adminNgoni Dapira Business Correspondent
THE ongoing industrial action at the agricultural and agribusiness sugar giant, Tongaat Hulett Zimbabwe are threatening to trigger sugar shortages and price hikes on the market, Post Business has learnt.
Over 16 000 workers from the Chiredzi sugar giant have been on industrial action since November 27 demanding a salary increment.
The workers, mainly from lower grades, have been staging sit-in protests and have vowed to continue until management addressed their grievances.
Sugar wholesaler, Mr Nzukamanzi Gonye from Chipinge on Tuesday said there were already signs of shortages and price hikes if the industrial action persists.
“It has been nearly three weeks with no sugar deliveries from Tongaat because the employees are staging sit-in protests which are disrupting business. Already the signs are there that there is going to be a shortage and price hikes of the Tongaat sugar, which is favoured on the market to other imported brands,” said Mr Gonye.
The regular wholesale purchasing price of sugar at Tongaat is $1,60 for a 2kg packet, but Mr Gonye said already some people were pushing the commodity at $2,50 on the black market.
“If I buy it at $2,50 that means after factoring in my transport costs I will increase the price of the commodity to retailers to $3,50, which is $1,30 more from the standard $1,70,” said Mr Gonye.
Another sugar wholesaler, Mr Lloyd Mapunga concurred that scarcity of the commodity would pave way for high priced black market charges.
“During the hyper inflationary Zimbabwe dollar era scarcity of sugar was the major contributing factor to black market prices.
“So long the industrial action continues, the shortage will trigger a hike in prices.
“Management should just reach a compromise with the workers and resume production,” said Mr Mapunga.
He added that the ban on sugar imports pronounced in November with immediate effect would also fuel the shortages if Tongaat remained closed.
During his Mid-term Fiscal Policy review in July the Finance and Economic Development Minister Patrick Chinamasa removed from the travellers rebate grocery items such as maize-meal, meat, sugar and flour, to cut down the influx of cheap imports.
In November, Government also banned the importation of sugar, mealie-meal and flour, among other farm produce products with immediate effect.
Government withdrew import licences from individuals and companies that imported farm produce locally available in profusion.
The Deputy Minister of Agriculture, Mechanisation and Irrigation Development responsible for Cropping, Davis Marapira said the ban on imported cheap sugar from countries such as Malawi and Swaziland was meant to protect the viability of the local sugar industry.
Tongaat Hulett corporate affairs and communications manager, Ms Adelaide Chikunguru said in statement on Wednesday that engagement efforts with the Zimbabwe Sugar Milling Workers Union were underway.
She added that the Ministry of Public Service, Labour and Social Welfare was leading the engagement effort between the parties.
“The operations remain hopeful for a positive and mutually beneficial outcome.
“Tongaat Hulett reaffirms its commitment to ensuring a mutually beneficial and positive outcome from the engagement process,” she said.
Ms Chikunguru however said, meanwhile, the collective job action continues with a few incidents of vandalism having been recorded.
She cited an incident last week Thursday where there was arson at the Hippo Valley Estate which destroyed 0.7 hectares of 10.2 month-old cane. The matter is being investigated by the police.
The workers want their minimum monthly wage to be increased to $350 from $170, which would be at par with Tongaat’s subsidiaries in Swaziland, South Africa and Mozambique.
Tongaat Zimbabwe owns Hippo Valley and Triangle estates and sugar mills in the lowveld region, which have a combined milling capacity in excess of 4.8 million tonnes of cane annually and over 640 000 tonnes of sugar.
Online Reporter