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Sour time for cane farmers .... New pricing regime threatens to hurt industry

Published:Thursday | January 7, 2016 | 1:00 AMMark Titus

THE NEW pricing regime on the international market is already taking a toll on the local sugar industry as farmers are refusing to sell their produce at the rate being offered by the marketing agencies.

African, Caribbean and Pacific (ACP) sugar producers, including Jamaica, are no longer protected by the preferential pricing arrangement they enjoyed from 1975, following reforms to the European Union's common agricultural policy three years ago, but must now compete on the global front with other sugar-producing states.

"The price being offered for the entire crop is $51,693 ..., with $36,000 per ton of sugar being suggested for first payment. This is not enough," said Sydney Fray, chairman of the Westmoreland and Hanover Cane Farmers' Association, suppliers to Frome Sugar Factory.

"We won't be able to pay our bills. This can only cover reaping and transportation to the factory. They were warned of the new pricing structure, yet SIA put nothing in place ... now, we the farmers, might be left holding the bag."

WE NEED SUPPORT

Local production started on Monday at Frome, one week later than scheduled. The factory is owned by the Pan Caribbean Sugar Company, a Chinese firm.

But the Chinese are not guaranteed the support of its suppliers along the Westmoreland sugar belt, who were expected to provide 200,000 of the 481,000 tonnes of cane needed to make a projected 40,000 tonnes of the sweetener for this crop.

"We are not asking for handouts. We are here between a rock and [a hard place] and need support to manage our cost ... the future of sugar depends on it."

To further compound the problem, Seprod was recently granted agency status, allowing them to market their product outside of the pooling agreement. This is counter to the contractual arrangement that is in place, which sees their sugar being a major portion of that amount shipped to Europe each year.

When contacted yesterday, Karl James, general manager of Jamaica Cane Product Sales (JCPS) would not entertain a discussion on the matter, and Ambassador Derrick Heaven, JCPS board chairman, was not available for comment.