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SUGAR INDUSTRY IN MOZAMBIQUE

Since its inception in the colonial period, the sugar industry has always played a significant role in the Mozambican economy, absorbing a notable amount of laborers and occupying top export positions among the national economic production sectors.

The first sugar factories appeared in the center of the country with the establishment of the Companhia do Açúcar de Moçambique in 1893, with the factory located in Mopeia, on the left bank of the Zambezi River and the Companhia do Búzi, in the Búzi Valley, in 1898, by the firm Arriaga & Comandita and the Government of the Colony of Mozambique. During this period, the company mainly directed production toward the domestic market and exports.

The first sugar factories appeared in the center of the country with the establishment of the Companhia do Açúcar de Moçambique in 1893, with the factory located in Mopeia, on the left bank of the Zambezi River, and the Companhia do Búzi, in the Búzi Valley, in 1898, by the firm Arriaga & Comandita and the Government of the Colony of Mozambique. During this period, the company mainly directed production toward the domestic market and exports

The 1970s were a golden age for the Mozambican sugar industry. The establishment of new sugar plantations increased potential production capacity, the utilization of which also increased. Six sugar plantations produced highest level of production in 1972, reaching 321,000 tons of sugar.

With the arrival of independence in 1975, the sugar industry went through a period of stagnation due to (i) the loss of technical and management capacity, (ii) the lack of foreign currency to guarantee the import of spare parts, fertilizers, and quality seeds; and (iii) the war, which not only made it difficult for production to flow but also targeted and paralyzed some factories, losing thousands of jobs. As a result, from 1983 onwards, Mozambique has been a net importer of raw sugar. Production and capacity utilization fell dramatically, reaching a global production of 16,000 tons in 1996.

The adoption of the Economic and Social Rehabilitation Program (PRES) in 1987 allowed the government to prioritize the sugar industry to promote exports, import substitution, and job creation. The government launched campaigns in the following years to attract private investment, implemented factory rehabilitation programs, and strengthened protection for the sugar industry.

The process of reactivating the sugar industry is now considered a success story. After the civil war in 1992, the Mozambican government made efforts to start rehabilitating and modernizing the sugar industry. Given the country’s rich natural resources, good quality soils, regular rainfall, and favorable climatic conditions, it has an advantage in sugar production over any other country in the region. The rehabilitation has increased the area planted with sugarcane from 18,000 hectares in 1993 to over 45,000 hectares in 2013, while sugar cane production and milling soared from 184,502 tons in 1992/93 to 3.4 million tons in 2014/15.


The emergence of sugar factories in Mozambique

The Mozambique Sugar Company, founded in 1893 by the British John Petez Hornung, with the factory located in Mopeia, on the left bank of the Zambezi River, the Búzi company, in the Búzi Valley, created in 1898 by the firm Arriaga & Comandita and the Government of the Colony of Mozambique; the Marromeu factory, created in 1902, on the right bank of the Zambezi River, by the Sociedade Açucareira da África Oriental Portuguesa, a French firm. In 1910,Sena Sugar Factory, Limited, owned by John Hornung, acquired this factory. In 1920, it became Sena Sugar Estates. The factory in Luabo, created in 1922 by the firm Sena Sugar Estates, started operating in 1924.

In 1913, a modest factory, Incomati Estate, was established beside the Incomati River with a milling capacity of 50 tons of cane per hour(tch).

This factory was acquired by a group of Portuguese in 1953 and 1954,who doubled its capacity. (added a comma after ‘1954)

In 1966, another group of Portuguese set up Açucareira de Moçambique, whose first campaign dates to 1970.

At the end of the 1960s, Marracuene Agrícola Açucareira (MARAGRA) was created, and its factory began operating in 1969.

 

Current situation

From the mid-1990s, a rehabilitation strategy was drawn up by the National Sugar Institute and approved by the government, culminating in the rehabilitation of four of the six sugar factories through direct foreign investment and state-guaranteed loans. As part of this process, a flexible surcharge was imposed on imported sugar, allowing for the creation of a domestic market, making sugar production in Mozambique viable and funding the rehabilitation of the industry.

The companies that own the sugar plantations have continuously invested in the socio-economic development of the regions where they operate to complement the government’s investment in these areas.

These sugar companies have combined their efforts to ensure that they contribute to rudimentary health services, maintaining a workforce in good health.

 In the education sector, they built new classrooms, provided teacher accommodation, and covered general infrastructure maintenance for local schools.

The sugar industry has significantly contributed to the GDP and agricultural sector income since 2000, experiencing sustainable growth due to economic and political stability and attracting investments.

Since 2014, sugar consumption has remained constant at around 165,000 tons, bucking the trends of previous years characterized by fluctuating consumption.

The collaboration between the government and private investment has played a significant role in bolstering and revitalizing Mozambique’s sugar industry, amidst various challenges. The sugar industry has demonstrated resilience through various strategies, with tangible outcomes achieved through sustainable practices and environmental conservation efforts.

 

KEY SECTOR

Sugar production is a crucial part of Mozambique’s agricultural sector, playing a significant role in the country’s economy. Mozambique's climate and fertile soils make it suitable for growing sugar cane, and the industry has a rich history dating back to colonial times. Over the years, sugar production has undergone transformation and modernization, becoming a key contributor to both domestic consumption and export earnings.

TECHNICAL DEVELOPMENT

The Mozambican sugar industry revolves mainly around the production of raw and refined sugar, with a focus on producing high-quality products for domestic consumption and export markets. The nation has numerous sugar plantations and factories scattered across its regions, each contributing to the overall national output. These farms use modern agricultural techniques and advanced machinery to maximize yields and efficiency.

INTERNATIONAL QUALITY

Exports to regional and international markets have been a significant factor in the growth of sugar production in Mozambique. The country exports sugar to several countries in Africa and beyond, and its products are known for their quality and competitiveness. Global reach has boosted foreign exchange earnings and industry visibility worldwide. Mozambique's sugar production industry continues to evolve, striving for sustainability and competitiveness while contributing to the nation's economic development.

Apamo

APAMO recognizes that promoting agricultural activities in Mozambique is crucial for the country’s economic growth. The sugar production sector is dynamic and plays a fundamental role in the sustainable development of the Mozambican economy, which today employs 80 per cent of its population in agricultural activities.

Sustainability is essential for the development of the sugar industry and environmental preservation, not merely an option.

In a nation where social and economic disparities persist, responsible companies have a vital role to play in improving communities.

APAMO embodies the core values of corporate social responsibility, sustainability, and the circular economy. It encourages its members to engage with the communities in which they operate. This collaboration helps establish long-term partnerships and ensures that the benefits of their success are shared equally.

In addition, adopting sustainability practices can open doors to international markets and investors.

The global demand for sustainable and ethically produced fines is increasing and the Mozambican sugar industry can take advantage of this expanding market by aligning its practices with international standards.

By demonstrating a commitment to sustainability and social responsibility, sugar producers can attract investment and secure lucrative export opportunities.