Big win for small-scale sugar cane farmers
'Small-scale sugar farmers will now have a positive cash flow during the off-crop season'
The South African Farmers Development Association (Safda) celebrated a victory for small-scale farmers after the Council of the South African Sugar Association (Sasa) approved a new premium price valued at around R60-million.
Safda was formed in 2015 to deal with the decline of small-scale farmers and ensure the sustainability of black farmers.
Through its Sugar cane-Based Value Chain Master Plan, Safda sought to ensure small-scale grower support and bring farmers’ prices in line with the local market.
afda executive chairperson Dr Siyabonga Madlala explained that sugar farmers are paid using a recoverable value (RV) which recognises investments made in the production process to achieve sugar cane of good quality.
‘Because of poor economies of scale, long distances to sugar mills, and the inability to own farming equipment, small-scale farmers struggle to produce good quality cane,’ explained Madlala.
‘The RV price is made up of proceeds derived from the sale of sugar and molasses the industry sells to local and international markets. For sugar, international markets are distorted and they dilute revenue for small-scale farmers.’
He said the premium price will not only bring the prices in line with the local market, but also compensate farmers for international market losses and correct disadvantages linked to the scale and location of their operations.
‘It is something to celebrate that Safda is delivering tangible benefits for our farmers in the short period that we have been in existence.’
Madlala explained that the premium price payment will add to the Sasa Transformation Initiatives that were approved on 29 November 2018 to a tune of R1-billion over a period of five years.
‘Small-scale sugar farmers will now have a positive cash flow during the off-crop season, and will be able to invest in their operations to improve yields and take advantage of overall sugar cane prices,’ he said.
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