Sugar industry warns cheap imports threaten jobs as government delays price fix

South Africa’s sugar industry is calling for urgent state action as low-priced imports flood the local market and threaten livelihoods and jobs, industry leaders said.

Industry alarm over cheap imports

SA Canegrowers and other local industry representatives have expressed concern that the market is being increasingly saturated by low-cost sugar imports from Brazil, India and Thailand, supplemented by regional supply from Eswatini. The industry says those exporters use government subsidies and ethanol integration schemes to place surplus sugar on international markets at prices that undercut local producers.

Two-year wait for a price review

Industry sources pointed out that it has been two years since local players asked the International Trade Administration Commission (Itac) to review the dollar-based reference price that acts as a floor price in dollars per ton. That reference price was last adjusted in 2018 and, the industry says, no longer reflects local production costs.

Role of Itac and pending ministerial decision

The trade commission, which was established to create an enabling environment for fair trade and to provide technical advice to the department of trade, industry and competition, has completed a review and its final proposal is now with Minister Parks Tau for his signature.

“But SA Canegrowers does not know if it will be an adjustment that supports the sugar industry, or when Tau will sign it into law. It might come as early as the end of this week,” said SA Canegrowers CEO Thomas Funke.

Local measures under consideration

At issue is whether the dollar-based reference price should be adjusted so that tariffs would apply when world sugar prices fall below that floor. Separately, draft regulations published by Minister Tau last year would permit consultations on the procurement of over 90% local sugar by growers, millers, retailers and food and beverage manufacturers without breaching the Competition Act.

Next steps

With Itac’s proposal awaiting ministerial sign-off, the industry is watching for a decision that could change how imports are treated and whether tariff protections will be adjusted to reflect current production costs.