Background

The South African sugar industry has long recognised the need to promote diverse ownership of agricultural land under sugarcane and have a range of support instruments in place to promote the sustainability of initiatives aimed at changing the ownership profile of sugarcane land. It is worth mentioning that industry initiatives have contributed significantly to the transfer of 21% of freehold land under sugarcane from white growers to black growers.

In order to reach the target of 30% black ownership of freehold sugarcane land by 2014, the industry established an independent land reform entity, called Inkezo Land Company in 2004. Inkezo’s primary objective was to streamline transfer of ownership of land to black farmers, and promoting the sustainability of the new ventures through targeted support services.

However, the lack of a comprehensive and programmatic approach to the restitution of land to dispossessed communities has since emerged as a key challenge to the future sustainability of the sugar industry. The industry has consequently expanded its focus on land reform to also deal with land restitution processes and outcomes. In order to optimally integrate the required support services and structures with those already available in SASA, this expanded activity has been incorporated into SASA’s External Affairs Division. The functions previously carried out by the Inkezo Land Company have been absorbed into this expanded mandate.

In order to process sugarcane cost-effectively, the operational needs of the industry dictate major investments in milling capacity and infrastructure in rural areas, as sugarcane is not a tradable commodity, but needs to be processed as close as possible to its point of production. The financial viability of these significant capital investments in turn is entirely dependent on a sustainable supply of sugarcane in each mill supply area. At a primary level, this interdependency between miller and grower sustainability has been the catalyst for a common industry focus on developing a sustainable supply of sugarcane. The sheer size of economic activity generated in rural areas through the activities of sugarcane cultivation and sugar production, is generating a vast number of jobs in support industries and commerce. The industry's focus on the development of much-needed cane supply is therefore not only impacting favourably on sugarcane farmers and millers, but is also indirectly contributes to the development of secondary economic activity, services and Infrastructure.