South Africa accelerates sugar industry diversification under phase 2 master plan to 2030

SOUTH AFRICA – South Africa’s sugar industry is set to accelerate diversification efforts beyond traditional sugar production following the signing of Phase 2 of the Sugar Cane Value Chain Master Plan to 2030, with innovation and new product development at the core of the sector’s strategy. 

The agreement was signed in Durban under the oversight of Zuko Godlimpi, Deputy Minister of Trade, Industry and Competition, marking a renewed commitment by government, industry and labour to reposition the sector. 

Godlimpi said the second phase represents a turning point, moving the industry away from a prolonged period of instability toward a more growth-focused trajectory. 

“The department is committed to accelerating growth and improving diversification through social impact. I also challenge the industry to aim for significant growth and target an increase in South Africa’s domestic fuel production from 40% to 55% through substantial investment in technology and operations,” Godlimpi said. 

A central component of the plan is diversification into higher-value products, including biofuels and industrial outputs derived from sugarcane. The strategy aims to transform perceptions of sugarcane and unlock new economic opportunities. 

“We want to get to a point where people don’t only see sugarcane as an agricultural product but also as an engineering product,” Godlimpi added. 

He emphasised that achieving these goals will require upgrades to existing infrastructure, the adoption of new technologies, and improved efficiencies across the value chain to reduce historical value losses and create future-focused employment opportunities. 

Another key pillar of Phase 2 is inclusive growth, particularly through continued support for black small-scale growers, who are seen as critical to the sector’s sustainability. 

“The retention of black small-scale growers is a critical element of the Master Plan. Phase One has reinforced small-scale growers as being foundational to the industry. The retention of black small-scale growers is also critical to the master plan. Phase Two will cement this position and ensure the sustainability of these growers,” Godlimpi said. 

Industry stakeholders have also welcomed the renewed focus on diversification. Rex Talmage, acting chair of the South African Sugar Association, said the plan provides a structured pathway for transformation. 

“We look forward to the plan taking the industry to the year 2030 and transforming positively, retaining and creating more jobs; we are all committed to the process,” Talmage said. 

However, he cautioned that structural challenges remain, particularly regarding trade dynamics and import pressures. 

Deep-sea sugar imports exceeded 197,000 tonnes for the 2025/26 season by the end of February, leading to estimated revenue losses of R1.5 billion (US$90.73M). 

“With the Dollar-based Reference Price unchanged since 2018, an adequately calibrated reference price is not a narrow tariff matter, but it is the enabling condition upon which every other commitment we make depends,” Talmage said. 

He added that an effective tariff regime, supported by the International Trade Administration Commission of South Africa, remains critical to ensuring the success of the industry’s transformation and long-term sustainability goals. 

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