Seprod to make US$10m bet on liquid, refined sugar
Seprod Limited, owners of the Golden Grove sugar estate, says it can have a liquid sugar plant up and
running in just over a year provided that CARICOM regulations align in favour of a regional producer.
The company plans to add liquid sugar to its slate of value-added products but is still exploring the best jurisdictions to set up operations.
Seprod CEO Richard Pandohie told Sunday Business that his company has already visited other plants to assess the scope of work needed to create its own, with plans actively being pursued.
"We are looking at putting down facilities, not necessarily only in Jamaica, where we convert to liquid sugar to sell to the beverage companies," Pandohie said of the market to be tapped.
Seprod forecasts start-up costs at under US$10 million, Pandohie said. That currently translates to around $1.2 billion.
With the liquid plant, Seprod will also be positioned to add refined sugar to its offerings with just a "another module" needed to be added to the equipment, Pandohie said.
If those ambitions are realised, Golden Grove would become the first Jamaican company to produce refined sugar and liquid sugar. Other sugar producers have been known to flirt with the idea of manufacturing granulated sugar, but none have been known to devise a plan that is economically feasible.
But Pandohie believes it's doable.
"It will not cost as much as people think. We have looked at facilities, and it will only take another module to create the refined sugar," he said.
Fresh out the blocks with its marketing licence, Seprod has already launched its own packaged products and has also begun exporting sugar to Barbados.
Another 10 containers are to be shipped to Barbados in the coming days; 10 containers are soon bound for Trinidad & Tobago; and six are slated for the United States, Pandohie said. Cayman Islands is next.
However, with regional discussions on sugar set to be held in a matter of weeks, the CEO said the company is pensively awaiting the outcome before moving ahead with plans for the new plant.
"Just a few weeks ago, the Trinidadian government announced that it was removing the CET from refined sugar. Those are the things that would make the investment not worthwhile for us," Pandohie said.
"We need the regulatory framework to be put in place from a CARICOM level before we sign off on the investment," he said.
To make liquid sugar, there is a decolourisation process where the brown colour is removed from the sugar, "and then you basically melt the sugar crystals," Pandohie said. "That's how you get clear liquid sugar that you can then sell to the beverage industries."
The product can then be recrystalised, resulting in refined or white sugar, he said.
"The packaged sugar is the tiniest of baby steps in value added," the Seprod boss said of the company's push to make its sugar business profitable.
"We want to hear the outcome of the meeting in Guyana next week. The intent is, if in two to three months we clear all those (regulatory) hurdles the project period is nine months then it would be 10 to 15 months," Pandohie said of the projection to commission the plant.