KZN sugar mill embraces diversification with sugarcane ethanol biofuel

The Gledhow sugar mill in Stanger, KwaZulu-Natal is poised to sow the first seeds that are expected to launch the biofuel industry in South Africa as support for the diversification of sugarcane has finally been embraced by the government.

The production of biofuel as an economically viable industry in South Africa is no longer viewed as a pipe dream, but an attainable goal aimed at leveraging sugarcane as a key strategic economic resource.

The need for the South African sugarcane industry to diversify its product offerings comes at a crucial time for the region’s sugarcane farmers facing an existential crisis, reports North Coast Courier.

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Since sugar tax was introduced a year ago, the industry has lost about R1.3 billion in revenue with imminent job losses.

Furthermore, 200,000 tons of sugar were exported to the world market due to a surplus in production caused by the drop in demand from the industrial market since the implementation of sugar tax.

Sugarcane farmers faced a further crisis when approximately 500,000 tonnes of cheap imported sugar were dumped on the South African market.

With more than 100 sugar-producing countries around the world all facing overproduction and low prices, the survival of the sugar industry may depend on diversifying beyond sugar production alone.

Recent years have seen an unprecedented global increase in the production and use of biofuel as global demand for the clean, renewable energy source is rising rapidly. Sugarcane ethanol is an alcohol-based fuel produced by the fermentation of sugarcane juice and molasses. Because it is a clean, affordable and low-carbon biofuel, sugarcane ethanol has emerged as a leading renewable fuel for the transportation sector.

Gledhow Sugar Mill production manager Queen Msane overseeing the start of the cane-crushing season.

Ethanol can be used in two ways. It can be blended with gasoline at levels ranging from 5% to 27.5% to reduce petroleum use, boost octane ratings and cut tailpipe emissions. Or it can be produced as pure ethanol, a fuel made up of 85% to 100% ethanol depending on country specifications and can be used in specially designed engines.

Brazil has achieved greater energy security thanks to its focused commitment to developing a competitive sugarcane industry and making ethanol a key part of its energy mix. In fact, Brazil has replaced almost 42% of its gasoline needs with sugarcane ethanol – making gasoline the alternative fuel in the country.

Many observers point to Brazil’s experience as a case study for other nations seeking to expand the use of renewable fuels.

Speaking to the North Coast Courier, general manager of Gledhow Sugar Company Andrew Francis said the move to diversify sugarcane into biofuel was commercially imperative for the sugar mills given the scale of the crisis in the industry.

General manager Andrew Francis.

“The returns from sugar sales have been decreasing globally over the last few decades, as production input costs have risen and domestic and export prices have decreased. The government has looked at producing biofuel from sugarcane for close to ten years but up until now there has not been sufficient support,” said Francis.

However, the tide has shifted as world sugar surpluses are expected to continue into the foreseeable future, and the unmitigated dumping of excess sugar from foreign markets will further destabilise the industry, threatening employment.

According to Francis, Gledhow sugar mill will be one of the key mills in the country that will diversify its sugarcane production into an alternative biofuel.

A committee made up of key industry players was recently formed that will engage with government to support the industry and government’s efforts to find alternative markets for sugar such as ethanol production and can-based packaging.

Francis said: “There is no sugar industry in the world that can survive on the current world sugar price. None of the local sugar mills made money this last financial year. We either downsize our operations, which means shutting down four mills around the country, resulting in around 100,000 job losses, or we change our factory to produce alternative markets for sugarcane that will create an opportunity to grow the industry.”

Francis believes South Africa could become a world leader in the production of biofuel as an alternative green fuel.

“It has the potential to create hundreds of thousands of new jobs through diversification. We have an industry completely in crisis and the opportunity is here to turn this around,” he said.

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