Drought likely to hurt SA’s sugar producers

SOUTH AFRICA – Drought in SA’s main sugar-producing region may cost the industry about R920m, South African Cane Growers’ Association executive director David Wayne said yesterday.

SOUTH AFRICA – Drought in SA’s main sugar-producing region may cost the industry about R920m, South African Cane Growers’ Association executive director David Wayne said yesterday.

SA is the continent’s biggest producer of sugar cane, the nation’s largest crop by quantity, according to the United Nations’ Food & Agriculture Organis ation. The government had declared disaster areas in nine of 11 districts in KwaZulu-Natal, where more than 80% of the nation’s sugar was produced, Mr Wayne said.

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“With little prospect of above-normal precipitation before the summer rainfall season ends in six weeks’ time, the agricultural sector is bracing itself for a catastrophe,” Mike Black, president of KwaZulu-Natal Agricultural Union, said yesterday.

There i s a 30% chance of rainfall in Durban forecast for this weekend, down from 60% predicted for yesterday and today, according to the South African Weather Service.

The South African Sugar Association trimmed its forecast for production this season to 2.11-million metric tonnes, from a December prediction of 2.12-million tonnes, it said last month. The cane-output estimate was cut to 17.7-million tonnes from 18.1-million tonnes.

“If we think that things are worrisome now, wait till we start counting the cost of insufficient rain in the planting of crops, grazing for animals, and storage of water,” Mr Black said.

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Illovo Sugar said last month it would not open its Umzimkulu mill for this year’s sugar-milling season because the bad weather had affected expected cane supplies. It would “divert all Umzimkulu cane deliveries to Illovo’s Sezela mill for processing. The additional transport cost of diverting this cane to Sezela will be borne by Illovo”.

“Even if the rain comes now, unfortunately for an optimal sugar crop, I think it would be a bit late,” Durban Chamber of Commerce CEO Andrew Layman said last month. “Sugar farmers are expecting a poor crop because of the drought.”

No sugar shortages or new imports were expected, Mr Wayne said. “The travails of the KwaZulu-Natal sugar industry are unlikely to affect stock levels in the domestic market.”

The Food and Allied and Workers Union, whose members include sugar-mill employees, said producers would need to consult it before closing down mills. If “we work together and speak to government on other alternatives than to close down mills, then it is okay”, Katishi Masemola, general secretary of the union, said last month – Bloomberg

February 8, 2015; http://www.bdlive.co.za/business/agriculture/2015/02/06/drought-likely-to-hurt-sas-sugar-producers

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