Sugar price rises marginally

THE price of sugar has increased by between 30 to 40 cents, with Zimbabwe’s sole sugar producer Tongaat Hulett Zimbabwe citing a spike in production costs as the reason for the increase.

Since last Friday, retail prices of sugar have shot up from about $1,80 for a 2kg packet of Huletts brown sugar to between $2,20 and $2,30 per packet.

Tongaat corporate affairs and communications manager Ms Adelaide Chikunguru on Tuesday confirmed the increase, which she said was necessary for the industry’s survival in the wake of the prevailing operating environment.

She said the increase was imperative for the sugar industry to cushion itself in the wake of a jump in production costs.

“The sugar industry has in recent times been faced with increasing cost of production, which are no longer sustainable in the current operating environment,” said.

“To this end, since April 2018, substantial cost increases have arisen in respect of sugar production costs and sugar milling costs. The recommended price adjustment has been communicated to traders (wholesalers and retailers).”

Ms Chikunguru said the sugar industry was grateful to Government for its strong stance against sugar imports, which she said was necessary for the survival of the local industry, particularly in terms of job security.

The Lowveld sugar industry employs more than 21 000 workers directly and its survival hinges on Government protection to stop the influx of cheap low quality sugar into the local market.

“There has been a marked increase in the sugar sales arising from a favourable sales mix on the back of low imports and an increased off-take by industrial customers.

“The timely intervention by Government to protect the industry against competition from dumped world market imports continued to yield positive results in addition to providing job security in the industry,” she said.

Indigenous sugarcane farmers in the Lowveld have since welcomed the marginal rise in the price of sugar, which they expect would result in more cash remaining in their pockets to help them service the loans they accessed to buy farming equipment and inputs such as fertilisers.

Government has been clamping down on imports of cheap sugar into the country that at one time threatened to destroy the local sugar industry, which is the backbone of the Lowveld’s economy.