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SADC SUGAR MARKETS ‘FLOODED’

12/04/2019 08:41:00 BY NOKUPHILA MABUZA

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MBABANE – “The SADC market continues to be dominated by surplus sugar producers who traditionally supplied the EU market and the EU diverted their exports to the region.”

This submission was made by Eswatini Sugar Association (ESA) Chief Executive Officer (CEO), Dr. Phil Mnisi during the 9th Africa Sugar 2019 conference, which brought together African and international sugar market leaders, in Nairobi Kenya. Mnisi spoke at the conference on behalf of the Eswatini sugar industry and the ESA.

Conference

The conference concurrently ran with the AgTech Africa 2019 conference and the Sustainable Agriculture Summit which had over 300 participants, more than 60 speakers and 60 market case studies all in one joint networking and exhibition area.

On COMESA, Mnisi said Eswatini had access to the market by derogation and the country was able to supply Kenya under the Kenya sugar safeguard, which put limits on the imports of sugar.

The ESA CEO said the EU market was still a market for raw sugar for refiners though the industry had experienced a drop in prices due to the increased domestic production. The strategy the Eswatini sugar industry employed was to reduce sales in this market and use other alternative markets.
He said the Eswatini sugar industry’s marketing strategy included offering low world market prices, change in the traditional export markets, exploring market opportunities within the region and dealing with the non-tariff barriers and other trade facilitation issues.

He said, “There were some new market opportunities to explore. These included the Common Market for Eastern and Southern Africa; Eastern Africa Community and the Southern African Development Community (COMESA-EAC-SADC) Tripartite, which had 26 member countries and a population of 625 million. “The African Free Trade Area was another market opportunity, which thrives to create one large and integrated market for Africa. It had 54 member states and a population of 1.3 billion people.

Lastly, the United Kingdom (UK) as a stand-alone market outside of the EU.” Mnisi mentioned the value addition component for consumption purposes of the industry which included packaging for table top use, sweets, confectionery, beverages.

The non-consumptive value added component produced products such as ethanol made from molasses, cogeneration of electricity, blended fuels and fertiliser from vinasse. He explained that some of the nagging challenges the industry faced were the subdued economic growth, cyclical markets, sustainability issues, water levels and value addition and diversification.

AgTech Summit, the first of its kind, addressed implementations in the farm, field and supply chain. They also showcased cases from investors, agribusiness companies, plantation owners, start-ups and innovative technology developers.

They discussed infrastructure challenges and government plans to improve farm connectivity, vertical farming, smart farms, smart irrigation, satellite imagery for weather forecasts, drone technology and its application in planting and crop maintenance, among other topics.

Mnisi’s speech also covered strategic sugar industry insights, pricing and supply chain, sugar technology case studies, regional markets and trade, sustainable sugar and new market opportunities.

He said ration, temperature, water, agronomic factors and institutional support were the key drivers of the yield. Mnisi mentioned the European Union (EU), the United States of America, the Common Market for Eastern and Southern Africa (COMESA), Southern African Development Community (SADC), the Southern African Customs Union (SACU) as the trade dynamics of the Eswatini sugar industry.