Stakeholders in the beverage sector have established a task team to look into the challenges facing the local sugar industry in South Africa, including increased imports, the department of trade and industry said on Tuesday.
Sugar production contributes about R14 billion to gross domestic product and the industry employs 85,000 people directly, and a further 350,000 indirectly through food processing and other sectors.
But it is threatened by the sustained increase of deep-sea sugar imports, peaking at just around 500,000 tons in 2017/18 and displacing locally produced sugar into the depressed global market, said South African Sugar Association (Sasa) chairperson Suresh Naidoo.
A task team comprising representatives from the beverage industry, retailers, Sasa officials, small-scale farmers and manufacturers and officials from the Industrial Development Corporation was formed on Monday in a meeting at the Department of Trade and Industry (dti).
“There was a view that through collaboration between government and private sector some better solutions in terms of inclusive growth, transformation, competitiveness and sustainability of the industry can be attained,” a government statement said.
The South African Farmers Development Association says local producers cannot compete against subsidised foreign countries, noting that other sugar producing countries offer their industries a range of policy support measures to protect them against a distorted global market.
The task team will hold its first meeting on Wednesday where it is expected to come up with recommendations to help the local sugar sector.