- Zimbabwe's industrial sugar sales increased by 21% to 183,729 tonnes in the half-year ended September 30, 2024
- Hippo Valley's sugar cane production rose by 12% to 725,027 tonnes, while private farmers produced 558,910 tonnes
- The repeal of the statutory instrument has facilitated a revival of local market share for the sugar industry, stabilizing at approximately 51%
Harare- Zimbabwe’s industrial sugar sales have experienced a substantial growth trajectory, increasing by 21% to 183,729 tonnes for the half-year period ended 30 September 2024, as reported by Hippo Valley, the preeminent sugar producer in the nation, commanding over 50% of the local market share.
This growth was attributed to the repeal of free-importation policies, which had previously inundated the market with imports, thereby undermining domestic producers.
During this reporting period, Hippo Valley achieved a notable sugar cane production figure of 725,027 tonnes, reflecting a 12% increase compared to the preceding half-year.
In parallel, private farmers contributed 558,910 tonnes, culminating in a total production of 1,283,937 tonnes, marking a 9% increase overall.
Consequently, the company's sugar output reached 159,426 tonnes, an 8% rise, elevating total industry production to 312,600 tonnes, which represented an 11% increase.
The period 2024 saw the government lift import bans on sugar, leading to a surge of inexpensive, substandard sugar brands entering the market.
Over 16 of these brands, notably lacking Vitamin A fortification, not only jeopardized the viability of the local sugar industry but also posed significant health risks to consumers.
Despite local sugar production exceeding 300,000 tonnes, sufficient to meet market demands, the government opted to open borders, exposing domestic companies to heightened competition from foreign imports.
Local producers, including those in the sugar sector, adjusted their pricing strategies in response to black market rates, as government-imposed exchange rates remained unrealistically low.
This misalignment has rendered basic commodities, including sugar, increasingly expensive in local currency due to the pressures exerted by the prevailing exchange rate conditions.
Rather than addressing the challenges it has created, the government’s decision to open borders has intensified competition from lower-priced foreign sugar, further jeopardizing local businesses and public health.
In neighboring countries, producers benefit from stable exchange rates, incentive structures, and functional currencies, which enable them to offer more competitive pricing for their sugar exports to Zimbabwe.
This stands in stark contrast to Zimbabwe’s economic landscape, characterized by a devalued currency, unrealistic pegged rates, high taxation, and elevated operational costs stemming from electricity tariffs and exchange rate losses.
Despite these hurdles, the repeal of the Statutory Instrument (SI) has facilitated a revival of local market share for the sugar industry, stabilizing at approximately 51%, a slight decrease from 53% in 2023.
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