The Zimbabwean market accounted for 71 percent of all of Illovo Malawi Limitedâ€™s regional sales, according to the companyâ€™s annual report for the year ended March 31 2012.
The report indicated that Kenya, Tanzania and Uganda got the rest of the sugar that was sold within the region, which amounted to 35 000 tonnes against the previous yearâ€™s 49 000 tonnes.
At the companyâ€™s Annual General Meeting (AGM) held last Friday in Blantyre, the companyâ€™s chairperson, Graham Clark, pointed out that over 80 000 tonnes of sugar was exported to Europe and the USA.
“Advantage was taken of good prices on offer for the balance of the sugar in excess of local market demand with over 80 000 tonnes exported to Europe and the USA. More than 37 000 tonnes of refined and speciality sugar was exported to Europe for direct consumption whereas t 45 000 tonnes of raw sugar was exported to European refiners.
“Sales into the direct consumption USA market totalled 5 000 tonnes. These exports provided the country with much needed foreign currency and assisted the company in maintaining its operational requirements,” said Clark.
According to the report, total sugar exports during the year jumped by about 16 percent, amounting to approximately 124 000 tonnes against the previous yearâ€™s total of 107 000 tonnes.
“Market conditions were characterised by strong demand from European importers who recognise Malawiâ€™s quality standards and ability to deliver contracted consignments on time,” reads the report.
Domestic sugar sales volumes for the year under review were similar to the previous yearâ€™s, totalling 168 000 tonnes which was approximately 60 percent of all sugar sold for the year. Over 70 percent of this volume was sold through the local retail market as brown pre-packed sugar.
However, the report also revealed that the company faced some challenges in terms of distributing sugar to the market because of the persistent fuel shortages and rising transport costs in 2011.
“Logistical arrangements to move the sugar into the market through the strategically positioned distribution centres throughout the country proved extremely challenging during the year under review, against the background of persistent fuel shortages and rising transport costs,” reads the report.
Going forward, Illovo pointed out that preference will again be given to local consumer market sales and wherever possible, full advantage will be taken of sales opportunities into preferentially-priced export markets in Europe and the USA, as well as regionally to maximise the revenue stream.