Government considers import controls to stabilise sugar industry

Government is considering stricter import controls and quotas on deep-sea sugar imports to help stabilise the domestic sugar industry, says Trade, Industry and Competition (dtic) Deputy Minister Zuko Godlimpi.

Speaking to small-scale sugarcane growers in Mzinti, Mpumalanga, on Saturday, Godlimpi said government is also pursuing legislative amendments to support diversification into the bioethanol value chain. This includes adjusting fuel blend requirements in coordination with the Department of Minerals and Petroleum.

“A primary concern remains guaranteeing sufficient feedstock (sugarcane) to meet potential bioethanol quotas without compromising existing supply. An agreement with the Department of Minerals and Petroleum regarding blend requirements could create significant business opportunities for producers,” the Deputy Minister said.

However, Godlimpi warned that legislative changes could push demand for sugar in fuel blends beyond what local production can supply.

“While milling capacity in areas like Umfolozi and Zululand appears sufficient, guaranteeing consistent sugarcane feedstock remains a priority. It must also be noted that expanding smallholder farmers into medium-sized producers is essential to meeting future demand through models like RCL’s community holding approach,” he said.

On pricing, Godlimpi noted that existing boundary rates on dollar-based reference prices limit the scope for further increases.

“To improve competitiveness without relying on price increases, the sector must optimise energy costs and water resourcefulness,” he said. – SAnews.gov.za

Source: Original report at SAnews.gov.za.