- Sugar production for 2020/21 forecast to be between 440 000 tons and 455 000 tons
- Industry sugar production forecast to be 50%
- Sugar production for 2020 declined by 11%
Harare – Hippo Valley Estates Limited, a subsidiary of Tongaat Hulett Limited is projecting a rebound in sugar production in 2020/21 after a blip in the past season
“Total industry sugar production for the 2020/21 financial year is forecast to be between 440 000 and 455 000 tons of sugar with approximately 35% being sold into the export market”, said the company.
Hippo also added that the company’s share of industry sugar production is forecast to be 50%.
Meanwhile, sugar production for the company for the year ended 31 March 2020 contracted by 11% to 212 000 tons, from 239 000 tons produced in the prior year.
The decline in sugar production was attributed to a decrease in both the volume and quality of cane resulting in a cane to sugar ratio of 8.0 from 7.8 in 2018.
During the period under review, the company contributed 48% to total industry production unlike in 2019 when the company’s sugar production contributed 53%.
According to the company, total industry sales in the local market decreased by 13% to 324 000 tons compared to 371 000 tons in 2019 as a result of a decline in demand due to erosion of disposable incomes.
Meanwhile, industry export volumes marginally decreased to 89 000 tons compared to 112 000 tons exported in prior year, representing 22% of total sales volumes due to infrastructural damage and other logistical challenges occasioned by Cyclone Idai which impacted exports via Beira.
However, prices on both regional and international export markets were on average 17% higher than prices achieved in prior year.
The company registered a total revenue of ZWL3, 7 billion (2019: ZWL2, 5 billion), an increase of 48% despite a 14% decrease in sales volumes.
This was due mainly to the industry successfully optimizing the market mix in the local market and better realisations from export markets.
As a result profit for the year improved by 33% to ZWL0.8 billion from ZWL0.6 billion in the prior year.
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