Sugar strike set to continue

On Tuesday more than 5 500 workers at Tongaat Hulett started industrial action, demanding an 11% salary increase. The company offered an increase of 8,5%.

Katishi Masemola, Food and Allied Workers’ Union general secretary, said the strike, in its third day today (Friday), was indefinite.

Tongaat Hulett has operations in Mozambique, South Africa, Zimbabwe, Swaziland and Botswana.

The strike followed a breakdown in negotiations, the company said in a media statement.

“We will not call off the strike until our are demands are met. It can be a week or more, but for now it’s indefinite,” Masemola said

Kagiso Asset Management head of research, Abdul Davids said: “Tongaat produced around 634 000t of sugar in South Africa in the 2013/2014 season and a protracted strike might impact volumes negatively.”

He added that, “the quantum of the impact will depend on the duration of the strike.”

“It is difficult to comment on specific wage increases in the absence of detailed information around the affordability thereof for employers like Tongaat,” Davids said.

Following the wage adjustments after the farm workers’ strike in 2012, wage demands for the current period were expected to be closer to CPI, “so 11% is clearly substantially above CPI.”