Mauritius expects sugar revenue to climb by 25 percent this year, driven by higher prices and increased output, the chief executive of the island’s Sugar Syndicate said on Friday.
Revenue is expected to rise to 10 billion Mauritius rupees ($283.3 million) this year from 8 billion rupees in 2015, Devesh Dukhira told Reuters in a telephone interview.
Sugar, a centuries-old pillar of the Indian Ocean island’s $10 billion-plus economy, now accounts for only 1.8 percent of gross domestic product and employs about 12,000 people.
“We estimate the price per tonne of sugar to rise from 13,166 rupees in 2015 to around 15,000 rupees this year. Sugar output should reach 400 000 tonnes, up from 366,000 tonnes a year earlier,” Dukhira said.
The Indian Ocean island nation aims to benefit from increased sugar consumption worldwide while global production has stagnated.
Dukhira said that global sugar consumption has grown by about 1.8 percent a year in the past 10 years, adding that this was largely due to the world’s growing population and rising purchasing power in China and some African nations.
The biggest challenge for Mauritius is the impending abolishment of European Union sugar quotas in 2017.
African, Caribbean and Pacific producers have benefited from preferential access to protected EU markets in recent years but risk losing market share in the EU after production quotas end in October 2017.
“Though Europe will remain an interesting market for Mauritius sugar, the industry will continue to seek opportunities in niche markets,” Dukhira said.
Mauritius began exporting sugar to Africa two years ago, taking advantage of duty free access to the Common Market for Eastern and Southern Africa.
Once focused on sugar and textiles, Mauritius has diversified into tourism, offshore banking and business outsourcing to cement its reputation as one of Africa’s most stable and prosperous economies.