By Alois Vinga
AGRI-PROCESSOR, Hippo Valley Estates has revealed plans to export sugar to the United States and Kenya as part of the firm’s export strategy.
In a recent update, chairman Dan Morokane said the sugar processor is targeting both regional and international export destinations.
“A season total of 136 000 tons has been allocated to the export market of which 58% has already been contracted to date. A significant volume of 97 500 tons will be exported to Kenya and 18 198 tons to the United States,” he said.
To date, export sales of 32 080 tons were achieved during the quarter compared to 14 587 tons over the same period in prior year, benefitting from increased sales into Kenya.
The developments come at a time when most companies operating in Zimbabwe are working towards exporting their products to foreign markets in a bid to raise foreign currency.
However, market experts speculate that such developments may lead to critical shortages on the market where customers normally trade in local currency.
The firm managed to harvest 275 293 tons of cane harvested for the three months ended June 2020 registering a minus 12 % decline when compared to a similar period last year.
During the same period, private farmers’ harvest recorded a minus 6 % production decline while the whole sugar cane industry registered an 8 % decline.
However, total industry sugar production for the current year is set to be between 445 000 and 455 000 tons exceeding prior year production of 441 000 tons, with the company’s share of production estimated at 50%.
The firm said demand for sugar in the domestic market remained relatively high during the quarter period with consumers stocking up ahead of winter and as a precaution in light of Covid-19 resulting in speculative trading by some traders capitalising on pricing distortions on account of exchange rate differentials.
This industry has since taken measures to minimize speculative trade with expectations that the new currency auction system will stabilise the situation.