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January was a fairly interesting news month and also saw the start of the ISSCT Silver Jubilee Congress in Guatemala – from whence this was compiled.
SKELDON II FINALLY GOES AHEAD
The Skeldon II project was officially launched at the end of last month after several false starts and many delays. Work [presumably engineering] is scheduled to start in six weeks time [mid March] and to be completed by October 2007.
The refinery idea has been dropped but co-generation has been brought back in, having been dropped at an early stage. Once enlarged the estate will consist of 13 000 ha of cane land.
The overall project cost is reported at “over US$100 million” and one key objective is said to be to reduce the production cost of sugar from 16 or 17 US ˘ per pound to 8 ˘.
IRISH SUGAR CLOSES CARLOW
Irish Sugar has announced that it will close its Carlow factory, shrinking down to a single factory at Mallow and halving its work force. We understand that the company will cope by increasing the capacity at Mallow from about 9 to 11 000 tbd and by increasing the campaign from about 90 to 120 days.
The EU submitted its appeal against the WTO sugar finding in mid January. The appeal is short and set in very dry legal terms : WTO document 05-0190. The WTO has stated that it hopes to reply by April 28. The EU appeal was immediately followed by further appeals by the original appellants : Australia, Brazil and Thailand.
There was also an EU Agricultural Ministers’ meeting later in the month attended by Ministers from the ACP and the Least Developed Countries [LDC’s]. The EU continued to reassure the ACP countries that it would try to limit the impact of the proposed reforms to the sugar regime on their economies.
EU ESTIMATE UP
The EU has revised its October 04 estimate for the 2004/5 year upwards by nearly 4% [almost 700 000 tons] to just over 19 million tons. The table below compares the two estimates.
The lion’s share of the increase comes from the two big producers : Germany and France and Germany’s increase is nearly 8%.
Louisiana’s idea for a second syrup mill at Bunkie seems to be in trouble with a row developing between the State Governor and her Agricultural Commissioner. The first mill, Lacassine, is due for commissioning at the start of next crop, i.e. late September 2005. Its syrup will be sent to existing factories on the south / west bank of the Mississippi for processing. The second mill was to be sited as far north of Lafayette as Lacassine is to the west and was to be funded in the same way with State Bonds [paid off by gambling revenue!]. The Governor is not happy with the lack of an adequate feasibility study.
As we indicated last month, a second factory – Jeanerette – has been closed for good, just down the road from New Iberia [see last month].
Amalgamated Sugar has announced that it will not operate its Nyssa factory in Oregon this coming campaign, blaming the closure on over-production. Amalgamated has four factories with a combined annual capacity of 6.5 million tons of beet but its sugar quota, set by the USDA, is the equivalent of only 5.2 million tons.
In Florida, all three groups have announced that they are looking at power ethanol as a solution to a similar quota problem. The real problem though is slops disposal : the industry is already a target of environmentalists with respect to run-off and the Everglades, never mind what to do with the high COD / BOD liquid waste from ethanol plants.
Also in Florida, the strike at Okeelanta which we reported last month collapsed after only four days with the workers accepting a new contract which was less beneficial to them than the one they struck for.
AUSTRALIAN FARMERS STAY PUT
The Australian government has announced that very few sugar cane farmers – 25 to be precise – have taken up the compensation package aimed at reducing the number of farmers and the amount of cane produced.