Oct 30, 2016 News
Last year certainly marked a period of “radical change” for the sugar industry. This is according to the
Board members of the Guyana Sugar Corporation Inc. (GuySuCo).
Subsequent to the change in Government, and in recognition of the plight the sugar industry was in, the Board said that shareholders of GuySuCo appointed an Interim Management Committee (IMC) in June 2015 and a new Board of Directors thereafter.
The Board and Interim Management were confronted with many challenges, which included a weakened and demoralized management team, a very adversarial Industrial Relations climate, low sugar prices, declining production levels, high operational costs, serious loss making, a huge debt burden and consequently a major liquidity crisis.
The Board said, “It was evident that the sugar industry was in need of major reorganization; that it could no longer be business as usual. The Board and management team proceeded to develop urgently, a series of initiatives to arrest the situation while the elements of a longer term strategy were being contemplated.”
Given the gravity of the situation, the Board members reminded that the Government, in July 2015, appointed a Commission of Inquiry (COI) to look into the sugar industry, and make recommendations for its return to financial and economic viability.
The Commission Report was submitted to the shareholders in October 2015 outlining the Commissioners’ evaluations of the most economical options for the sugar industry to pursue.
The Board noted that the Commission’s main recommendation was that there should be no closure of any estate but that the Corporation should be privatized within three years. It recalled that other sections of the report pointed to diversification away from the reliance on sugar as an option.
Furthermore, the GuySuCo Board said that there were several initiatives identified in 2015 for implementation this year so as to reduce the operating cost, cash deficit, and/or generate funds for the Corporation.
They said that some of these initiatives included the merging of Wales and Uitvlugt Estates, transitioning the Wales cultivation from sugar cane to other crops and aquaculture, completion of the integration of the La Bonne Intention and Enmore Estates into the East Demerara Estate, relocation of the Information Systems and Head Office Departments from Ogle Estate to the former LBI Estate Compound, the sale of non / under – performing assets in particular lands, and the cost recovery of drainage and irrigation now benefiting external parties.
Additionally, the Board said that it was very encouraged by some of the achievements of the Corporation during the second half of the year 2015.
It said that the second crop’s production reflected a significant improvement over previous years.
Members said that there was a greater sense of purpose across the industry. However, the Board noted that the underlying and deep rooted problems remained which would best be addressed through the reorganization process. The GuySuCo Board said that a new strategic direction for the Corporation is currently being developed.
According to the Board, the main focus for 2015 was on improving factory throughput and reliability. To improve factory output, it was stated by the Board that major modification works were completed on Skeldon’s outboard punt dumper to convert the lifting mechanism from hydraulic rams to cables and winch.
The Board said that the modification proved successful with overall factory throughput achieving a weekly average as high as 260t/hr. Kaieteur News understands that such a level was never achieved since the factory’s commissioning in 2009.
With a steady cane supply and higher factory throughput, Skeldon recorded its highest ever overall recovery of 75.24% since commissioning.
With regard to the Enmore Packaging Plant, the Board said that the production of value added products continued during 2015. GuySuCo said that at least three new brands of sugar were released—Regale, Cuisine and Enmore Crystals.
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