ESWATINI’S SUGAR MARKET CHALLENGE

MBABANE – The sugar markets have been challenging due to the world sugar surplus which has caused a fall in world market prices over the past year.

Swaziland Sugar Association (SSA), in its integrated annual report for the 2017/18 financial year, reported that it has had challenges in obtaining markets that offer remunerative prices as in prior years. It was mentioned that the key market, Southern African Customs Union (SACU), experienced an influx of world market sugar imports which eroded the value in this market and displaced Eswatini sugar.

“SSA has also seen the value attainable in the regional markets, which are pegged to the world market, also fall in the past year. The potential in regional deficit markets has been limited by protective measures put in place to protect domestic industries,” reported SSA.

It was stated that maintaining low production costs was key for the sugar industry to remain competitive. It was therefore pointed out that it would be essential to contain costs of sugar cane production because they affect profitability and sustainability of the sugar cane growing enterprises and the industry.

“SSA sells a proportion of its product in markets outside the SACU Market and Common Monetary Area. This presents SSA with risk of currency volatility,” it was noted.
It was also mentioned that SSA was reliant on the effectiveness and efficiency of product distribution channels.

SSA Chief Executive Officer (CEO) Phil Mnisi, disclosed that the Southern African Customs Union (SACU) market, which is the market for the largest share of SSA sugar, saw a drop of 13.5 per cent in the volumes sold into that market.
“This was mainly in response to the market being saturated by imports from the world market,” said Mnisi. 
The CEO stated that revenues dropped by 8.8 per cent from E4.6 billion last year to E4.2 billion this year.

Post your comment

Your name:

Your e-mail address:

Add your comments:

Please enter the code you see in the image:

Image:

Code: