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Families depend on sugar for life

Grit is a psychology term made popular in recent times by Dr Angela Duckworth in her best-selling book Grit: The Power of Passion and Perseverance. She defines it as “passion and sustained persistence applied toward long-term achievement, with no particular concern for rewards or recognition along the way”.

The future of the South African sugarcane industry has been under severe threat over the past decade because of weak protection against cheap imports, unprecedented droughts, plunging world sugar prices and a major drop in local demand for sugar thanks to the introduction of the Health Promotion Levy (“sugar tax”).  

With the sugarcane industry supporting one million livelihoods, mostly in rural communities, South African Canegrowers Association has a huge responsibility to ensure that the sector survives and eventually thrives. It has taken remarkable grit to sustain itself and its people.

Thankfully, the first steps towards recovery have already been taken with the signing of the Sugar Industry Masterplan in November 2020. This master plan is the culmination of a year-long process, which saw stakeholders from across the sugar industry value chain come together with government to collaborate on how to stem the decline of the sector and ensure a transformed, sustainable and profitable industry over the longer term, which contributes towards job creation and inclusive economic growth.

The first phase of the plan, which will be implemented over the next three years, focuses on tackling a number of challenges facing the industry including increasing sales of local sugar, exploring alternative crops to sustain farmers’ livelihoods, finding alternative products to sugar and molasses that can sustain the industry, and a review of the devastating effects of the sugar tax.

Action commitment one under the masterplan aims to ensure that the local industry can sell at least 150 000 more tons of sugar on the local market in the next three years, recovering the market share lost to cheap imports.

A month after the signing of the plan in November, SA Canegrowers launched its Home Sweet Home campaign which educates South Africans about the negative effects of cheap imports on the South African sugar industry and encourages them to read the details on the packs and to buy from local suppliers. We are so grateful that the campaign has received such good support — and just last week we had the pleasure of announcing a partnership with Proudly SA to take the campaign message to even more South Africans.

We are confident that this partnership will help to build on the great gains we have already seen in local sugar sales. But it would be wrong to mistake this glimmer of hope for the end of the crisis the industry has been facing.

The Mail & Guardian recently published an opinion by Mbukeni Nyembe, a small-scale grower and member of SA Canegrowers. In it he details the continuing challenges he has faced, such as load-shedding, poor service delivery, little financial support and a lack of interest in farming from young people. These highlight how important it is for all of us to keep our foot on the gas. Otherwise, complacency may prove to be the next great threat.

For starters, we need to think seriously about the potential obstacles that could hamper the effective implementation of the masterplan and act vigorously to eliminate them. For example, since government departments and entities already buy sugar, it would appear that simply directing these transactions to locally produced sugar should be a quick, easy win. Yet it is not clear whether any action has been taken to implement this easily achievable masterplan commitment.

Another challenge is the sugar tax. Despite vociferous support for the  tax, there is no evidence that it achieves its stated objective – to reduce obesity levels. Whereas the health benefits of the tax are at this stage theoretical, its economic consequences are very real.

 Our data shows that the tax has resulted in the loss of more than 9 000 jobs in our sector – leaving tens of thousands of people left without a breadwinner in their family. The effect on rural communities is hard to overstate. This is highlighted by Nyembe who went from employing 16 people at peak down to 10. That is six families in his community who have lost an income. In a country plagued by unemployment, alternative employment is hard to find.

The devastating impact of the sugar tax was confirmed in a study commissioned by National Economic Development and Labour Council (Nedlac) on the socioeconomic impact of the sugar tax. The study found that the tax cost South African 16 621 jobs, R653-million in investments, and R1.19-billion in the Gross Value Added by the sugar industry to the country’s GDP. This vindicates our argument opposing the tax and makes a compelling case to scrap it and restore jobs where they are desperately needed— in rural communities. 

Interventions – government procurement of local sugar and removing unnecessary burdens like the sugar tax – are straightforward, relatively easy, and entirely within the government’s control.

But that is not to say all that is needed is government action. It is also critical that our industry does more to advance transformation and support small-scale growers. This is why the industry has committed R1-billion (with growers contributing R640-million thereof) over the next five years towards programmes focused on empowering and advancing these growers. We want to ensure that farmers like Nyembe can expand their operations, increase their productivity and profitably, and hopefully be able to re-employ their laid-off workers in the near future.

The masterplan has provided a critical opportunity to not only save the sugar industry, but to restructure it so that it continues to be profitable 100 years from now. It will require more grit from government and all stakeholders in the industry to achieve this, but the rewards will certainly be worth it. Most importantly, one million livelihoods depend on our commitment to action and our courage to resist the siren’s call to complacency.

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Rex Talmage
Rex Talmage is chairperson of the South African Canegrowers Association

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