Thousands of jobs at risk in sugar industry

Thousands of jobs are at risk in South Africa’s sugar industry after a major sugar producer, Tongaat Hulett, went into business rescue. This is a formal process designed to protect a troubled company from its creditors during an attempted rescue process.

The SA Canegrowers Association has urged government intervention, because 14 000 jobs could be lost if Tongaat collapses. It repeated the call this week, despite Tongaat agreeing to belated payments to thousands of growers.

In protest at the non-payment, growers had stopped delivering sugar cane to Tongaat. Deliveries will now resume, ensuring processing of this year’s crop and cash flow for Tongaat’s three sugar mills.

Tongaat’s business rescue practitioners have asked creditors to approve a delay to January next year of the publication of their business rescue plan for the sugar giant.

Canegrowers said government intervention remained urgent, because there was no guarantee that Tongaat would emerge from business rescue. Its demise would plunge the sugar industry into crisis and undo years of work in terms of the sugar industry master plan, reversing efforts to protect the industry from cheap sugar imports, they said.

It looks like the Tongaat saga will be with us next year and beyond.