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GAME INDUSTRY TRENDS ANALYSIS 2024
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Sugar Industry Has High Hopes For 2025
Sugar industry has high hopes for 2025
By Sinenhlanhla Mncwango | 3 January 2025 | 5:30 am
The South African sugar industry is bracing for a transformative year in 2025 as stakeholders advance into the next phase of the Sugar Value Chain Master Plan to 2030.
The plan aims to stabilise the sector and drive growth through policy coherence and strategic interventions.
Speaking to Farmer’s Weekly, Sifiso Mhlaba, CEO of the South African Sugar Association, expressed hope for the industry’s future: “We are optimistic that phase two of the master plan will see a thriving industry and usher in policy coherence among government departments.”
According to him, key priorities for phase two included establishing a sustainable pricing framework for the local market, strategic trade protection, and support for small-scale growers.
Additionally, restructuring through diversification and clarity on food policy, including the Health Promotion Levy (HPL) and food warning labels, were considered critical to the plan’s success.
“Sugar cane farmers are a critical component of the master plan. Master plan processes have cemented small-scale growers’ position as being foundational to the industry,” Mhlaba said.
He added that phase two would intensify efforts to prevent growers from leaving the sector, especially amid persistent challenges like high input costs and market volatility.
Mhlaba said the HPL, commonly known as sugar tax, continued to weigh heavily on the industry, eroding revenues and dampening growth prospects.
The tax has already cost the sugar industry an estimated R1,2 billion annually, significantly reducing local market demand.
“The devastating sugar tax continues to put the sustainability of the sugar industry at risk,” he added. However, he credited the master plan’s interventions for partially recovering local sugar sales, aligning with its goal to optimise the domestic market.
According to Mhlaba, to ensure long-term viability, the industry was pursuing diversification through sugar cane by-products, such as bagasse.
Its potential uses include bio-energy, sustainable aviation fuel, and sugar cane-based polymers, which could new revenue streams for growers and millers alike.
“For years, the industry has been intentional about the need to diversify. These initiatives are still in the scoping and prefeasibility stages and require an enabling regulatory framework, similar to successful strategies in India and Brazil,” he said.
Looking to 2025, industry stakeholders remain committed to addressing challenges while fostering a resilient and diversified sugar industry.
“With phase two, we envision an industry that supports its growers, embraces innovation, and overcomes regulatory hurdles,” Mhlaba said.
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