South Africa’s agricultural sector have launched a number of master plans to help pivot various sub-sectors towards improved agricultural production and revitalised essential agricultural infrastructure. Over the next few weeks Farmer’s Inside Track will be joined by various experts from different commodity organisations to unpack the various master plans.
We kick off this master plan series zooming into the South African Sugar Value Chain Master Plan.
According to Judith Wilson, the South African Sugar Association’s commercial director, the sugar industry is an extremely rural business comprising of 20 631 small-scale farmers and 1 099 large-scale growers. All them and are engaged in a process regulated by the Sugar Act, which means that the price that they are paid for sugar is set by law.
Therefore, a small-scale producer may prosper in this environment if they have the necessary assistance in terms of economies of scale. This is because they do not have to negotiate for the price of their primary product.
“This is particularly important in terms of sugarcane growing in South Africa. It’s a crop where the price is set regardless of a farmer delivering one or 1000 tonnes,” she said.
Master plan is seeing success
Speaking of the master plan, Wilson pointed out that the objective of the plan is to create a diversified, globally competitive, sustainable transformed industry.
“What we were all looking to do is to take an industry that had gone into technically ICU, out of it and stabalise it. Due to various external happenings we were no longer going to be able to sustain the kind of size and number of jobs that we do.
“The estimate is about 65 000 and that’s direct employment. When it comes to indirect employment its 270 000. We estimate that on that basis over 1 million lives in South Africa are dependent on the sugar industry.”
It is for this reason that there was a need to stabalise the industry, Wilson pointed out.
The sugar master plan, which is described as a lifeline for sugarcane growers, was very successful in the first year in terms of increasing local sugar sales, Wilson added.
“The target for the first year was to see an increase of 150 000 tonnes in terms of local sales. We saw nearly a 180 000 tonnes [of sugar sales]. Everyone felt very positive around it.
“What we did find in the second year, which completed in March 2022, is that there had not been much progress past that point. That’s something that’s being discussed within the master plan and stakeholders are engaging to understand what the challenges to that may be.”
In the podcast, Wilson unpacks:
- Working relations between sugar milling companies and the South African Sugar Association;
- Commitment between the master plan and the downstream stakeholders;
- Logistics potential solutions and much more.
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