starafricacorporation lurches into a quandary
....As cheap imported sugar floods Zim market
BUSINESS REPORTER
Sugar processor,starafricacorporation, has lurched into a quandary following the influx of cheap imported sugar and raw sugar shortages, a situation threatening its viability, Business Times can report.
It follows the announcement of a muted performance by starafricacorporation in the 12 months to March 31, which resulted in a loss of ZWL$1.7 bn as opposed to a profit position of ZWL$2.33 bn reported in the prior year.
Rungamo Mbire, the board chairman of Starafrica Corporation, stated in a statement that the company faced shortages of raw sugar in addition to increased competition from low-cost imported sugar from Brazil, South Africa, and Eswatini.
“During the year ended March 31, 2023, sales volumes of granulated sugar produced by Goldstar Sugars (GSS) were stagnant, having been 82,500 tonnes sold in the prior year to 82,321 tonnes. This was on the back of pressure from imports after the promulgation of Statutory Instrument 98 of 2022.
Later, the country’s sugar import duties were halted by the Ministry of Finance, Economic Development, and Investment Promotion. Power outages and shortages of raw sugar also had a negative impact on output.
As a result, production volumes decreased by 6% during the year under review, from 82,399 tonnes in the previous year to 77,270 tonnes, according to Mbire. According to him, the group anticipates that the government will reintroduce duties on imported sugar, a move that will benefit the local industry.
Despite these difficulties, starafricacorporation’s turnover increased by 30% in the year under review to ZWL$50.1bn in the reviewed period from ZWL$38.5bn reported in the prior year. Mbire said the Country Choice Foods (CCF)’s products continued to dominate the market on the back of competitive pricing.
This has positioned the CCF products among the most affordable in the market resulting in the sales volumes increased by 9%, from prior year’s 1,879 tonnes to 2,048 tonnes.
The growth in sales volumes was supported by an improvement in the production of sugar specialties, from 1,920 tonnes last year to 2,140 tonnes in the year under review.
