Online Reporter
Oliver Kazunga-Senior Reporter
PARLIAMENT has ordered the Zimbabwe National Water Authority and Zesa Holdings to prioritise uninterrupted water and power supplies to the sugar industry after an inquiry found the strategic sector is paying for water it does not receive and losing yields to power cuts.
The Parliamentary Portfolio Committee on Industry and Commerce, which is chaired by Mr Clemence Chiduwa enquired into the sugar value chain in terms of Standing Order No. 21 to examine Government policy and expenditure, and established that the current utility model was crippling an industry that employs thousands, earns foreign currency, produces ethanol and feeds electricity into the national grid.
Presenting its findings after recent visits to Triangle and Hippo Valley estates and hearings with the Zimbabwe Sugar Association, Tongaat Hulett, the Zimbabwe Electricity Transmission and Distribution Company (ZETDC) and Government ministries, the committee said ZINWA was billing cane farmers US$6,82 per megalitre on allocation, not actual consumption.
“The prevailing water billing model, which charges based on allocation rather than actual consumption, was found to be inequitable and financially burdensome, particularly when farmers received less water than they are allocated,” it said.
The committee said farmers require about 15 megalitres per hectare per year in the Lowveld, which averages 588mm of rainfall and 23,4 degrees Celsius and relies entirely on irrigation.
Despite huge dammed capacity, the underutilisation of Tugwi-Mukosi Dam shows conveyance infrastructure is underdeveloped, while illegal upstream abstraction is reducing downstream availability.
Farmers are forced to drill boreholes and buy from bulk suppliers, while still paying ZINWA for the allocated amount.
On power, the committee found farmers using overhead irrigation – which exclusively uses electricity – face average monthly bills of ZW1 799,73 per hectare, with ZETDC charging an average of US$4,75/kWh according to evidence from the Zimbabwe Sugar Association.
Power disruptions during critical irrigation periods have caused yield losses.
Despite the two mills – Hippo Valley and Triangle, owned by Tongaat Hulett and controlling 56 percent of the 46 000 hectares under cane – generating power through bagasse co-generation and feeding it into the national grid in the off-season, they receive no preferential tariff.
“Despite contributing power to the national grid during the off-season, millers do not receive preferential tariffs, thereby increasing operational costs and placing pressure on working capital.”
The ZETDC management told the committee it was deploying a smart grid with auto-reclosers and smart meters to prioritise sugar millers and irrigators during outages by curtailing non-essential loads.
The Lowveld has been targeted for solar irrigation projects under the Advanced Net Metering initiative.
Against this background, the committee ordered ZINWA and ZESA to prioritise the sugar industry and commit to uninterrupted supplies — and the Ministry of Lands, Agriculture, Fisheries, Water and Rural Development to transition to consumption-based water billing and rehabilitate conveyance infrastructure from major dams to cut water losses by 30 percent by December 31, 2026.
It was also recommended that the Government should rehabilitate at least 50 percent of rail infrastructure servicing the sugar industry by the same date to cut transport costs by 20 percent, after the collapse of the National Railways of Zimbabwe forced all cane and coal onto road.
The committee found the sector now burns 1,3 million litres of diesel a month – costing US$2,457 million – to truck coal from Hwange that should move by rail, with coal accounting for over 5 percent of the cost of refined sugar. Road charges are US$175 per load and US$44 per five-tonne cane bundle, against rail at US$8 per tonne.
The inquiry found local sugar costs US$890-US$900 per tonne against an import parity price of US$600, undermining competitiveness.
Other recommendations include recapitalisation of NRZ by the Mutapa Investment Fund by December 31, 2026, issuance of bankable tenure to 70 percent of out-growers in two years, a concessional financing facility below 15 percent interest by December 2026, and amendment of the Sugar Production Control Act of 1964 by October 31, 2026.
The committee also called for an independent review of the Division of Proceeds – currently 80,5 percent to farmers and 19,5 percent to millers – which out-growers say favours millers and lacks transparency on cane weighing.
“The sugar value chain remains a critical pillar of the economy with strong potential for growth.
“With appropriate reforms and investments, the sugar industry can significantly contribute to national development,” the committee said.
