Bloomberg News

Sugar Mills Suspended in South Africa Due to Trucker Strike

October 11, 2012

Two sugar mills in South Africa were forced to suspend production due to the third week of a truckers’ strike just as the harvest season draws to a close.

TSB Sugar, a wholly owned subsidiary of investment company Remgro Ltd. (REM), said two mills in Mpumalanga province have been halted, according to an e-mailed statement. Illovo Sugar Ltd. (ILV), Africa’s biggest producer of the commodity, said cane deliveries to its mills are affected. Tongaat Hulett Ltd. (TON), another producer, said its mills have also been disrupted by erratic supplies.

“The strike action has affected inbound deliveries of sugar cane, resulting in the provisional termination of production processes at the two mills,” TSB Sugar, based in Malelane, said today.

About 20,000 drivers started a strike on Sept. 24 to demand wage increases of at least 10 percent for 2013 and 2014. Employers want a three-year agreement with a 10 percent increase for 2013 and pay rises of less than 10 percent for the following two years, according to the Road Freight Employers Association.

Sugar cane farmers, based mainly in the coastal KwaZulu- Natal and inland Mpumalanga provinces, have been “extensively affected,” Tim Murray, chairman of the 31,000-member Canegrowers association, which represents sugar farmers, said by phone yesterday. “We are still recovering from a drought in 2011,” he said from his farm near New Hanover in KwaZulu-Natal.

Farmers had 16 million metric tons of cane crushed in 2011 compared with 19.2 million tons in 2009, according to data from the South African Sugar Association, an industry supplier. A crop of 18.2 million tons of cane is expected this year.

To contact the reporter on this story: Jaco Visser in Johannesburg at avisser3@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net


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