No sugar-coating the hardship on KZN’S cane farms
WHEN Siyabonga Madlala became a sugarcane farmer almost a decade ago, his aim was to uplift his community.
At its peak, his farm employed between 200 and 500 seasonal workers, but Madlala can now barely afford to pay 50 workers the minimum wage because the sugar industry is beset by challenges.
Madlala, 38, was born and raised on a farm in Kwadukuza and is all too familiar with hardship. His community was steeped in poverty and sugarcane farming was a means to uplift them.
His grandmother, Victoria Khuzwayo, was among the pioneers of the Mansomini Irrigation Co-operative – a project that led to the sugarcane business on Kwazulunatal’s North Coast booming in the 1980s and early 1990s.
But its success was short-lived. The Glendale Mill closed and the community again found itself battling to survive.
By then Madlala, who went to study actuarial science at UCT, returned home to assist his ageing granny with a project that would revive economic activity in Glendale.
In 2009, Madlala stepped in with his business acumen. He and Khuzwayo revived the project.
The lives of rural sugarcane growers were changed. They farmed on communal land as a collective. They were able to send their children to school, build proper houses and put food on the table.
“Farming is my calling. I tried to run away from it, but I couldn’t.
“My granny, who started the Mansomini Irrigation Co-operative, wanted me to take over her vision when she died and that is what I did,” he said.
The small-scale farmer, who also chairs the SA Farmers’ Development Association, which represents about 17 000 emerging farmers, faces the same predicament he encountered years ago.
He has had to shed jobs and has been struggling to make a living from farming sugarcane due to new challenges in the industry.
The Health Promotion Levy, also known as the sugar tax, cheap imports of sugar, and the low demand for sugar have resulted in a crisis.
“We are seeing prices we saw five years ago. The demand for sugar has dropped. It has reduced the market by 20000 tons, which is equal to R1billion in revenue.
“As a co-operative, when we were at our peak we would employ between 200 and 500 seasonal workers. The number is now down to 50 workers. We can’t even afford to pay the minimum wage of R20 an hour.
“We were hit badly by sugar imports, but now it’s worse with the sugar tax,” said Madlala.
Finance Minister Tito Mboweni raised the sugar tax from 2.1 cents to 2.21c per gram of sugar per 100ml, with the first 4g of sugar exempt from taxation.
Madlala said the increase was expected to have a catastrophic effect on farmers.
“We facing a slide because of the drop in prices. We had a severe drought from which we have recovered, but the sad part is the price is not helping us.
“We are unable to function optimally because we cannot afford irrigation systems, which require investment, because we are not making profits.
“The banks don’t even want to look at us because we are making losses.
“The portfolio committee of the Department of Trade and Industry (dti) and the president helped when they reviewed the import tariffs.
“But the rewards we should have reaped from the tariff review have been lost because of the drop in local sugar sales which resulted from the sugar tax,” said Madlala.
He said for the industry to survive the government must urgently implement the mitigation measures it promised when it announced its plans on the sugar tax.
“They said small-scale growers and land reform would be assisted through support from the government. We were supposed to get chemicals and fertiliser, but that hasn’t been implemented.
“We are in talks with the Department of Rural Development and there is hope.
“There was also talk of diversifying the sugar industry, turning the surplus sugar we produced into bio-ethanol.
“We need legislative intervention from the government so we can take advantage of that opportunity.
“The situation is dire because the mitigation measures have not kicked in,” said Madlala
He urged the government to act urgently or “the gains made in rural development will be reversed”.
The portfolio committee on trade and industry met stakeholders last week.
Committee chairperson Joanmariae Fubbs said dti Minister Rob Davies needed to discuss the impact of the sugar tax on the industry with the ministers of health and finance.
She said he also needed to ensure the implementation of the mitigating measures and move towards diversifying output, in particular with respect to ethanol.