Regional sugar producers believe that they have an answer to problems besieging the industry.
They are seriously considering producing plantation white sugar on a large scale to replace the refined white sugar that is being imported from out of the region.
The news would come as Guyana continues to struggle with its sugar industry with four estates closed in the last four years and more than 5,000 workers sent home.
Recently, a draft study- “Study on the Reform of the CARICOM Sugar Regime and Sugar Industry Stakeholders’ Consultation- Study on the Substitutability of Plantation White For Refined Sugar In Regional Manufacturing”, was discussed at a series of meeting, in Belize, involving officials from sugar companies of the region.
Present at the meeting were Harold David from the Guyana Sugar Corporation (GuySuCo); Paul Ryberg, Legal Counsel to the CBI Sugar Group and the International Sugar Trade Coalition; Nigel Durrant from the CARICOM Secretariat; Celestino Ruiz, of the ASR Group; Karl James, chairman of Jamaica Cane Product Sales.
According to the report, the objectives were to provide the CARICOM Secretariat and sugar stakeholders of the Caribbean an assessment of “the substitutability of Plantation White (PW) sugar for refined white sugar in regional manufacturing of beverages and sugar-containing products”.
The draft study found that plantation white sugar could be used once there is work to adjust the production facilities.
“The study has illustrated through consultations, research and the presentation of case studies that plantation white sugar can be, and is being used across the industrial food and beverage sectors, regionally and internationally either as direct consumption sugar or with some additional treatment to meet, in particular, colour and a few related requirements particularly for the carbonate beverage industry and other beverages some of them alcoholic (some are franchise products) but require a clear or transparent appearance where no sign of colour and impurities are visible.”
Importantly, at the regional level, a critical consideration is the investment required in plant and equipment and operational cost by some (not all) food and beverage manufacturers for clarification and testing of a simple syrup made from PW to bring it down to an acceptable level.
The sugar officials were told that the investments in plantation white sugar are feasible.
“This colour requirement would meet the franchise specifications of major beverage producers. The clarification of simple syrup through investment in plant and equipment has been globally established and the investment would more than pay for itself many times over. Also, against the utilization cost of imported refined sugar, there would be an economic advantage for the majority of the time based on historical global sugar prices.”
The report called for investment in improved technology (retrofitting existing sugar mills) to facilitate the production of plantation white sugar particularly to meet colour and sucrose purity levels.
It also urged for sugar producers and other private sector entities to explore option of production of liquid sugars.
“It is a reasonably easy process to treat high quality PW sugars to meet the franchise standards for major beverage companies. Importantly, for most other manufacturing needs, PW is a suitable substitute.”
However, it was warned that any move to substitute refined white sugar for plantation white sugar would require closer collaboration between producers and manufacturers.
“As such some capacity should be developed to monitor what happens within the trade, including data collection on quality issues that may arise and as necessary address corrective action.”
The study was funded by the Caribbean Development Bank.
While there has been no official statement as yet from SAC, Jamaican press reported that implementation can change the tone of a trade dispute among CARICOM producers.
According to the Jamaican Gleaner, interest groups came away from a series of meetings in Belize, where the report was presented, saying the talks from October 2-4 made more progress in the past week than in the past several years in resolving the long-running stand-off between sugar producers and manufacturers over the quality of white sugar, also called plantation white.
The two sides are fighting over the high volumes of refined sugar being imported into the region to the disadvantage of regional producers of plantation white.
“It’s the best progress we have made in years,” said Karl James, chairman of the Sugar Association of the Caribbean, SAC.
Providing an update on the discussions, James said there were also presentations on the long-standing use of plantation white sugar by large companies, including soft drink makers Coca-Cola and PepsiCo and food and drink manufacturing conglomerate Nestlé.
The report is a win for Belize, which is the leading producer of plantation white sugar, accounting for nearly all of the region’s output; and potentially for Guyana, which is said to be advanced with plans to start producing plantation white.
With the question answered by empirical study, the region’s ministers of agriculture and trade have agreed to forward a number of recommendations for agreement and policy changes at the next meeting of CARICOM Council for Trade and Economic Development in November.
The main proposed policy change is central to a lobby effort mounted by the SAC running several years and involves the imposition of the existing 40 per cent common external tariff, CET, on all sugar – brown, refined and plantation white – entering CARICOM markets from outside the regional grouping.
Jamaica and Barbados are the other CARICOM sugar-producing territories.
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