Sugar revenue up 2.7%
MBABANE – Even though sales volumes have decreased, the Eswatini Sugar Association (ESA) has reported that group revenue has shot up to over E6.1 billion.
ESA is an umbrella organisation bringing together all growers and millers of sugarcane. The increase is 2.7 per cent higher as compared to the previous year. This is reflected in the 2020/21 integrated annual report. The report shows mixed fortunes after an increase in cost of sales from E5.66 billion to E5.92 billion.
Product
The cost of sales is the accumulated total of all costs used to create a product or service, which has been sold. The cost of sales is a key part of the performance metrics of a company, since it measures the ability of an entity to design, source, and manufacture goods at a reasonable cost.
Chief Executive Office (CEO) Dr Phil Mnisi shared that there was a slight increase in cane and sugar production. The mills managed to crush about 5.76 million tonnes of cane, which was 1.2 per cent higher than the previous season. “We saw a healthy demand for sugar throughout the year despite the dreary initial forecast.
“There was a drop in overall sales.
Eswatini Sugar Association CEO, Dr Phil Mnisi.
This reduction was purely driven by less sugar being available for sale as a result of very low opening stocks in
the current season,” said Dr Mnisi.
Looking ahead, Dr Mnisi said they were not oblivious to the headwinds they were facing, which include the changing landscape within the Southern African Customs Union (SACU), which is the main market. The South African Sugarcane Value Chain Master Plan is among the major threats. The plan seeks to reduce Eswatini’s sugar exports to South Africa.
“The traditional markets in the region that we are trying to gain a foothold in are increasing production and threatening our markets share and returns,” said Dr Mnisi.
Sugar is the country’s main export commodity and Eswatini is the fourth largest sugar producer in Africa and the 25th largest producer in the world. Sugar production accounts for over half of the country’s agricultural output and contributes about E4 billion to the country’s gross domestic product (GDP).