Tough sugar market drags RCL Foods earnings lower

Stephen Grootes speaks to RCL Foods CEO Paul Cruickshank about the challenging trading environment facing RCL FOODS, including the severe pressure from declining global sugar prices.

Listen to the interview in the audio player below.

Food producer RCL FOODS has reported weaker half-year earnings, with its sugar division taking a heavy knock from low global prices and rising imports.

For the six months to December 2025, revenue slipped 1.9% to R13.3 billion. Profit at an operating level fell sharply, while headline earnings dropped more than 30%. The company also reduced its interim dividend to 15 cents per share, down from 20 cents a year ago.

The company says the sugar industry is under serious pressure. Global sugar prices have fallen, and cheaper imported sugar is entering the South African market in large volumes.

Although import duties were increased last year, RCL Foods believes the current system is not strong enough to prevent subsidised sugar from overseas flooding the market. As a result, local producers are losing sales and are forced to sell more sugar into export markets at lower prices.

At the same time, costs have continued to rise, but selling prices locally have remained unchanged. This has squeezed margins and hurt profitability.

Speaking to Stephen Grootes on The Money Show, Paul Cruickshank, RCL Foods CEO says imports have impacted the local market significantly.

"We've seen close on 170,000 tons of deep sea imports coming into South Africa, and it's had a significant impact on the industry. Essentially what happens is that displaces local market sales, which then get exported at a much lower international price."

- Paul Cruickshank, CEO - RCL Foods

"Just to convert the 170,000 tons into rand, it's R1,5bn of lost revenue across the whole industry. That's had a significant impact. 

- Paul Cruickshank, CEO - RCL Foods

"There's a surplus of sugar worldwide, and it's largely to do with economies of scale and you need to put a certain footprint down from an agricultural and operational perspective at these mills. What countries do is the surplus they have they export, effectively dump onto the open market."

- Paul Cruickshank, CEO - RCL Foods

Scroll to the top of the article to listen to the full interview.