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South African Sugar Output to Rise to Pre-Drought Levels on Rain

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Jan. 23 (Bloomberg) -- South African sugar output in the 2013/14 season is set to return to levels last seen before a drought that curbed production in the biggest growing region as weather improves, the country’s cane-growing association said.

“The recent rains experienced in most regions will have a positive impact on the crop,” said Jayne Ferguson, a spokeswoman for the South African Cane Growers’ Association, said by e-mail today. “One can expect an improvement in the crop level year-on-year, with a return to a more normal crop between 2.2 million metric tons to 2.3 million tons in sugar production.”

South Africa is the continent’s biggest producer of the sweetener. Output of saleable sugar fell to the lowest in at least 13 years in 2012 after a two-year drought in the KwaZulu-Natal province cut yields.

Africa’s largest economy produced 1.82 million tons of sugar in the year through March 2012. The country’s output may climb 7.5 percent to 1.96 million tons in the 2013 season, the South African Sugar Association said in its December estimates, published on its website on Jan. 21. That’s 1.9 percent lower than the November prediction.

A nationwide strike by about 20,000 truck drivers, which started on Sept. 24 and lasted for three weeks, halted production at sugar mills.

“The transport strike prevented cane reaching the sugar mill for crushing, contributing to the recent estimate having being brought down,” Trix Trikam, the executive director of the sugar association, said in an e-mailed response to questions on Jan. 23.

Producers probably crushed 17.3 million tons of cane in the season through March compared with 16.8 million tons a year earlier, the association said in its December estimate.

Raw-sugar futures for March delivery rose 0.5 percent to 18.21 cents a pound after reaching 18.08 cents yesterday, the lowest for a most-active contract since August 2010.

Tongaat Hulett Ltd. is South Africa’s biggest producer by market value.

To contact the reporter on this story: Tshepiso Mokhema in Johannesburg at tmokhema@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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