Win for sugar industry in South Africa

The International Trade Administration Commission (ITAC) has announced an increase in the dollar-based reference price (DBRP) of sugar.

ITAC raised the DBRP from $680 up to $785 per tonne after considering two conflicting applications requesting an investigation into the current tariff structure.

The first, submitted by the South African Sugar Association (SASA) on 30 October 2024, called for an increase in the DBRP to $905/tonne to protect the sustainability of the local sugar industry.

The second, submitted by the Beverage Association of South Africa (BEVSA) on 25 September 2025, called for the DBRP to be reduced to between $552 and $650 per tonne.

BEVSA cited, amongst other reasons, the adverse effects that the current sugar duties had imposed on beverage producers, bottlers, and consumers.

ITAC launched a combined investigation into both applications, considering the interests of stakeholders both upstream and downstream of the domestic sugar industry.

The commission found, through its investigation, that South Africa’s sugar industry continued to face a challenging operating environment.

“This was characterised by volatile global sugar prices, increasing import penetration, rising production costs, weakening production volumes and capacity utilisation, and deteriorating profitability,” ITAC said.

“At the same time, downstream sugar-using industries, including the non-alcoholic beverages sector, also experienced rising input costs and operating costs.”

ITAC explained that despite these rising costs, the beverage industry has managed to maintain positive growth in production, sales, and capacity.

While the commission agreed that the DBRP was a critical mechanism for determining sugar tariffs, it said neither party’s application would appropriately balance the needs of both.

It also acknowledged the importance of the domestic sugar industry in creating employment and supporting rural economic activity and livelihoods.

“The proposed DBRP level of $785/tonne would continue to place the SACU sugar industry in a competitive position relative to imports,” ITAC concluded.

“This level would also provide an appropriate level of tariff support necessary to improve the sustainability of domestic industry, protect employment, and support continued investment in the sector.”

ITAC decision welcome, but more can be done

ITAC’s decision to raise the DBRP for sugar has been welcomed by industry stakeholders, who have long called on the commission to review the tariff structure.

The current tariff on sugar imports was last updated in 2018, and groups such as SASA and the South African Farmers Development Association have said it has become ineffective since then.

SA Canegrowers said the decision to raise the DBRP was a critical step in ensuring the sustainability of the domestic sugar industry in the face of rising subsidised imports.

However, chairman Higgins Mdluli cautioned that the adjustment may still not be enough to completely close the gap between local and imported sugar.

“We thank Minister Tau, Minister Godongwana and Commissioner Cawe for listening to the industry and acting on evidence we have provided over the past two years,” Mdluli said.

“This adjustment shows that the government understands the severity of the crisis facing sugarcane growers.”

Duty-paid imports of sugar between January and June rose from just 1,619 tonnes in 2022 to 124,594 tonnes this year, a more than 70-fold increase in four years.

Over the same period, domestic sugar sales reportedly fell by 35%, or 188,000 tonnes. Grower proceeds declined by R1.33 billion, largely due to a rise in the export burden from 22% to 37%.

SA Canegrowers has called on all signatories to the Sugar Industry Master Plan, including retailers and beverage producers, to commit to sourcing locally produced sugar.

“We will be watching closely over the coming months to see whether this adjustment translates into a genuine reduction in the volume of sugar entering the country,” Mdluli said.

“Growers need certainty, not another partial fix. We remain ready to work with government and all stakeholders to ensure the sugar industry can compete on a fair footing.”

South Africa’s sugar industry supports over a million livelihoods, with SA Canegrowers representing 28,000 small-scale and 1,250 large-scale sugar producers across Mpumalanga and KwaZulu-Natal.