to the sugar mills, contributing significantly to the socio-economic well-being of the communities its operations,” said sugar manufacturer Hippo.
Local sugar industry has a total milling capacity of 640 000 tons per annum.
The sector also anticipates to benefit from opportunities arising from evolving access into regional deficit markets which are expected to grow in per capita sugar consumption in the short to medium term as well as continued growth in the local market.
