– Boyer says investments must be made to secure regional markets

By Navendra Seoraj
REVITALISING the sugar industry will be no easy task for local authorities, but the industry, which has been financially challenged for years, has attracted the attention of two companies from India.

The Guyana Chronicle was reliably informed that the two companies have signalled a firm interest to invest in the local sugar industry.
A senior source from the Guyana Sugar Corporation (GuySuCo), while not naming those companies, said they have a wealth of experience in the management and sale of sugar.
Their expertise and skills are anticipated because in India, the sugar industry is the second largest agro-based industry. It is said that sugarcane is an important commercial crop there and it occupies five million hectares. It also contributes significantly to the socio-economic development of that nation.

Like India, Guyana, in the past, had depended heavily on revenue from sugar, which was one of the country’s largest income earners until it started ‘drowning’ in debt. The industry became insolvent mainly because the cost of production was higher than the market price for the commodity.

It was reported in the past that GuySuCo produces sugar at an average cost of US$0.35 per pound while world market prices have averaged US$0.16 per pound.
Although the sugar industry has been considered a liability for years, the new People’s Progressive Party Civic (PPP/C) administration is hoping to “lift the industry from the ashes”.
In 2017, the APNU+AFC Coalition Government had announced the closure of several sugar estates across the country, leaving thousands of persons without a job or source of income. The move saw four sugar estates being closed and 7,000 sugar workers losing their jobs.

INNOVATION AND PRUDENT MANAGEMENT
The new government; however, plans to re-open those shuttered estates and simultaneously rejuvenate the industry through ‘innovation’ and ‘prudent’ management and interventions which could also come from the private sector.

“We alone as a government cannot do it and that is why we are looking at the private sector to help sustain sugar,” Minister of Agriculture, Zulfikar Mustapha, had told Stabroek News.
A number of private investors have already expressed an interest in sugar, said Minister Mustapha, in a recent report.
These private investors are expected to work collaboratively with the government to rebuild the sugar industry.

Chairman of the Private Sector Commission (PSC), Nicholas Boyer, when asked about local interest in the sector, said the commission has not started official discussions on the topic, but members are hoping to meet soon with GuySuCo’s Chief Executive Officer (CEO), Sasenarine Singh.

Boyer told the Guyana Chronicle that the sugar industry has been a ‘staple’ for Guyana and there is new impetus from Singh.
Singh had said GuySuCo is banking on value-added to help return sugar to profitability, and every effort is being made to rebuild the ‘destroyed’ industry, brick by brick.
“GuySuCo is making money on the packaged sugar and losing on the bulk sugar, so we are moving away from the bulk sugar and focusing on the value-added products. We are building a short-term, medium-term and long-term plan; we are supplementing what Blairmont is producing. Blairmont is now focused exclusively on the export market for packaged sugar while Enmore will focus on the local market,” the acting CEO said.

INVESTMENT
Sugar, Boyer said, has not lost its taste.
“There is a market for sugar in the Caribbean and we need to be able to make the investment to meet that demand… it is feasible in the long run but we need to change the methods of harvesting and reduce the cost of production because there is a demand for sugar.”
The Government of Guyana has already released $3B to the industry, of which $2.2B will be used for the re-opening of the three estates and the remaining $0.8B will be used to re-capitalise the current assets to help achieve outlined objectives.

It was reported that the Rose Hall Estate will be the first of the three estates to be re-opened and is expected to begin grinding in 2022.
Singh had said a full business plan for the industry is being crafted, and is expected to be presented to the corporation’s board of directors in October.
Once the business plan is completed, the corporation will start implementing aspects of it ‘minutely’.

“I think the challenge in dealing with a complex situation like what we found at GuySuCo is, there are many plans, there are many feasibility studies, but where they failed all the time was at the point of implementation so that is where I’m going to pay very focused attention.”

“I want to make sure that the implementation is done because it is driving two factors: one is we want to push the revenue proposition up the ladder to be selling at the right price point and the right kind of products, not selling raw sugar but mostly selling things like packaged sugar and bag sugar and hopefully in the medium-term going into a refinery,” said Singh.
The other thing he plans to focus on is the entire value chain within GuySuCo and to establish where the non-value-added activities are then weed them out.