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On-line News

April 2009

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The ongoing Florida story - again! ...


By early March the stories about the economic situation stopping Florida from completing the deal to buy USSC’s 187 000 acres were strengthening. It was reported that property values – and hence tax revenues – had already dropped 14% with more to come.

The next event was the start of a court case to determine whether the State can actually issue the $2.2 billion worth of bonds that it wants to issue to fund the deal. The case is being brought by Florida Crystals, the local Indian tribe and some community leaders in Belleglade. Part of the court hearing – which ended without any finding being published and is, in any case, expected to go to higher courts – was a report from an expert commissioned by the opponents that estimates the cost of the full restoration at $9.1 billion.

Finally, at the month end, the entire project changes shape as the State seemed to realise that it couldn’t go through with the project. The rumours were that the deal would be cut back to about $500 million with only 70 000 acres purchased. That probably leaves the way open for Florida Crystals to step in and buy the rest [plus the factory?] and then sell some of its land to the state as well – except that the state couldn’t afford to buy it. Perhaps there will be a land swap of some of the 70 000 acres as the Everglades scheme probably only needs 30 000 acres.


It looks as if the rumours are true : there have been formal announcements made about the proposed new Cargill / Sugar Growers refinery now being sited at Imperial’s Gramercy site, utilising the existing infrastructure. What nobody seems to be addressing is the Sugar Growers’ ability to produce VHP raws acceptable for processing through Cargill’s proposed refinery.

Later in the month, the State approved the issuance of up to $100 million of supported bonds for the project – a very interesting decision in the light of the debacle over the Lacassine factory which was also supported by state funds. Maybe it is because the money behind the bonds is actually federal money intended to help recovery from hurricanes Rita and Katrina.


The Saint Louis refinery in Marseille may have to close temporarily if strikes continue to disrupt the normal business of the port, through which the refinery receives its raws from overseas. The strikes, in protest at government reforms, have been going on for over a month.


ABF, the owner of British Sugar, received regulatory approval of its purchase of Ebro Puleva’s sugar division at the very end of March.


Yet another version of the Aden sugar refinery has been announced, this time by the private sector development arm of the Islamic Development Bank. The refinery is stated to have a capacity of 1 million tons [presumably RSO] but no details of a technical partner have been announced.


For those of you following the story over the last few months, the latest forecast for India’s 2008/9 crop is only 16 million tons, down another 2 million tons from the forecast 2 months ago. This latest forecast is from the millers’ association. The talk now is of how much India will import rather than whether it will but it looks as if it will mainly import raws for local refining.

The data from Maharashtra, the largest producer, tells the story : the expected production this year is 4.7 to 4.8 million tons from 40 to 41 million tons of cane compared to 9.1 million from 76.1 million last year. The total area under cane is reported to be only 787 000 ha compared to about 1 million ha two years ago but that doesn’t account for all of the drop, yields must be down too.


Thailand is reporting a small drop in production with total production standing at 6.94 million tons at March 30, down 5.6% year on year. 38% of the production is white sugar.


The Queensland floods reported last month and caused by Tropical Cyclone Ellie are estimated to have reduced the crop production by 250 000 tons of sugar.


It seems that the stalled financing by India of the Tendaho project may be back on tracks : the Minister of Trade and Industry was in India for talks at the end of March so it is assumed that the internal disputes between the Indian EPC contractor and at least one of his subcontractors has been resolved. Sorting out the mess should also free up funding for the Finchaa and Wonj Shoa expansions.


Another ‘South African’ sugar project in Nigeria has been announced : this time in Gombe state. The project, said to involve 40 000 ha of cane, is supposed to be developed by Wise Design International according to the company CEO, Mr Williams Bawise.


Moçambique is forecasting a 68% increase in this year’s production compared to 2008 : a total of 419 000 tons of sugar. 37 of the 68% is as a result of increased planted area as various expansion projects are completed but the rest is reportedly due to increased yields which is a staggering amount, if achieved.


The Jamaican government is claiming that 14 companies, many of them international, have expressed interest in buying SCJ in this new round of trying to privatise the loss making company. Despite trying to sell it as a going concern, the spokesman also said that the government couldn’t afford to keep running the company …..


The Trinidad government has, at very short notice, rescinded its agreed sale of the old Ste Madeleine factory to a cooperative of local farmers [see our December and October issues from 2008]. Instead it will now sell the factory by public auction.


One of Brazil’s biggest sugarcane processors is predicting a sharp rise in sugar production in the country as the depressed real and low ethanol prices again play on the optimisation of the process. The real is 27% lower than it was just seven months ago.


A major development programme has been announced for the Tocantins state of Brazil [due north of São Paulo and 1500 km inland from Recife] : 300 000 ha supplying 12 factories. Drip irrigation is a major component of the scheme, all of which will be provided by Netafim, the world leader in drip technology.


Responding to the publicity given to BP in the previous month, Shell Petroleum announced its own investment in cellulosic ethanol last month : it has doubled its investment in the Californian enzyme house Codexis. Its original investment was in late 2007 but we are not aware of any demonstration plant for the particular technology.


A press report about Virent Energy Systems states that the company will build a 10 000 gallons per annum [just under 38 000 ℓ/a] pilot plant to produce a hydrocarbon liquid fuel from renewable sugars [presumably starch based as much as sucrose]. The process is reported to be platinum catalysed.


US research scientists have announced a hybrid plant that seems to be a type of maize which stores energy as sugar(s) and uses less nitrogen fertiliser to grow. The downside is that it produces less seed than conventional maize. The creators of the hybrid see it as an alternative to sweet sorghum.

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