Business Reporter
Local sugar production is expected to rise 27 percent due to improved water supply following floods that occurred in the country late year and early this year. The recently commissioned $250 million dollar Tokwe Mukosi dam is also expected to play a pivotal role in the recovery of local production. Tokwe-Mukosi dam lies along the Tokwe-Mukosi supply network that provides 80 percent of the irrigation water required by the country’s major sugar producers Triangle Sugar and Hippo Valley Estates.
Apart from the country’s largest inland dam the other dam that lies along the supply network is Lake Mutirikwi.
Tokwe Mukosi dam, which holds 1,8 billion cubic metres of water, is 72 percent full while Lake Mutirikwi is 39 percent full.
The remaining 20 percent is supplied by the Manjirenji-Siya Manyuchi network which comprise the Manjirenji-Siya and Manyuchi dams that are both 100 percent full.
South Africa-based agricultural and agri-processing business Tongaat Hulett, with interest in Triangle Sugar and Hippo Valley Estates reckons that the dam levels are sufficient to spur a recovery in local production that has been coming down over the past three years.
In its latest update, Tongaat has forecast a significant recovery in sugar production over the next two years due to improved water supplies in Zimbabwe and Mozambique.
Local production, which rose from 475 000 in the 2012 /13 season to reach a peak at 488 000 tonnes in the 2013 /14 season, has been falling due to limited irrigation as a result of El Nino induced drought.
Production fell to 480 000 tonnes in the 2014/ 2015 season and reduced further to 412 000 tonnes in 2015 /2016.
In Mozambique production slowed to 198 000 tonnes this season from 232 000 tonnes in the 2015 /16 season. However, following the improvement in water supplies local production is up 10 percent increase to 450 000 tonnes last season.
This season yields are expected to be between 421 000 and 440 000 tonnes. Local farmers who produce a smaller portion of the crop are forecasting an improvement in their yields.
Commercial Sugarcane Producers Association of Zimbabwe (CSPAZ) chair Tawanda Mafurutu said that they are expecting an average output of 100 tonnes of raw sugar per hectare up from 95 tonnes produced last year due to an increase in yield was made possible by the availability of water to irrigate sugarcane.
“We are expecting an increase in yield this year compared to last year. Initially we had projected 97 tonnes per hectare but we have since reviewed it upwards to 100 tonnes,” he said.
Local production is expected to increase to 535 000 and 570 000 tonnes next season.
Local farmers are expected to play a role in increasing production due to the Successful Rural Community project which has seen total private farmer replanted area increasing to 14 781 hectares during the past five years.
895 private farmers delivered a total of 1 138 184 tonnes for milling last season.
Indigenous private sugar cane farmers operating in the low veld were expected to increase to 1 022 from 813 in the 2013 /2014 season due to initiatives that the Tongaat has been implementing together with Government and local communities.
The increased production will see Tongaat’s total production including its South African operations increasing from 1 023 000 tonnes last year to above 1,5 million in 2018 /2019 season.
“The 2017 /18 crop in Zimbabwe and Mozambique will be impacted to some extent by the reduced irrigation and limited replanting that was necessary during 2016.
“The current dam levels following the good rains at the end of 2016 into 2017 will provide full irrigation during 2017/18 leading to a significant crop recovery by 2018 /19. Total sugar production is expected to recover over two years, to between 1 485 000 and 1 588 000 tonnes in 2018/ 19,” Tongaat said in its last update.
A global sugar production deficit of 6,2 percent from 171 million tonnes produced last year has been forecast by the International Sugar Organisation which should help global sugar prices to remain firm.
Global sugar prices went on an impressive rally last year reaching a ceiling of US23,80 cents per pound late September last year and has declined slowly but steadily since then.
Prices are currently hovering around 16,5 cents per pound but analysts expect prices to average 19,6 cents per pound in the last three months of the year and between 14 to 18 cents next year due to a surplus.
Most of the sugar produced in the country is consumed locally while a portion is exported to the EU under an Economic Partnership Agreement. Local consumption has fallen slightly between 2012-2015 from 389 000 tonnes to 350 000 tonnes while exports have been flat at about 200 000 tonnes.
Imports that have been impacting negatively on local production have been reduced due to controls instituted by Government. Sugar is Zimbabwe’s second largest foreign currency earner in agriculture after tobacco.