Tracey Mutaviri, the General Manager of Zimbabwe Sugar Sales (ZSS), has conveyed a outlook on local sugar sales in a report presented to the ZSS board, according to Farmers Weekly.
Mutaviri highlighted the challenging situation arising from sluggish local sales, leading to a buildup of sugar stocks. She cautioned that elevated closing stocks would likely result in delays in concluding the 2023/24 season and continue to present liquidity issues for farmers as funds would remain tied up in stocks for an extended period.
Mutaviri stated, “If the current trend persists to March 2024, stocks will potentially close at 94,000 tonnes by March 31, 2024, which will be 64,000 tonnes more than the planned closing stock of 30,000 tonnes. A high closing stock will delay closure of the 2023/24 season and continue to pose liquidity challenges for farmers.”
To support local producers grappling with declining sales, there is a pressing need to halt sugar imports into Zimbabwe. Concerns have arisen that by March next year, the country might be burdened with nearly 100,000 tonnes of domestically produced sugar due to lackluster local demand.
The retail price of imported sugar, primarily sourced from Zambia, Malawi, and Mozambique, matches that of locally produced sugar.
Saul Chin’anga, spokesperson for the Zimbabwe Sugarcane Development Association, questioned the rationale behind Zimbabwe’s ongoing sugar imports, especially when the nation produces enough sugar for domestic consumption and even exports to niche markets like the US, earning valuable foreign currency. He emphasized, “There is, therefore, no need for imports from a supply side. Currently, the country has large stocks of sugar in warehouses. When local sugar sales do not move, farmers are impacted in that they get paid for their sugar based on the cash received price.”
Meanwhile, post forecasts by the US Department of Agriculture’s Foreign Agricultural Service indicated a 3% decrease in Zimbabwe’s sugar exports to 25,000 tonnes in 2023/24, down from 25,692 tonnes in the previous year. This projection is based on a continued decline in exports to the region and restrictive trade policies in Kenya, which was historically the largest market for raw sugar exports before the 2021/22 period.
Additionally, forecasts suggest that sugar production in Zimbabwe could increase by 3% to 410,000 tonnes in 2023/24, up from 396,683 tonnes in 2022/23. This growth is attributed to a higher quantity of sugar delivered to mills, improved sugar cane quality, and consistent sugar mill efficiencies.
