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March 2013

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In some haste this month :


The world price continued to bounce around the 18 ¢/lb range during February but the consensus seems to be that it will start to climb again as people understand that prices are favouring ethanol production in Brazil and at 18 ¢/lb there will be closures around the world.


An important vote takes place in the European Parliament in mid March : whether to extend the sugar regime beyond the current end in 2015. [Not that such a vote would mean much in real terms : the parliament is about as powerful as the English parliament in the days of Henry VIII where the EU Commission plays the part of the king.] What is interesting though is the amount of lobbying going on. One of the titbits was an admittance by ASR that its Thames refinery now only operates a 5 day week and confirmation that last year’s melt was only 600 000 tons. If the vote favours extension then ASR says it will take the EU to court.


A small dust explosion, reportedly arising from a static electricity spark, occurred last month at the Dutch facility of Belgium’s Iscal Sugar. No more information is available.


FranceAgriMer is reporting that the [Oct/Sep] 2012/13 year is not good with production down about 600 000 tons because of the beet crop.


One of the two groups trying to re-establish a beet industry in Ireland was due to reveal its chosen factory site at the end of February. ‘Beet Ireland’ as it is called was due to make the announcement at public meetings and most people seemed to be betting on a soon to be closed mine site in County Tipperary. So far that has not been confirmed.


The government of Kenya has again agreed to write off the debts of the five sugar mills that it owns as a pre-requisite to their privatisation. We seems to be back at the start again, some five years after the last start. The cost of the write-offs is reported to be over US$460 million.


The government of Rwanda has repeated that a ‘group of investors from Mauritius’ is in talks to invest in sugar in the country. We first reported this last October so perhaps there is some truth in it.

Meanwhile, the government has also announced that it is allocating land to a Canadian company to grow Stevia rebaudiana for the production of steviol glycoside.


Tereos is reporting that its Marromeu estate in Moçambique produced 76 000 tons last year, a 15% increase on the previous year. 730 000 tons of cane were crushed despite a drought in the middle of the crop. In practice the drought probably helped to achieve the high yield.


The Mauritian government has announced that sugar production on the island slumped to just 409 000 tons last year. It seems resigned to a permanent decline in annual production which used to easily exceed 600 000.


There seems to be a serious problem brewing between Mitr Phol and Khon Kaen with the Department of Industrial Works refusing to let either company start their new factories in the far north east province of Loei [had up against the border with Laos] because they are less than the 80 km apart required by law. As is usually the case in Thailand, both companies jumped the gun in terms of building before their licence was issued.


ABF Sugar, the owner of British Sugar, has announced that it will be mothballing two of its beet factories in northern China. The statement blames the slump in the world sugar price.


BWE seems to have been particularly badly hit by the extensive flooding we reported last month. It will probably be several months before the workshops are fully operational again.

The sugar factory was also severely hit and it seems that parts of the cane transport rail system was washed away. We also hear that the port at Bundaberg will have to be dredged before it can again be used for exports.


The American Crystal lock-out seems likely to last more than two years as workers from North Dakota have been granted unemployment benefit by that state’s Supreme Court despite a law which prohibits such payments to workers involved in ‘labor disputes’. The lock-out started in August 2011.


It is just over five years since the fatal explosions at Imperial’s Savannah refinery and the US government has now announced that there will be no criminal prosecutions as a result of the event. That still leaves the company, its executives and its risk assessment advisors open to private law suits.


As the island started its crop last month, Azcuba - the new Cuban entity - was bravely forecasting a 20% increase in production over last year at 1.7 million tons. It did temper the forecast, however, by saying that some mills started late and that the mean throughput to date was only 92% of budget.


The Sugar Producers Committee of Nicaragua is claiming that $60 million will be invested on electrical export projects at various of the country’s mills to add 150 MW of capacity by 2015. That is only 20% of the typical cost of such a project so something doesn’t stack up.


Brazil’s centre south is expected to have a record crop of about 580 million tons of cane. The challenge will be to crush it all with some experts already forecasting standing cane at the end of crop even though some mills are expected to open up to three weeks early.

What seems much less easy to call is the crystal sugar to ethanol split with some people seeing crystal output little different from last year as ethanol is favoured for economic and port congestion reasons.


Research workers at London’s King’s College think that they may have a new and painless inoculation method that also overcomes the need for refrigerated storage. The technique is a modified ‘patch’ such as is used to help people wean themselves off of nicotine or to reduce the symptoms of sea sickness. First they co-dried the vaccine with a sugar solution to form what are presumably monoclinic needles of crystalline sugar and then fixed them to the patch. In theory the needles penetrate the skin, instantly dissolve and hence deliver the vaccine.

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