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Sugar exports surge 29%

by Staff reporter
02 Jul 2021 at 19:45hrs | Views
ZIMBABWE'S sugar exports surged 29% during the full year ended March 2021, driven largely by demand in the east African country Kenya, a local sugar entity has revealed.

In its financial results for the year ended March 2021, listed Hippo valley Estates limited highlighted that its total industry sugar sales volume of 440 000 tonnes (2020:413 000 tonnes) for the year under review was 50%, higher than the 48% in 2020. The Zimbabwe sugar industry has a single marketing desk at brown sugar level, administered by Zimbabwe Sugar Sales (ZSS).

Hippo Valley said total industry sugar sales of 325 000 tonnes (2020:324 000 tonnes) into the domestic market for the year were marginally above prior year, having recovered from low sales during the first quarter of the financial year on account of then existing economic distortions.

"Demand in the local market remained firm despite the Covid-19 low disposable incomes. Industry export sales for the year recorded a 29% growth to 115 000 tonnes (2020:89 000 tonnes) driven largely by a growth in the Kenya market despite a temporary suspension of sugar imports into that market in June 2020. Price realisations on both the local and export markets remained relatively constant in current purchasing power items," Hippo Valley said.

The sugar manufacturing entity said overall cane deliveries from the company's plantations and private farmers were impacted by irrigation power challenges and the dry spell experienced during the 2019-
2020 peak growing period of October 2019 to March 2020.

The wet spell in December 2020 interrupted the harvesting programme resulting in a total of 555 hectares for both the company and private farmers being carried over for harvest in the 2021-2022 production season.

"While the crop in cane from traditional industry sources was compensated for by cane sourced from a third party, sugar production reduced 4% at the back of lower than expected mill efficiencies and inclement weather conditions (incessant rains) which impacted cane quality. Steps were taken during the January to April 2021 off crop period to rehabilitate the mill to ensure improved performance in the 20212022 production year, whilst solar projects to augment electricity at critical water pumping installations are under consideration," the company said.

The company's sugar milling licence was renewed for another 20-year period ending December 2040. These positive actions from the government provide further confidence and stability to the operations, it said.

"The government has since assured the company that it would be granted security of tenure by way of a 99-year lease on Hippo Valley North (23 979 hectares) whilst maintaining freehold title on Hippo Valley South (16 433 hectares). Provisionally, an institutional offer letter was issued by the government whilst the requisite physical planning and administrative processes are nearing completion, paving way for the issuance of a 99-year lease," the company said.

Source - newsday

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