Sugar

Sugar is mainly produced in KwaZulu-Natal and Mpumalanga. The sugar-cane lands are mostly situated on the best soils closest to the main roads for easy access to the mills. Soils are deep and well drained, with a clay content of between 20 and 25%.

Production

The 1999/2000 season was not a good one for the South African sugar industry compared to the 1998/99 season. The production of sugar-cane for 1999/2000 was 21,223 million tons, which represents a 7% decline compared to the 1998/99 production of 22,930 million tons. Production of sugar declined by 4%, from 2,646 mil­lion tons during the 1998/99 season to 2,533 million tons during the 1999/2000 season. It is expected that sugar-cane production will increase by 13%, to 24,008 million tons, during 2000/01.

Consumption

The total local consumption of 1,244 million tons of sugar during 1999/2000 represents an increase of 2% com­pared to the 1998/99 consumption of 1,220 million tons.

The production and consumption of sugar from 1994/95 to 1998/99 are as follows:

The producer prices of sugar-cane from 1995/96 to 1999/2000 are as follows:

Marketing

The marketing relationship of the South African sugar industry with Swaziland (in terms of the SACU) allowed a significant quantity of sugar into South Africa at a considerable cost to the local industry. Sales of Swazi­land sugar has increased by 200 000 tons since 1990/91, giving Swaziland a 16,1% market share in 1998/99. The result is that South African producers had to export an additional 200 000 tons of sugar into a volatile world market. This represented a loss of approximately R297 million in proceeds to the local industry.

The factors contributing to the decline in local sales included the generally poor state of the South African economy, increased Swaziland access to the SACU sugar market, continued erosion of the industry’s share of the SACU market by Zimbabwe, and the alleged illegal smuggling of Zimbabwean sugar into SACU. Over the past eight years, the South African industry’s share of the SACU market dropped from 95% in 1991/92 to the current 78% as additional access to Swaziland and Zimbabwe is absorbed.

The most challenging and exciting development in the sugar industry over the past decade has been the sub­stantial growth of the small-scale sugar-cane grower sector. Considerable progress has been made in addressing problems faced by small-scale growers. The area under cane planted by small-scale growers has increased to 97 000 hectares, on which 20% of the total cane crop was produced.

Exports

The proportion of sugar exports to sugar production during 1999/2000 was 49%, which is slightly lower than the 1998/99 proportion of 51%. A total of 1,252 million tons of sugar was allocated to the export market during 1999/2000. This is 7% lower than the 1998/99 figure of 1,353 million tons. The proceeds of sugar exports during 1999/2000 totalled R1,2 billion in foreign currency earnings, almost R528 million lower than in the previous season.