– cash shortage as world prices plunge by half
There is some good news and then more bad news for the sugar industry this year. The industry has been able to, for the first time in nine years, exceed its targeted production.
But the price for sugar on the world market has almost halved compared to last year, leaving the finances of the state-owned Guyana Sugar Corporation (GuySuCo) in a continued perilous state.
A statement from the corporation yesterday thanked workers for the production levels.
According to GuySuCo, the grinding operations ended on December 24, with its original 2014 sugar production target of 216,000 tonnes being surpassed. While GuySuCo did not provide the final figure, Kaieteur News was told that it was 216,142 tonnes.
Chief Executive Officer (CEO), Dr. Raj Singh, according to the GuySuCo statement, “cautioned” that there is still much to be done to ensure that the Corporation returns to profitability.
“He expressed the view that the performance of the industry was encouraging and that most of the key performance indicators were achieved.”
In the coming year, GuySuCo would be placing more focus and energy on increasing production, reducing the cost of production, enhancing its mechanization programme, growing the market base and diversifying its lines of business with new products-particularly value added products.
“The corporation, during the current out-of-crop maintenance will focus on getting the factories ready for production by mid February 2015.”
In the coming year, GuySuCo says, it will analyze the effectiveness of the new initiatives that were introduced in 2014 including the use of briquettes for steam generation, bio fertilizers and legume fallow, “among its many other new initiatives”.
In July, GuySuCo officials appeared before the Parliament’s Sectoral Committee, disclosing that the company is producing sugar at an unrealistic US$0.35 per pound and selling for a worrying loss of an average US$0.25 per pound.
GuySuCo’s problem with market prices is also compounded by a steep drop in world prices. Last year was good with Guyana receiving US$715 per tonne. This year, like what happened to gold, sugar slid to US$350 per tonne.
GuySuCo’s officials has asked Opposition Parliamentarians for patience, saying that Guyana will have to wait until 2017, as part of its strategy to turn the fortunes of the industry around, to bring production prices to about US$0.27 per pound.
The industry is facing technical problems, poor prices and low worker turnout with production plunging to a 23-year low in 2013 to 187,000 tonnes.
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