Sugar Act, 1978 (Act No. 9 of 1978)Sugar Industry Agreement, 2000Chapter 7 : South African Sugar Association and Disposal of Crop182 - 184. Redistribution of Local Market Proceeds |
| 182. | The provisions of clause 183 apply to all mills, including sugar beet mills and, in that clause, the expression "mill" includes a sugar beet mill. |
| 183. | In each year, if a mill sells on the local market a greater quantity of refined sugar or brown sugar (including carry over stocks) than the quantity allocated to it as its local market quota in terms of clause 177, that mill will pay to the South African Sugar Association an amount for redistribution amongst those mills which, during that year, sell on the local market quantities of refined sugar or brown sugar, respectively, which are less than their allocated local market quotas, according to the following provisions— |
| (a) | During April of each year, the South African Sugar Association shall provisionally estimate each mill’s local market quotas for refined sugar and brown sugar, respectively, and during the year shall continuously revise such estimates until the quotas are finally determined at the end of the year. References in this clause to a local market quota shall be construed as such quota from time to time so estimated, until finally determined. |
| (b) | The quarters referred to in this clause are sugar marketing quarters as determined by the South African Sugar Association in respect of each year, the last days of which need not co-incide with the last days of the calendar quarters concerned. |
| (c) | In respect of each quarter ending on the last day of June, September, December and March, each mill (“an over-performing mill”) which sells on the local market more refined sugar or brown sugar (“the excess quantity”) than the pro rata share that its local market quota bears to the aggregate quantity of all such sugar sold in the quarter concerned by all mills on the local market, shall pay an amount calculated in terms of paragraph (d) to the South African Sugar Association, for redistribution as hereinafter provided. |
| (d) | The amount payable in respect of each quarter to the South African Sugar Association by an over-performing mill will be equal to the excess quantity sold by that mill during that quarter multiplied by the weighted average of the notional local market price (determined by the South African Sugar Association in terms of chapter 6 applicable during that quarter), less (except in the case of a sugar beet mill) the financial levy imposed by the South African Sugar Association in terms of this Chapter applicable thereto, and less a manufacturing allowance determined according to rules laid down by the South African Sugar Association: Provided that— |
| (i) | the amounts payable for redistribution in respect of the quarters ending on the last days of September, December and March will include a recalculation of the previous quarter or quarters (as the case may be) from the beginning of the year on a cumulative basis; |
| (ii) | the manufacturing allowance will not be deducted from the amounts payable for redistribution in respect of the quarter ending on the last day of June and the manufacturing allowance for that quarter will then be taken into account as a deduction in the recalculation of the amounts payable for redistribution in respect of the quarter ending on the last day of June and the manufacturing allowance for that quarter will then be taken into account as a deduction in the recalculation of the amounts payable for redistribution in the calculation made at the end of the September quarter; |
| (iii) | any amount deducted in terms of the proviso set out in sub-paragraph (e)(i) from the amounts payable to under-performing mills, will be credited in calculation of the amounts payable by over-performing mills for redistribution in respect of the quarter concerned, pro rata in relation to the amounts payable by them, respectively, and those credits will be reversed in the recalculation at the end of the next quarter; |
| (iv) | the calculations to be made at the end of the June, September and December quarters will each be based on the South African Sugar Association’s latest estimate at that time of the respective mills’ local market quotas for the year concerned and the final calculation to be made at the end of the March quarter will be based on the actual local market quotas for that year. |
| (e) | The amounts payable by over-performing mills to the South African Sugar Association in terms of the foregoing provisions shall then be redistributed by the South African Sugar Association to those mills (“under-performing mills”), respectively, which, during the quarter concerned, will have sold on the local market less refined sugar or brown sugar, respectively, than the pro rata shares that their local market quotas bear to the aggregate quantity of all such sugar sold by all mills on the local market during that quarter; which redistribution, subject to paragraph (f), shall be made pro rata in relation to the respective shortfalls of the mills concerned: Provided that, if, at the end of a quarter, an under-performing mill has not realised in full its previous year’s carry-over stocks of sugar— |
| (i) | an amount equal to the value of its unrealised carry-over stocks will be deducted in calculating the amount to be redistributed to that mill in respect of that quarter; |
| (ii) | the debit in respect of the amount so deducted will be reversed in the recalculation of the amount to be redistributed at the end of the next quarter. |
| (f) | If, in any quarter, a sugar beet mill is an under-performing mill, the South African Sugar Association shall adjust the pro rata shares of the amount to be redistributed in terms of paragraph (e) by adding back to the amount to be redistributed any financial levy that will have been deducted from the amount payable by each over-performing mill. |
| (g) | An amount payable by an over-performing mill for redistribution in terms of the foregoing provisions shall be paid within thirty days of the last day of the quarter concerned, except for an amount in respect of the final quarter which shall be payable upon the date on which, in terms of this agreement, the South African Sugar Association purchases carry-over stocks from mills and shall be set off, pro tanto, against the purchase price for such carry-over stocks. |
| (h) | In respect of each quarter, the amounts to be redistributed in terms of the foregoing provisions will be payable on the next day after the amounts payable by over-performing mills are due in terms of paragraph (g) and shall be paid by the South African Sugar Association whether or not it shall have received the amounts payable by over-performing mills. If the South African Sugar Association suffers any loss in consequence of a default by an over-performing mill, that loss will be borne as an industry obligation. |
| (i) | All calculations necessary to give effect to the foregoing provisions shall be undertaken by the South African Sugar Association. |
| 184. | The proceeds of final molasses referred to in paragraph (e) of clause 164, before the deduction of rebates, shall be subject to a financial redistribution amongst mills based on the molasses production of the respective mills, which redistribution shall be undertaken by the South African Sugar Association at the end of each year in accordance with rules laid down by the South African Sugar Association. |