Sugar industry pledges
R1 billion for transformation
The sugar industry has committed a billion rand towards transformation over a five-year period.
This was revealed by the South African Sugar Association (SASA) Chairperson Hans Hackmann during his presentation on the sector’s long-term transformation plans to Parliament’s Portfolio Committee on Trade and Industry. “The sugar industry commits a total of R1 billion over and above the current commitments to the SPF, the GDA and UAF over five years, commencing in the 2019/2020 season, as an industry obligation, to reciprocity and transformation subject to any amendment to the Sugar Industry Agreement that caters for remedying of inequalities,” said Hackmann.
Below: SASA Chairperson Hans Hackmann briefing Parliament’s Portfolio Committee on Trade and Industry on the sugar industry’s five-year transformation plan.
Transformation expert Vuyo Jack co-presented the industry’s case to the committee. Jack has been advising the industry on developing its five-year transformation plan, which has the backing of all members of the industry. The South African Cane Growers’ Association and South African Farmers Development Association made respective presentations on transformation to the committee.
The SASA Council has agreed on the following principles with regards to the five-year transformation plan:
- In respect of the R1 billion commitment, R142 million per annum will be committed to the remedying of inequalities experienced by black growers plus a minimum of R58 million towards other transformation initiatives. This equates to 0.5% of local market notional sugar revenue. In future, the industry hopes that local market revenues will increase and it will be able to maintain the contribution at 0.5% of local revenue subject to a minimum of R58 million per annum;
- The expenditure by SASA in this regard is to be claimed by individual millers and cane farmers for their respective Agri-BEE scorecards;
- In respect of any new product streams, commitment to reciprocity and transformation will be dealt with at the time in relation to these projects. The industry looks forward to working with the Department of Trade and Industry (the dti) on the initiatives and further transformation it will bring;
- SASA has been advised by South African Sugar Millers’ Association (SASMA) and their members that they aspire to improving their current consolidated Agri-BEE baseline recognition of level 6 to level 3 by the end of the five-year period;
- SASA has been advised by South African Cane Growers’ Association (SACGA) and South African Farmers Development Association (SAFDA) that the cane farming sector has committed to establishing a consolidated Agri-BEE baseline over the next 12 months, beginning January 2019. In the absence of a consolidated baseline score, the cane farming sector commits to achieving a level 4 minimum by the end of the five-year period. The target may be higher pending completion of the Agri-BEE baseline;
- SASA has been advised by SACGA that they aspire to a minimum of 51% of cane being delivered by black cane farmers within ten years (2028);
- SASA has been advised by SAFDA that they aspire to 51% of cane being delivered by black cane farmers in five years’ time (2023);
- SASA to report back to the Parliamentary Portfolio Committee on Trade and Industry and the dti on progress of the above commitments on a yearly basis.
Hackmann stressed that the growth and sustainability of the industry hinged on good working relations with both government and Parliament to help unlock diversification (into fuel ethanol), deliver the land restitution programme, have a sufficient tariff in place and finalise the long-term sugar industry regulations post transitional arrangements which are currently in place.
Cedric is the Communications & Media Manager, External Affairs, South African Sugar Association.