Cumulative sugar sales have dropped 19 percent to 62.4 million kilogrammes in the year to March, raising K7.7 billion (about $30.8m) in revenue.
This is down from the 77 million kilogrammes of the commodity sold during the same period last year raking in K8.3 billion (about $33.2m), a 7.2 percent drop, according the Reserve Bank of Malawi (RBM) latest monthly economic review.
“The drop in sales was largely due to lower stocks carried over to 2012 than in the preceding year,” said the RBM.
Malawians grappled with the shortage of sugar beginning this year up to March because of Illovo Sugar (Malawi) Limited’s control of supplies it releases on the domestic market in anticipation of a new milling season in April.
Illovo argued that most of the sugar meant for the domestic market was exported illegally between October and November 2011 by some unscrupulous traders in search of foreign exchange which has been in short supply.
The shortage, which became acute, triggered a price hike with the commodity selling at as high as K500 per one kilogramme packet.
In a normal season, the sugar manufacturer produces about 300 000 tons of sugar, 60 percent of which is sold locally and the rest is exported to market in the European Union (EU), USA and the African region.
Currently, the supplies of sugar on the market has stabilised and the commodity abundantly available on the market.
The RBM, in the review, said total volume of sugar sales in March 2012 alone amounted to 13.5 million kilogrammes valued at K2.1 billion (about $8.4m), a drop of 61.3 percent from 34.8 million kilogrammes sold for K3.9 billion (about $15.6m) in March 2011.
On the other hand, domestic sales were seen at 8.7 million kilograms in the review month compared to 16.3 million kilogrammes in a corresponding month in the previous year.
“Export sales amounted to 4.8 million kilograms against 18.5 million sold in March 2011,” said the RBM.
In the year ended December 31 2011, Illovo Sugar (Malawi) Limited exported 80 000 tons to Europe and the US and 35 000 tons went to Zimbabwe.
“The exports provided the country with the much-needed foreign currency and partly assisted the company in maintaining its operational requirements,” said the company in a commentary.
An enhanced sugar export earning is good news to Malawi as it means more foreign exchange injection into the economy.
Sugar is one of Malawi’s foreign currency earners after tobacco, tea, cotton and coffee.
