Sugar Industry


FairPlay movement has welcomed the South African government’s decision to revive its biofuels strategy, as announced in a speech by Energy Minister Jeff Radebe at an energy conference in Cape Town last week, reports Sugaronline.

“This confirms FairPlay’s position that implementing a mandatory bioethanol fuel blend will benefit the country through job creation, increased fixed investment, technology development and energy security, as well as expanded sugar production and desperately needed jobs in poor rural areas,” said Francois Baird, founder of the movement that fights for a level playing field in trade, and for the protection of local jobs.

“It’s been a long time coming, and South Africa has to hope that this time it’s for real,” Baird said. “More than a decade ago, the government committed to a biofuels strategy, aiming at a mandatory blend of at least 2% ethanol in petrol. In 2015, it provided for a mix of between 2% and 10%. Nothing happened, and the strategy was never implemented.” He noted that while countries around the world are developing and implementing fuel ethanol policies, spurred by sharply rising oil prices, South Africa has been left behind.

In the speech delivered on his behalf at the conference Minister Radebe said that the South African government plans to finalise the biofuel blending regulatory framework and have it approved by cabinet by the end of March next year.

Said Baird, “It’s welcome news for the country, the economy and in particular the sugar industry which has been contracting in the face of surging sugar imports when it should have been growing and creating jobs. That expansion is now in prospect, dependent on the details of the plan to be released next year.”

Minister Radebe plans an initial 2% blend, which will be enough to stimulate a distressed sugar industry. As the South African fuel ethanol industry grows, it should be possible to increase the mandated blend to 10% or even higher as countries such as Brazil have done successfully.

“It will result in a new ethanol industry, increased land under sugar cultivation, and more jobs in rural areas,” he said, noting that these issues were is in keeping with South African President Cyril Ramaphosa’s recently announced economic stimulus package. One government estimate some years ago put the potential job creation from an ethanol policy at a figure of 125 000, Baird said, adding that the

South African sugar industry is more conservative, estimating some 25 000 new jobs could be created. “Either way, it will be a huge bonus in a country with one of the highest unemployment rates in the world. The spin-offs from this growth and investment will boost the national economy.”

Increasing use of fuel ethanol is also likely also save the country millions in oil imports, particularly if the oil price keeps rising, Baird argued. The Minister is looking at an initial consumption of 400 000 liters. Even with a small levy to stimulate the ethanol industry, it should help government to cushion consumers by slowing the rise in fuel prices, Baird said.

“It is worth noting that, unlike maize, the use of sugar to make fuel ethanol does not impact on national food security.” FairPlay has been advocating this development for some time. The huge potential, both nationally and regionally in South Africa, of a fuel ethanol policy will be discussed at a conference to be hosted by FairPlay planned for November this year. The Ethanol Action Summit will be a platform for private sector and public sector stakeholders to explore ways to drive growth and economic benefits from a fuel ethanol strategy.

Baird confirmed that Minister Radebe and South Africa’s Department of Energy will be invited to the summit to speak about the roadmap for implementation of his ethanol strategy. “We hope that he and his biofuels team will do us the honour of attending,” he said.