By S’thembile Cele and Loni Prinsloo.
South Africa will raise the benchmark price that’s used to calculate duties on sugar imports, a move long-sought by domestic producers like Associated British Foods Plc’s local unit in an industry that’s been battered by cheap foreign competition, according to people familiar with the matter.
Finance Minister Enoch Godongwana signed off on the measure earlier this week and the new level is expected to be announced in the official Government Gazette soon, said the people who asked not to be identified because the decision isn’t public yet. The dollar-based reference price for sugar will be increased to $785 a ton, from $680, the people said.
The higher amount would strengthen protection for local producers when international prices fall below the benchmark, potentially making it more difficult for cheap imports to displace domestically produced sugar.
The Department of Trade, Industry and Competition referred a request for comment to the National Treasury, which said Godongwana can’t comment on the matter until it’s been gazetted.
The South African Sugar Association’s Vice Chairman Trix Trikam in a statement on Thursday welcomed the adjustment while cautioning that it may be insufficient to protect local producers against imports from subsidised countries like Brazil.
SASA said the industry lost R1.6 billion ($100 million) to cheap imports during the 2025-26 season season. As of June, shipments from abroad had reached 74 652 tons, costing the sector R560 million, it added.
The association had sought a substantially larger increase to $905 a ton, arguing that the existing benchmark — unchanged since 2018 — no longer reflects domestic production costs. The country’s International Trade Administration Commission began a review of the reference price in January after receiving competing applications from SASA and the Beverage Association of South Africa.
White sugar traded at $514.40 per ton in London on Thursday.
The sugar sector has also been under pressure from declining cane returns. Tongaat Hulett, one of the country’s major producers, narrowly avoided liquidation before a rescue agreement involving the state-owned Industrial Development Corp.
Beyond the increase in duties, the industry is seeking longer-term measures to improve its competitiveness, including diversification into sugar-derived products and biofuels. South Africa’s sugar master plan identifies trade protection, pricing and local market demand, as well as industry restructuring and diversification, as key priorities for the sector.
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