Sugar Industry

Sugar industry protests against low import tariff

Small-scale sugar cane growers stand to lose the most if an increase in the sugar import tariff was not implemented soon.

This emerged during recent protests by the South African Farmers’ Development Association (SAFDA) at the offices of the Department of Trade and Industry and the International Trade Administration Commission (ITAC).

Speaking to Farmer’s Weekly, following the protests in support of the sugar industry’s application for an increase in the dollar-based reference price of sugar, SAFDA spokesperson Ronda Naidu said that black small-scale sugar cane farmers were struggling to survive. “Our concern is the high level of imports. Last month, half a million tons of sugar were imported.

The current price is below cost of production,” she said. In May, industry organisations applied for an increasein the dollar-based reference price (DBRP)of sugar, from US$566/t (about R7 600/t) to US$856,32/t(R11500/).

According to the ITAC website, the sugar industry was protected by a DBRP tariff system based on the long-term average global price of sugar. The tariff system only cameinto effect when the global price dropped below this reference price.

South Africa has approximately 20 000 sugar cane growers, of whom 90%are small-scale farmers and 10%commercial farmers. Small-scale farmers contributed about 10%to total sugar production, with some growing cane on as little as half a hectare.

The low price not only affected growers, but also their communities, Naidu said.

SAFDA believed that large producers in Brazil and India dumped sugar onto the local market, she added.

The industry was also opposed to the Health Promotion Levy, which is a tax on sugar-sweetened beverages.

– Gerhard Uys