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SUGAR PRODUCTION DECLINES BY 10.4%

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MBABANE – Sugar sales contribute immensely to the economy of Eswatini as it is one of the highly exported products.

The sugar industry of Eswatini has in the past decade managed to export and excess of nine million metric tonnes (mt) of sugar in Africa and Europe.
The industry was now facing a challenge; sugar production has decreased by 5.7 per cent in the current reporting period. Sugar production was forecast at 613 139mt in 2021/22 from an actual production of 684 563 mt in 2020/21 (a decrease of 10.4 per cent).

Drop

The decline was attributed to the drop in cane production and quality which decreased by 5.5 per cent as production for 2021/22 was forecast at 5 444 050mt from an actual production of 5 759 016mt in 2020/21. There was also a decrease in the quantity of the cane crushed from local farms as it decreased to 5 759 016mt, from 6 001 618mt forecasted in 2020, which projects a 4 per cent decrease. This further nullified the sales of sugar as it dropped by 9.9 per cent, the forecast at 639 874mt in 2021/22 from 709 835mt in 2020/21. The challenges in the industry further affected the rate of exports as they heavily declined by 21 per cent to 210 904mt against 267 139mt in 2020/21. This was outlined by the chairman of Royal Eswatini Sugar Corporation (RES) and Tibiyo Taka Ngwane Managing Director Dr. Absalom Dlamini in the Tibiyo Taka Ngwane annual performance report.

Production

Dlamini said the reduction in production, and consequently sales, were mainly due to poor cane quality in the current reporting period. He said the declined in the quantity and quality of cane crushed contributed to the decrease in production and sales thus affecting exports.  “Tibiyo has substantial interest in sugar markets globally as a result of having invested heavily in the sugar industry from where it derives more than 80 per cent of its income,” he said. The chairman added that the effects of riots and strikes further contributed to the decline in the performance of the sugar industry.
Sugar cane fields were torched by unknown arsonists at the peak of the unrest and about 100 000mt was destroyed.

Budget

“During the reporting period, compared to budget, the Eswatini sugar industry’s production was lower than the budget while sales were relatively on target,” he said. Total assets increased by 7.7 per cent from E2.3 billion to E2.5 billion in 2021. The managing director said the organisation was able to successfully fulfil its mandate of improving, in whatever way possible, the lives of the people of Eswatini, and to partner with government and other stakeholders in their national development efforts. The RES and its subsidiaries have reported that the total comprehensive income attributed to the owners of the company amounted to E302.6 million, which was 40.38 per cent lower than the record results achieved in 2020/2021.

This was mentioned in their condensed results for the year ended March 31, 2022 released yesterday. The company said the reduction was due to the lower cane volumes, 3.2 million tonnes of cane was crushed in the period under review which was seven per cent lower than cane crushed in the same period last year.

Rains

“The current drop was negatively affected by the late arrival of rains, long after the crop had been stressed, pests and diseases in the form of yellow sugarcane aphid and thrip outbreaks,” RES mentions in the statement. RES said the reduction was also caused by the increase costs due to wet cane harvesting and milling, and significant cost escalations in the last quarter of the financial year following the Russian invasion of Ukraine. They said sugar production was commensurately lower at 424 294 tonnes as compared to 461 567 tonnes for the same period last year.

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