The practitioners approached the KwaZulu-Natal High Court to terminate business rescue and place the group into provisional liquidation. <\/p>\n\n\n\n
It entered business rescue in October 2022 following accounting irregularities, financial misstatements and governance failures under former management.<\/p>\n\n\n\n
This destroyed roughly R12 billion in shareholder value and severely damaged its balance sheet and access to funding.<\/p>\n\n\n\n
Worsening market conditions also played a decisive role. Domestic sales declined sharply as large volumes of low-priced imported sugar entered South Africa.<\/p>\n\n\n\n
The potential collapse of Tongaat\u2019s operations has been described as catastrophic for the regional economy, with roughly 250,000 jobs supported by the cane-growing sector at risk.<\/p>\n\n\n\n
In response, Trade, Industry and Competition Minister Parks Tau gazetted regulatory changes intended to strengthen the industry.<\/p>\n\n\n\n
However, the South African Farmers Development Association (SAFDA) said the reforms have been widely misunderstood and do not actually deal with imports.<\/p>\n\n\n\n
Speaking in a recent interview<\/a>, SAFDA chairman Siyabonga Madlala said the policy is being misinterpreted as protection against foreign sugar. <\/p>\n\n\n\n \u201cThe regulation that\u2019s been gazetted does not necessarily speak to the deep-sea imports that actually ravage the sugar industry,\u201d he said. <\/p>\n\n\n\n Instead, he explained that the measures focus on how the local industry manages its own production and exports.<\/p>\n\n\n\n The new rules specifically deal with so-called \u201ccarry-over tonnages\u201d, allowing producers to store unsold sugar at the end of a season while still paying farmers. <\/p>\n\n\n\n \u201cWhen we produce sugar, that which we can\u2019t sell in the season, we can actually store it, but be able to pay our farmers and carry it over to the next season,\u201d Madlala said. <\/p>\n\n\n\n \u201cThe regulations allow us to pay our farmers in that season, so it helps us manage our cash flows.\u201d<\/p>\n\n\n\n He added that it also improves the recoverable value price farmers receive. \u201cIt bumps up our RV price in that context so that farmers don\u2019t only get paid in the following season when the sugar is sold.\u201d<\/p>\n\n\n\n However, he stressed the changes provide no protection from imports. He noted that the industry has applied to the International Trade Administration Commission for a tariff review. <\/p>\n\n\n\n \u201cWe are still appealing to the government for swift implementation of the tariff review so that we can be protected from the deep-sea imports.\u201d<\/p>\n\n\n\n The scale of the problem remains severe. \u201cThe sugar imports we are talking about are still ravaging us. We\u2019re sitting with over 150,000 tons of imported sugar as we speak,\u201d he warned.<\/p>\n\n\n\n Madlala argued that imported sugar is frequently dumped below its real production cost due to subsidies abroad. <\/p>\n\n\n\n \u201cMost of the industries in other countries are subsidised by their governments to even export sugar,\u201d he said. <\/p>\n\n\n\n \u201cThe prices you fetch in the market are cheap prices not reflective of the real cost of production.\u201d<\/p>\n\n\n\n Local producers also face higher labour and compliance costs. \u201cWe don\u2019t even compare to those countries in terms of cost of production,\u201d he said. <\/p>\n\n\n\n \u201cOthers don\u2019t even have minimum wage. We are subjected to a minimum wage in this country, and the farming conditions are not the same.\u201d<\/p>\n\n\n\n He warned that the consequences extend far beyond the industry itself. \u201cBy buying imported sugar, it means we are actually exporting jobs,\u201d he said. <\/p>\n\n\n\n \u201cOur country is facing serious unemployment, and it\u2019s not the time we can be exporting jobs\u2014in actual fact, we\u2019ll be killing our local farmers.\u201d<\/p>\n\n\n\n This article has been updated. <\/em><\/p>\n","protected":false},"excerpt":{"rendered":" Despite the gazetted reforms aimed at strengthening the industry, they do not address the imports that contributed to the liquidation of a 134-year-old South African company. <\/p>\n","protected":false},"author":92,"featured_media":826676,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[20371,24784,13343],"class_list":["post-851329","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-opinion","tag-department-of-trade-industry-and-competition","tag-the-south-african-farmers-development-association-safda","tag-tongaat-hulett"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/851329","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=851329"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/851329\/revisions"}],"predecessor-version":[{"id":857439,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/851329\/revisions\/857439"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/826676"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=851329"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=851329"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=851329"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}New rules still help <\/h2>\n\n\n\n
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