South Africa’s sugar industry needs a collaborative effort aimed at diversifying its sugarcane-based product offerings, says rum distillery Sugar Baron. The company is creating value-add in the local value chain using sugar as a derivative for its rum beverages range.

Diversification is important, as the local industry faces the adverse effects of imports, input costs and taxes, says Sugar Baron head distiller Brad O’Neill.

“Our goal has been to create a product that not only celebrates the quality of South African sugarcane but also contributes to building a more diversified and resilient industry.”

The uptick in imports is reducing the local industry’s competitiveness, making the identification of diverse sugarcane-based products a necessity for long-term sustainability.

“By investing in these types of value-added applications, the industry can create additional revenue streams, stimulate rural economies, and strengthen the long-term viability of sugarcane farming,” he adds.

These diversification streams include the production of bioethanol, bioplastics, bio-based chemicals and distilled spirits, animal feed, agricultural byproducts as well as electricity using bagasse.

Sugar Baron also has to deal with financial strain because of the current crisis. The company believes that if this trend continues, jobs will be lost, companies will close, and the economy will weaken.

Other challenges – such as rising production costs, climate variability and global price pressures – have a detrimental effect on all players, but particularly on small-scale growers and value-add producers.

Consequently, O’Neill notes that local industry should adopt diversification measures, explore alternative export opportunities and contribute to existing product development for expanding original sugarcane-derived products.

Further, he says an overhaul of the entire sugar industry, including existing policies and regulatory frameworks, is needed to enhance competitiveness, as is the implementation of an appropriate and robust deep-sea import duty, facilitating an enabling environment for local stakeholders without alienating trade partners.

Sugar industry participants must also establish a culture of collaboration to develop the industry, in addition to considering education and training, innovation and product development, as well as significant diversification opportunities.

Sugar Baron is focused on developing new products to expand market access, locally and internationally.

The company also continues to contribute to the initiatives created by government and sugar industry organisations to research and develop the best diversification and product development opportunities for small producers and downstream manufacturers.

“By investing in innovation, diversification and value-added production, the country can position itself as a leader in a range of sugarcane-derived products ,” he concludes.