Report Highlights: 

For the 2014/15 MY, post forecasts that Swaziland could produce 725,000 MT of sugar, on an six percent increase in sugar cane production, due to more land being utilized for sugar cultivation. As a result, post expects that Swaziland’s sugar exports, mainly to the European Union (EU), could increase by about three percent to 385,000 MT. In the 2013/14 MY, sugar production increased by three percent from the previous year to an estimated 679,934 MT and Swaziland exported about 373,523 MT of sugar to the EU.

Executive Summary 

For the 2014/15 MY, post forecasts that the area under sugar cane cultivation in Swaziland will increase by three percent to 61,000 hectares. This will under normal climatic conditions results in a sugar cane crop of 6.0 million metric tons (MMT). In the 2013/14 MY, Swaziland produced 5.6 MMT of sugar cane, marginally less than in the 2012/13 MY, on 58,979 hectares. 

Post forecasts that sugar production in the 2014/15 MY could reach 725,000 MT (750,375 MTRV), on an six percent increase in sugar cane production, due to more land being utilized for sugar cultivation. In the 2013/14 MY, sugar production increased by three percent from the previous year to an estimated 679,934 MT (703,732 MTRV), due to better cane to sugar yields. 

Post expects that Swaziland sugar exports to the EU could increase by about three percent to 385,000 MT in the 2014/15 MY, due to an increase in sugar production. In the 2013/14 MY, Swaziland exported about 373,523 MT of sugar to the EU, three percent more than the 363,666 MT exported in the 2012/13 MY. 

Sugar cane 

Production 

Swaziland’s area under sugar cane increased by almost 12 percent the past five years, as more small scale farmers took up sugar cane cultivation and access to irrigation increased through significant investments by the Swaziland government, the European Union and donor organizations. As a result, sugar cane production increased by 15 percent to reach its highest level of 5.6 MMT in the 2012/13 MY. Expectations are that by the 2016/17 MY, the sugar cane area will increase to 65,000 hectares and sugar cane production could be more than 6.5 MMT. 

For the 2014/15 MY, post forecasts that the area under sugar cane cultivation will increase by three percent to 61,000 hectares. This will under normal climatic conditions results in a sugar cane crop of 6.0 MMT. In the 2013/14 MY, Swaziland produced 5.6 MMT of sugar cane, marginally less than in the 2012/13 MY, on 58,979 hectares. 

The structure of the industry 

Sugar production is Swaziland’s biggest industry. Swaziland is also Africa’s fourth largest producer of sugar (after South Africa, Egypt and Sudan). Sugar production accounts for almost 60 percent of agricultural output, 35 percent of agricultural wage employment, and contributes about 18 percent to Swaziland’s Gross Domestic Product. All sugar cane in Swaziland is grown under irrigation, achieving average yields of above 100 metric tons of cane per hectare. 

The sugar industry in Swaziland consists of four components, namely, large millers and estates (77 percent of production); large growers (17 percent of production), medium size growers (5 percent of production) and small growers (1 percent of production). While accounting for a smaller volume of total production, the largest number of growers falls under the category of medium and small growers. South Africa’s three biggest sugar companies, Illovo Sugar Ltd, Tongaat Hulett Sugar Ltd, and Tsb Sugar RSA Ltd are involved in the Swaziland sugar industry through their co-ownerships in production estates and mills. Swaziland has three sugar mills, namely, Mhlume, Simunye and Ubombo with a combined annual production capacity in excess of 800,000 tons. Sugarcane growing in Swaziland is only permissible through a quota issued by the Sugar Industry Quota Board. 

Sugarcane growers and millers are, respectively, represented by the Swaziland Cane Growers Association and the Swaziland Sugar Millers Association. The interests of the different industry players are reconciled within the framework of the Swaziland Sugar Association. The Swaziland Sugar Association was formed in 1964 and is govern by the Sugar Act of 1967. The Swaziland Sugar Association is responsible for providing the services necessary for the general development of the industry and the marketing of Swaziland’s sugar. 

The Swaziland Cane Growers Association and the Swaziland Sugar Millers Association are equally represented on the Swaziland Sugar Association’s Council, the highest policy making body in the sugar industry. The Council is chaired by an independent person, who has no interest in the growing, milling, and marketing of sugar.

Sugar 

Production 

Post forecasts that sugar production in the 2014/15 MY could reach 725,000 MT (750,375 MTRV), on an six percent increase in sugar cane production, due to more land being utilized for sugar cultivation. In the 2013/14 MY, sugar production increased by three percent from the previous year to an estimated 679,934 MT (703,732 MTRV), due to better cane to sugar yields. In the 2012/13 MY, Swaziland produced 658,137 MT (681,172 MTRV) of sugar. 

Consumption 

The South African Customs Union (SACU) is an important market for the Swaziland sugar industry. The SACU market comprises South Africa, Botswana, Lesotho, Namibia and Swaziland. Access to the market is regulated by the Southern African Development Community Sugar Cooperation Agreement. South Africa and Swaziland are the only two sugar producing countries in SACU. The region’s sugar demand is estimated at approximately 2.2 MMT (2.3 MTRV) or 37kg per capita. In the 2012/13 MY, the South African sugar industry supplied 1.6 MMT (1.7 MTRV) to the SACU market and Swaziland about 302,043 tons (312,615 MTRV). The rest of the sugar demand was met by imports (218,490 MTRV), mainly from Brazil. In the 2013/14 MY, Swaziland supplied 340,286 MT (352,196 MTRV) of sugar to the SACU market. Post expects that Swaziland’s sugar supply to the SACU market in the 2014/15 MY will be on the same level as in the 2013/14 MY, e.g. 340,000 MT (350,000 MTRV), as the increase in production will be directed to the export market. 

Trade 

The Swaziland Sugar Association is responsible for all sales and marketing of sugar produced in Swaziland. The main export market for Swaziland’s sugar is the European Union (EU), under the Economic Partnership Agreements (EPA) that was introduced in 2009. EPA allows for preferential access to the EU market for Swaziland sugar. The United States also allows preferential access for Swaziland sugar under its Tariff Rate Quota. However, due to higher income realization, Swaziland exported only to the EU in the 2012/13 MY and 2013/14 MY. 

Post expects that Swaziland sugar exports to the EU could increase by about three percent to 385,000 MT in the 2014/15 MY, due to an increase in sugar production. In the 2013/14 MY, Swaziland exported about 373,523 MT of sugar to the EU, three percent more than the 363,666 MT exported in the 2012/13 MY