Sun | Aug 20, 2017

Stand your ground! - Sugar producers charged to fight for market share

Published:Saturday | March 25, 2017 | 3:00 AMChristopher Serju
Jose Orive, executive director of the International Sugar Organisation

Sugar industry stakeholders are being urged to stand their ground in the face of new and emerging threats to their economic livelihood.

Addressing Thursday's opening ceremony of the two-day regional policy workshop on 'The Caribbean Sugar Industry Post-2017, JosÈ Orive, executive director of the International Sugar Organization (ISO), said the local industry players should prepare to fight for what is rightfully theirs.

"Do not accept the imposition of models or criteria that come from somewhere else. Extrapolate the useful elements therein and apply them to your own reality," the ISO head told industry stakeholders from the region, as well as Europe, at JAMPRO's St Andrew headquarters.

Speaking to The Gleaner afterwards, Orive expanded on this line of reasoning.

"We frequently see people coming from developed countries and telling us in the developing world what to do. Yes, there are useful examples that you can draw from the developed countries - from countries like Mauritius, Fiji, South Africa, Swaziland - but never copy and paste them. God didn't make us twins for a reason. So, Jamaica and the Caribbean must be extra careful in picking out the elements that are relevant to its own reality and putting them into effect full hilt," he emphasised.

 

GREATER COLLABORATION

 

Citing the need for urgent and wide-scale quality diversification of cane sugar produce, Orive recommended greater public-private sector collaboration as a matter of priority.

"You have to start looking at change yesterday. There are countries within the ACP (African, Caribbean and Pacific) block that have transitioned already, but the challenge to produce quality sugar just in time is there for the taking. The sooner you move, the better off you are. If you are ahead of the curve and you hit August, already shifting into second and third gear in a process of change, so much the better," he stated.

"I would strongly recommend that you look at following a path that is Caribbean, similar to the one that my region, Central America, did, which is to negotiate regional trade agreements with consumer markets. South Korea is pulling in about one-fifth of the export surplus of Central America. I don't see why the Caribbean cannot explore such markets and tap into them by a joint effort by government and industry to open up market access."

The 'August' reference is in light of the fact that come September 30, the preferential access to the European Union (EU) long enjoyed by ACP countries will end, with the removal of quotas for beet sugar producers in Europe. Uncertainty about the level of economic fallout from the anticipated decline in demand for sugar from the Caribbean has seen some regional producers already diversifying their product range, as well as tapping into non-traditional markets.

... Jamaica mandated to package, label sugar appropriately

Jamaica has mandated that come July 1, all sugar (raw and refined) sold in the retail trade must be packaged and appropriately labelled to include a nutritional panel consistent with the Jamaica Gold brand marketed through Jamaica Cane Sales Products Limited. However, the jury is still out as to whether this small step in the right direction is too late in the day to save the local industry.

For instance, over the last two years, Barbados has exported the majority of its sugar mainly to the United States, leaving Belize, Guyana and Jamaica to fight for their share of the traditional markets.

However, Belize has been making significant strides, having last year produced 134,000 tonnes out of the accumulated regional output of more than 500,000 tonnes from just one factory. And this is in addition to achieving self-sufficiency in electricity through cogeneration using bagasse (waste cane trash) and producing an extra 11 megawatts for sale to the national grid.

By contrast, Pan Caribbean Jamaica Limited, which operates Jamaica's largest sugar factory at Frome, Westmoreland, has been unable to fully maximise on its multi-million dollar overhaul, whic0h includes cogeneration from the cane waste. Having achieved self-sufficiency in energy a few years ago, the company has been operating below full capacity despite Cabinet approval of a power purchase agreement that would allow it to sell excess energy to the national grid. For this reason, the factory has had to confine its energy to suit its own needs since any extra would go to waste and, therefore, not make economic sense.

christopher.serju@gleanerjm.com