GuySuCo trims debt by $4B
GuySuCo’s CEO, Errol Hanoman
GuySuCo’s CEO, Errol Hanoman

THE Guyana Sugar Corporation (GUYSUCO) which has suffered severe blows over the last few years has managed to trim its $82B debt by almost $4B in the last month, General Manager Errol Hanoman said. This was disclosed yesterday at the Ministry of Agriculture end-of-year press conference, which was held at in boardroom.
During last month, government had announced a fixed debt of $82B while hinting at a further bailout for the industry in 2016. The issue of repeated strikes was also cited as one of the major setbacks, and government had offered that further strike action could possibly bring sugar to its knees.

Minister of State Joseph Harmon
Minister of State Joseph Harmon

But yesterday, Hanoman told reporters that, as of yesterday, the $82B had been reduced to $78.6B.
Over the years, despite having an insolvent status, GuySuCo has been receiving massive bailouts from the government through the annual national budgets. This year the corporation had received a $12B subsidy from the government as was provided for in the 2015 Budget.
And while this has aided to some extent in the reduction of the debt, Hanoman yesterday disclosed that 100 per cent of this year’s earnings went into salaries for workers.
BITTER-SWEET JOURNEY
Meanwhile, Minister of Agriculture Noel Holder in providing an overview of the performance of the sugar industry for 2015 noted that the journey of the industry remains a bitter-sweet one.
And the success story could be attributed largely to the fact that sugar production for the year which stands at 229,215 tonnes, has surpassed the projected target of 227,443 tonnes. The second crop production is at present 148,372 tonnes as against the latest estimate of 146,300 tonnes.
The minister explained that for the second crop, four estates – Skeldon, Albion, Blairmount and Uitvlugt – exceeded their production targets with the Skeldon factory recording its highest output since its commissioning.
“The Skeldon factory performed creditably during the second crop and the average throughout was 230 tonnes cane per hour, which is a marked improvement from previous levels. Tillage and planting operations are ongoing with most estates expected to achieve the 2nd crop target, which will be beneficial for the 2nd crop of 2016,” Minister Holder said.
And while the average cane harvesting attendance for the industry as at December 11, 2015 was 60.9 per cent compared with 59 per cent for the second crop in 2014, it is anticipated that there will be no canes carried over into the first crop of 2016.
Holder also explained that the World Market Price (WMP) for raw sugar continues to be way below the levels of two to three years ago, and this has impacted negatively on the price Guyana obtained from sugar sales.
“This was very evident from sugar sold to the European market where the price received was very much related to the World Market Price,” he said.
VALUE-ADDED SUGAR
He also reported that sales of value-added sugar increased significantly from 2014 levels and Guyana’s presence was re-established in most of the CARICOM countries. Additionally, sales of Guyana’s latest brand of packaged sugar “Enmore Crystals,” which is aimed at the North American market commenced in 2015 in both the USA and Canada.
“Enmore Crystals” was introduced to these markets after government lost its claim for the world-renowned “Demerara Gold” to Bedessee Imports Ltd – a sugar manufacturing company operating outside of Guyana.
Nevertheless, Minister Holder highlighted that sugar production for 2016 is projected to be at 242,287 tonnes; a five per cent increase over the 2015 production. Grinding operations for the first crop is expected to commence at the end of January.
In a bid to further strengthen the industry, the minister related that the GuySuCo Commission of Inquiry’s (CoI) report into the operations of the sugar industry with recommendations for the way forward for the industry has been received and has been considered by Cabinet. The report is expected to be laid in Parliament on December 31, where it will be considered by the Economic Services Committee.
“While the recommendations of the CoI were many, with many options, it is government’s view that the future of sugar is so important to the fortunes of Guyana, and the Guyanese people, to warrant as much discussion and consideration as possible, in our quest to chart a way forward for the industry,” Holder said.
And while Minister of State Joseph Harmon has noted that recommendations were made for the estates to become more efficient, implementation of the approved recommendations are proposed to commence in 2016.

Minister of Agriculture, Noel Holder
Minister of Agriculture, Noel Holder

At a post-Cabinet press briefing yesterday, Harmon also revealed that even without the CoI’s findings and recommendations, his understanding is that GuySuCo on its own volition has decided to merge some estates.
To this end, he hinted at the estate at Wales and the one at Uitvlugt merging, which will result in the canes from Wales going to Uitvlugt.
And while there are proposals which seek to make the operations of the estates more independent, Harmon offered that those proposals will have to be subjected to wider consultations.
“The whole idea is to make the industry more efficient so that it does not be a drain on the economy to provide large sums of funds every year,” he said.

By Ravin Singh

 

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