The unrest in KZN cost the sugar industry 84 million rand after damaging 500,000 tonnes of cane

More than 500,000 tonnes of cane were damaged in arson during unrest in the country last month. (Image: Getty Images)

  • The sugar industry lost 84.5 million rand due to the cane damaged during the unrest and riots in KwaZulu-Natal.
  • Over 500,000 tonnes of cane were burned and damaged.
  • Today, sugar factories reject damaged canes, costing the industry millions.
  • For more stories go to www.BusinessInsider.co.za.

The South African sugar industry has lost more than R84 million after hundreds of thousands of tonnes of cane were damaged in arson during riots and unrest in KwaZulu-Natal last month, announced Tuesday South African Association of Canegrowers.

Over 500,000 tonnes of sugar cane were burned during the unrest. Most of them can no longer be treated because of the damage. The mills in Kwa-Zulu-Natal did not take a cane because of the damage caused by the fire.

Since the unrest, 135,222 tonnes of damaged cane worth over R84.5 million have been turned away from the mills. At the height of the unrest last month, the association estimated that sugar cane farmers could lose as much as Rand 300 million if factories could not crush the 500,000 tonnes of cane burned in arson.

“These fears are now materializing,” said Andrew Russell, president of the South African Canegrowers Association.

Last month, riots and looting broke out mainly in KwaZulu-Natal, one of South Africa’s major sugar-producing provinces, and parts of Gauteng, causing significant damage to businesses, infrastructure and to property.

The unrest is a further blow to the industry, whose woes are compounded by severe droughts, cheap imports and the sugar tax. Industry fears that fallout from the unrest has the potential to cripple the industry.

Hit the small producers

The refusal of the factories to process the 135,222 tonnes of damaged cane is a severe blow to the development of the industry. Of this figure, about a quarter, or 38,000 tonnes, is owned by small producers, many of whom are uninsured and whose chances of recouping lost income are slim.

For now, it looks like they won’t be receiving state aid.

“While many await help from the Grocane Fire Insurance Cooperative and the South African Special Risk Insurance Association (SASRIA), they [the growers] were also told that any cane that was burned before the factories closed will not be covered by these entities, although many factories only closed after a large amount of cane had already been targeted by arsonists, ”SA Canegrowers said.

The association is now seeking financial assistance from several government entities for cane planters severely affected by the riots. He contacted the Ministry of Trade, Industry and Competition, the National Council for the Marketing of Agricultural Products, the Agricultural Finance Unit of the Industrial Development Company and the Parliamentary Portfolio Committee on Agriculture, land reform and rural development.

The association carried out monitoring visits by the parliamentary portfolio committee last week, which shed light on the extent of the damage in KwaZulu-Natal. He also met with IDC to discuss possible bridging funding for affected producers.

The association said the financial intervention would reduce the impact felt by producers and allow them to stay afloat, continue their activities and retain workers.

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Rachel J. Bradford