Sugar industry calls for revised sugar tariff benchmark

South African sugar producers call for urgent government action to revise tariff benchmarks, as rising imports threaten local jobs and industry stability.

South Africa’s sugar producers have called on the government to urgently gazette a revised Dollar-Based Reference Price (DBRP), while organised labour has backed stronger protection for the industry as rising imports cut local sales and threaten jobs in KwaZulu-Natal and Mpumalanga.

The appeal follows the completion of an International Trade Administration Commission of South Africa (ITAC) review of the tariff mechanism.

However, the Department of Trade, Industry and Competition (DTIC) said further steps were required before the outcome could be implemented.

The South African Sugar Association applied to ITAC in October 2024 to have the DBRP increased from $680 to $905 a ton.

The reference price is used to calculate the duty on imported sugar when the international price falls below the benchmark, helping to protect local producers from cheaper imports.

DTIC ministerial spokesperson Kaamil Alli confirmed that the department was prioritising the matter but said details of the proposed revision could not be made public before it was gazetted.

“The department is in consultation with National Treasury on the matter as it requires some concurrence before it is gazetted. The details will be shared in the gazette and we are not able to share this publicly at this stage,” Alli said.

Illovo Sugar South Africa said the delay was prolonging uncertainty in an industry already facing higher input costs, inflation, and growing competition from imported sugar.

According to the company, South Africa imported 213,322 tons of sugar from outside the Southern African Customs Union during the 2024/25 season.

It estimated that the displacement of local sugar reduced growers’ revenue by about R1 billion and millers’ revenue by approximately R500 million.

“The sugar industry has engaged constructively and in good faith throughout the review process. What is now required is urgent action to implement the outcome of that process,” Illovo Sugar South Africa managing director Ricky Govender said.

“Every day of delay further weakens an industry that supports hundreds of thousands of livelihoods and contributes significantly to rural economic activity.”

SA Canegrowers chief executive Thomas Funke said duty-paid imports between January and June had increased from 1,619 tons in 2022 to 124,594 tons in 2026, a more than seventy-fold rise in four years.