–shift will eliminate industry’s dependence on national treasury
COGNISANT of the fact that a diversion from the traditional bulk production of sugar is needed if the ailing industry is to recover and regain its vitality and position as a contributor to economic growth, the government has initiated plans to ensure that by 2025, 61 per cent of industry sales come from value-added products.
Instead of being a liability to the National Treasury, the industry will soon be able to “stand on its own,” through the implementation of innovative mechanisms, Minister of Agriculture, Zulfikar Mustapha, has said. “In 2020, some 29 per cent of the industry’s sales were from the higher value packaged sugar. In 2021, we anticipate this will grow to some 39 per cent,” Minister Mustapha said, during his presentation on day two of the budget debates.
The overarching plan, however, is to ensure that a minimum of 61 per cent of the sales from the industry are generated from the value-added, packaged sugar line in four years.
“To realise this potential, significant investments have been planned to expand the Blairmont packaging plant, quadrupling its current capacity. Moreover, we will be re-tooling the Enmore Packaging Plant, to support the paradigm shift to packaged sugar,” Minister Mustapha said.
As a result of those strategic actions, the sugar industry will be less dependent on the National Treasury. In 2020, the corporation was allocated a sum of $7 billion. A sum of $3 billion was used to recapitalise the shuttered Rose Hall, Skeldon, and Enmore Sugar Estates, while the remaining $4 billion was allocated to support rehabilitation works at the Uitvlugt, Blairmont and Albion Sugar Estates. A further $2 billion has been set aside in Budget 2021 for capital works to be carried out at the various sugar estates across the country. Those investments are expected to pave the way for the execution of a strategic plan developed by the board and management of the Guyana Sugar Corporation (GuySuCo).
“In 2021, the plan is to expand and further develop feasibility studies which support GuySuCo’s value-added potentials including but not limited to ethanol and agro-energy,” Minister Mustapha said.
The corporation has since set a target to produce approximately 97,420 metric tonnes of sugar by year-end and breathe new life into the country’s sugar industry.
Ahead of what is expected to be a productive year for the industry, GuySuCo has secured an increase of US$30 per metric tonne for sugar from Trinidad and Tobago and has signed a one-year agreement with Demerara Distillers Limited (DDL), which offers a much higher price for molasses.
“We are grateful for the partnership that DDL is bringing to GuySuCo to make sure that more value is being brought to our table; secondly, we were able to secure US$30 per metric tonne in our Trinidad market, our biggest market,” Chief Executive Officer of GuySuCo, Sasenarine Singh said during a recent press briefing.
The vision of GuySuCo, as outlined by the company’s management, is to focus on expanding the sale of packaged sugar in CARICOM, North America and the local markets.
“We have been able to expand our St. Vincent market; we have started negotiations with Grenada to restart reselling packaged sugar and bag sugar to the Grenada market. “Our mantra going forward as an industry is very simple; we want to produce what we can sell for the most possible cash; we are not excited about selling raw bulk sugar in the market, it’s an afterthought. If it happens, it happens because we have no other alternative. Our primary market going forward will remain packaged valued-added sugar, Demerara Gold and the Enmore Crystals,” Singh said.