Sugar scarcity stirs panic, hoarding fears

There is mist on the erratic availability of sugar in some parts of the country with major producer Illovo Sugar (Malawi) plc saying the Ministry of Trade and Industry is better-placed to comment on the issue.

But Ministry of Trade and Industry spokesperson Mayeso Msokera in an interview yesterday said government is yet to establish the main cause of sugar scarcity, a development which has pushed up sugar prices to K2 500 per kilogramme (kg) in some shops.

He said: “The ministry is already engaging the producers of sugar in the country to find a quick solution.

“We are treating this issue as an emergency and government is meeting with sugar producers to establish the cause of the situation and the way forward.”

Msokera said the ministry has received reports of alleged “excessive pricing and hoarding of sugar by some unscrupulous traders”.

He said in dealing with such malpractices, the Ministry of Trade and Industry and the Competition and Fair Trading Commission (CFTC) will intensify market surveillance on prices of sugar across the country.

Illovo Sugar (Malawi) plc managing director Lekani Katandula refused to comment on the sugar scarcity, reffering The Nation to Ministry of Trade and Industry.

He, however, indicated that the Malawi Stock Exchange-listed sugar manufacturer has not raised its prices, saying “our recommended retail price remains K2 000 for a kg of brown sugar”.

Said Katandula: “If traders are selling the sugar above that price, that is a matter for the Ministry of Trade or the Competition and Fair Trading Commission.”

CFTC spokesperson Innocent Helema said in an interview yesterday that they have been conducting weekly market surveillance since November last year to check whether traders are engaging in unfair trading commodity excessively.

He said: “By the end of November 2023, we engaged about 20 companies whom we suspected to have excessively raised prices.

“The outcome of the investigations will be presented to our board for determination.”

Helema said traders found to have violated the law after the conclusion of the investigations and pronunciation of the decisions by the board of commissioners risk fines.

In July last year, amid pressure from the public and local manufacturers to cut the price of sugar, Illovo Sugar said government was free to amend the law and issue licences to other suppliers to bring down sugar prices on the local market.

The listed sugar manufacturer initially opposed a government decision to issue licences to other importers on the basis that the Ministry of Trade and Industry did not consult the sugar manufacturers as prescribed in the Control of Goods Act.

In Malawi, sugar is a protected commodity, according to the Control of Goods Act.

Apart from Illovo Sugar (Malawi), which has a 97 percent market share, the other company is Salima Sugar Company Limited jointly owned by Malawi Government and private investor.

Illovo Sugar (Malawi) plc annually cultivates around 1.8 million tonnes together with about 350 000 tonnes produced by smallholder farmers.

The firm has two estates in Dwangwa, Nkhotakota and another one Nchalo in Chikwawa.

Sugar is the country’s number four top foreign exchange earner, according to the National Statistical Office.