Sugar Technology
On-line News

January 2012

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The funny season again; very little news :


The world price spent last month drifting idly between 23 and 24 US¢/lb. Most analysts are saying that it will decline a bit further – maybe down to 22 – but they don’t believe it will go lower despite the expected 6? million ton surplus in the current year [but see what they are saying about India below].


The French forecast for the current European crop is 18.25 million tons which could well result in greater stockpiles but as the union ended the previous year with only 1.2 million tons that cannot be a serious problem. The same forecast predicts that output from just Germany, France and the UK will be up by 2.25 million tons, albeit from a disastrous previous year.


Another study has been issued showing that the sugar beet industry should be re-established in Ireland. This one assumes a crop of 1.2 million tons of beet producing 154 000 tons of crystal plus bioethanol. The plant would continue to operate after the campaign, producing bioethanol from grain. It is unclear whether it would also operate on thick juice during that time.

The capital cost is reported to be € 350 million and the project was assumed to have a debt : equity ratio of 70 : 30 so an investment of € 105 million is required.


At least one trader [Kingsman] has started to mark down its estimate for the current Indian crop. A delayed start in Maharashtra coupled with lower yields throughout were cited as the forecast was reduced by 500 000 tons to 25.5 million. The company is forecasting Indian consumption at 22.5 million tons so the mathematical 3 million surplus is only 1½ month’s supply.


The curtain finally came down on the Proserpine saga in early December when Wilmar’s Sucrogen secured the company with a headline price of Aus$ 120 million. The difference this time round was that, with the company in administration, the decision lay with the creditors not the shareholders. The competing offer from Tully was not even considered despite the higher headline price because Sucrogen had some form of exclusivity.

Completion means that Sucrogen now owns 8 of Australia’s 24 sugar factories and 17 million tons of capacity compared to the country total of 28 million.

The next saga will be Mitr Phol’s takeover of Maryborough [although, hopefully, it will not be a long saga] which would then just leave Mackay independent : watch this space!


Imperial Sugar has sold its one third share of the new Louisiana Sugar Refinery at Gramercy for just $18 million. It is unclear what the sale includes as the refinery was planned on the basis that it would get its steam and electricity from the old Gramercy refinery power station and that the sugar would be packed in the old Gramercy refinery packing house.


Exactly two years ago we reported that the Procana project planned for the Masingir district of southern Moçambique [it is just across the border from South Africa’s Kruger National Park] had collapsed. We now hear that TSB has decided to adopt the project although we can find no official statement from TSB on the subject.

TSB operates very close to the area on the South African side of the border so it makes sense for it to expand into Moçambique. There is talk in that country that the project – still focused on bioethanol – will use 30 000 ha of land and will require an investment of $740 million.

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