imbabwe: EU to Cut Reference Price On Sugar Imports

Harare — Local sugar producers and other beneficiaries of the European Union preferential status will soon start shipping their produce to the EU without tariffs.

According to the International Sugar Organisation, as part of the reform, the EU will cut the reference price, used as a base for negotiations between sellers and buyers, for sugar imports.

In 2006 the EU started reducing preferential sugar prices and from 1 October 2009 the price will be cut from 448,80 euros (US$604,7) per tonne to 335,20 euros.

Other African countries expected to benefit include Sudan and Mozambique.

Zimbabwe, along with several African Caribbean Pacific (ACP) countries, supply the EU, the world's biggest sugar purchaser, with 1,6 million to 1,7 million tonnes of the commodity each year under preferential deals.

Besides exports to the EU, Zimbabwe also ships sugar to the United States, where it has a 12,012 tonne quota, as well as South Africa, Egypt, India, Malaysia and Canada.

This development comes after the EU announced in June this year they were ready to disburse 2,3 million euros of the 45 million euros the regional block set aside to revamp the country's sugar industry.

Output of raw sugar at Hippo Valley had fallen 15 percent to 297 662 tonnes during the 2008/09 period, down from

348 670 tonnes in the same period in 2007/08.

The country's sugar production has been on the decline since 2000 due to acute shortages of foreign currency, financing, power and inputs. Availability of sugar on the domestic market declined, mainly as a result of the severe price controls and speculative activities.

According to a production report issued by the sugar producer, the industry managed to sell 185 935 tonnes in the domestic market, which is 19 percent lower than the 229 433 tonnes sold in the previous year.

The company said a total of 869 233 tonnes of company- owned sugar cane was delivered in the mill for crushing, compared with 936 976 tonnes achieved in the prior year.

The seven-percent reduction was attributed mainly to the non-availability of mill spares, coupled with reduced cane haulage capacity.

A total of 15 732 tonnes of cane at a yield of 58,9 tonnes cane per hectare was delivered from the Mkwasine Estate joint venture with Triangle Limited, a decrease of 17 percent from the previous season's deliveries of 18 940 tonnes.

Mkwasine Estate out-growers delivered a total of 81 808 tonnes of cane from 2 100 hectares harvested compared to 138 448 tonnes cane from 2 376 hectares harvested in the previous year, at an average of yield of 39 and 58,3 tonnes cane per hectare respectively.

A total of 119 024 tonnes of cane was delivered by the Hippo Mill Group, comprised of the Chiredzi Sugarcane Farmers Association of Zimbabwe and commercial growers under the Zimbabwe Cane Farmers Association.

The Association achieved the production at an average yield of 53 tonnes of cane per hectare, a decrease of 38 percent from the 185 533 tonnes of sugar cane at average yield of 48,8 tonnes of cane per hectare, delivered in the previous year.

source: allAfrica