–as industry rakes in US$10.7M at the end of the first half of 2021
EVEN amid the ongoing restructuring of the Guyana Sugar Corporation (GuySuCo), coupled with its recovery from the country’s most devastating floods, the sugar industry has reaped ‘sweet’ benefits in the first half of the year, earning US$10.7 million.
According to the Ministry of Finance’s Mid-Year Report, the earnings from the industry reflect an increase of some of US$2.8 million when compared to the previous half-year report.
Those notable achievements have added to the overall economic growth recorded during the first half of the year.
The profitability of the sugar industry has also allowed GuySuCo to settle some of its debts. In June, the corporation, according to its Chief Executive Officer (CEO), Sasenarine Singh, was able to facilitate repayments to its trade creditors, to the tune of some $700 million.
Added to that, the sugar company also managed to pay $175 million to the Guyana Agricultural and General Workers’ Union (GAWU), honouring the debts owed to credit unions in the industry.
Further, GuySuCo said that due to its commitment to its 7,400 workers, a strategic plan was crafted to ensure that the $475 million arrears owed to the National Insurance Scheme (NIS) are paid over. As at November 2020, $123 million of that sum was reconciliated.
The sugar company had attributed its positive fiscal standing to a smart and sustainable sales mix aimed at tackling the institution’s long-existing financial woes.
In doing so, GuySuCo took a decision to reduce the sale of its bulk sugar and invest more in selling the packaged product which is in wider demand, and could be sold at a higher cost.
With the switch, the company’s annual losses have plummeted from $2.6 billion to $825 million. This means, that by simply redesigning its marketing and sales strategy, GuySuCo has managed to save approximately $1.7 billion.
“Changing the sales mix is one of our primary short-term strategies, and it has worked,” CEO Singh said at a press conference in July.
He explained then that by having GuySuCo place special emphasis on packaged sugar, the corporation has managed to “unleash some unexploited potential in the revenue stream at very short notice.”
Elaborating on GuySuCo’s savings, the CEO said: “If we sell sugar on a boat, it goes for US$300 to US$350 per metric ton. If we sell the sugar in a bag, it goes for about US$600 a metric ton.”
However, with the packaged sugar, Singh said that Guyana could sell the “Demerara Gold” for as much as US$700 per tonne.
He said that to push the “packaged-sugar” agenda, GuySuCo has restarted operations at the Enmore Packaging Plant, and has moved to further expand production at the Blairmont Packaging Plant.
“…and because of that initiative, GuySuCo has been able to reduce its January to May losses from $2.6B to under a billion this year,” Singh posited.
In yet another effort to be more efficient and sustainable, GuySuCo is also looking to procure equipment necessary for the implementation of a mechanical harvesting system.
“Mechanical harvesters are becoming mandatory,” Singh related.
He said that so far, the average turnout rate for cane-cutters across the six estates is approximately 70 per cent.
“We need a mechanical harvester to do the other 30 per cent of harvesting for us,” the GuySuCo official said.
He said that the industry is also moving ambitiously towards achieving 30 per cent mechanical harvesting by 2025, at least across the Albion, East-Berbice Corentyne, and the Blairmont, West Coast Berbice estates, respectively.
He said that this will not result in the loss of jobs for cane-cutters, since the mechanical harvester would just be filling the existing gap.
“People will move from basic manual labour, to semi-mechanical systems,” Singh envisioned.
He said that the mechanical systems would also allow for the estates to function much better amid unsuitable weather.
In another effort to save even more money, GuySuCo is also looking to diversify its operations and examine the possibility of advancing its renewable-energy initiatives, as recommended by the International Labour Organisation (ILO) in a report which was released recently.
The report examined the socio-economic impact of the closure of four sugar estates by the former A Partnership for National Unity + Alliance For Change government.
In his recommendation, author of the report, Dr. Thomas Singh, pointed to the need for GuySuCo to advance its cellulosic ethanol production as a source of renewable, low-carbon energy that could possibly boost the very profitability of the sugar industry.
“Consideration must also be given to developing a bio-refinery to produce other high-valued chemicals from lignocellulose, both as a strategy for reducing costs, and also for further diversifying the industry,” Dr. Singh noted.
He said that the bio-refineries would make use not only of bagasse, but will also use other kinds of biomass, including rice straw, sawdust, etcetera. This, he related, will also allow for the production of several commercial-scale, high-valued co-products that will enhance the profitability of the core cellulosic ethanol facility.
To this end, the GuySuCo official said that the institution has a diversification committee in place to consider all options. Singh said that the industry has a lot that it has to do, but these have to be done with “a lot of common sense.”