Sugar Technology
On-line News

May 2007

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April, but no earth shattering news ...


LOUISIANA

Following our question in the March News Page, it seems that Cargill’s partners for the proposed new Mississippi refinery not far from the existing Gramercy have now managed to put all of the funding in place and it will go ahead. The refinery is planned to be a twin of the Cargill unit currently under construction in Syria so will have a capacity of 1 million tons per annum.

It looks as if another of Louisiana’s sugar cooperatives is in trouble : the workforce at St James was laid off for a week in late April because the company “couldn’t be sure that the mill would be able to pay its roughly 75 workers”. St James is part of a group which has already shut several of its mills.

ACP

The African, Caribbean and Pacific group held its 10th Sugar Ministers meeting in Fiji last month, despite the country recently being the subject of a military coup. As is usual with such meetings, many news articles were generated but not too much substance. The ACP is urgently trying to avoid a total collapse of the sugar protocol that gives it preferential access to Europe despite some of its members shutting down their industries for good.

During the meeting it also emerged that Fiji will have its EU support for changes to the local industry cut back as a result of the coup.

EU TO INCREASE INCENTIVES TO QUIT?

It looks as if the EU may increase its compensation scheme for those prepared to stop producing sugar in the 27 countries. Only 50% of the EU’s 1.2 million ton target has actually been closed so it is beginning to realise that the incentives are not adequate. The details of the scheme should have become clear by the time that you read this.

NITROGEN EFFICIENT SUGAR BEET

A European seed company has signed a license agreement with a Californian company that develops commercial plant varieties that are more efficient at using applied nitrogen fertilisers. Their joint aim is to develop sugar beet varieties that require less fertiliser to deliver the same amount of sucrose. As the Californian company, Arcadia Biosciences, uses both transgenic technology and conventional breeding it is not clear whether the resulting crops will be transgenic or not.

INDIA

The latest crop forecasts for India make astounding reading when you remember that just a year or so ago the crop was down at about 12 million tons of sugar during a drought. This year [to September 30 2007] is forecast to produce about 27.5 million tons and the following year nearly 29 million tons. The current crop must be a major component of the 8.5 million global surplus now being predicted by ISO. No wonder that the world price had dipped to just 10 /lb by the end of the month.

As predicted last month, the government is now offering a $35/ton export incentive. India was hoping that Pakistan would buy some of its surplus and started the month suggesting the sale of about 300,000 tons. However the quick response from the Pakistan industry was that it didn’t want to have ‘unhygienic’ Indian sugar coming into the country. It also pointed out that there were strategic reserves of 600,000 [skipping the fact that that is only 2 month’s demand] and that the next year’s crop was predicted to be about half a million tons in surplus.

MEXICO

The government of Mexico has launched a ‘National Sugar Cane Agribusiness Program’ to boost the industry in the light of competition from the USA. The US had better look out as the report that we saw called for 840 million tons of sugar [sic] to be exported by 2012.

AUSTRALIA

There has not been much additional news about the bidding war for the northern Queensland factory at Mulgrave. However, one of the bidders - Maryborough Sugar – did substantially downgrade its profit forecast. As the downgrade was by 50% and only two months after the previous forecast would you want the management to take over your mill?

SUCRERIE DE BOURBON SELLS OUT

Sucrerie de Bourbon has announced the sale of its Tay Ninh factory in Vietnam, marking the start of its departure from the sugar industry. As it was only formed in post-war Reunion it will be a sad time for many old sugar hands. At this stage it is selling 49% of Tay Ninh [24% already placed, 20% to be offered by auction on the Ho-Chi-Minh City Stock Exchange and 5% to the employees and growers] and is committed to holding the balance for at least three years.

NEW FACTORY ON SUMATRA

The provincial government has started a $40 million project to build a new cane sugar factory [not a refinery as reported by some] at Padang on the central west coast of Sumatra. The first year’s production is expected to be 75,000 tons of sugar.

EU NOT ‘ROUNDUP READY’

An EU technical committee failed to reach consensus on an application for approval of a transgenic ‘Roundup Ready’ beet variety last month. Apparently that means that control passes to meeting of Ministers of the 27 countries so who knows what decision will be taken.





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