SOUTH AFRICA – The sugar industry is confident it can produce enough sugar to supply the local market in 2015-16 despite the severe drought in several sugar-growing regions, Trade and Industry Minister Rob Davies said on Tuesday.

He said there was sufficient raw sugar in stock at the sugar terminals in addition to a small surplus for export, though special measures had had to be taken to ensure more production of refined sugar.

“Due to the unexpectedly high demand for refined sugar, especially by the soft drinks manufacturers — due to the hot summer period — the industry experienced low stocks of some grades of refined sugar.

At the beginning of March the sugar industry met to implement a strategy to restore supply of refined sugar into the domestic market,” the minister said in a written reply to a parliamentary question by Democratic Alliance (DA) trade and industry spokesman Geordin Hill-Lewis.

Mr Hill-Lewis wanted to know whether the minister was considering the temporary removal of duties on imported sugar to assist consumers and alleviate food price inflation in the context of a significant shortage of locally produced sugar.

Mr Davies said the two biggest refineries, Noodsberg and Hullets, had agreed to open early for refining purposes as the industry is currently off season, in addition to working over the public holiday period in March.

The rest of the refineries will open in April as the new sugar season starts on April 1.

“The figures received from the sugar industry regarding 2016-17 production estimates, current available supply and carryover stock into the new season from the 2015-16 crop, indicate sufficient supply into the local market going forward.

“Noting that the supply to the local market consists of South African production, Southern African Customs Union production (Swaziland), Southern African Development Community quota and duty paid imports, as well as imports from the rest of the world, we are confident that supply will be sufficient to meet local demand.

“In the event of a supply shortage, the department will engage with the industry and International Trade Administration Commission (ITAC) to initiate a rebate facility to counter the effects of the duty on imports, subject to statutory requirement of the process.”

Replying to a question from DA MP Dean Macpherson on the extension of the manufacturing competitiveness enhancement programme beyond its 2017-18 expiry, Mr Davies said negotiations with Treasury about securing additional funds for this were continuing.

March 29, 2016;