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May was a mixed bag ....
ISO PREDICTS SHORTAGE
The ISO is predicting a 1 to 2 million ton deficit in sugar for 2008/9 compared to a surplus of 7.8 million tons in 2007/8. The change is due in part to a forecast 4 million ton increase in annual consumption [to 165 million tons]. Presumably the balance is due to more sucrose being diverted to ethanol rather than a real drop in agricultural production.
FIRE AT HULETT REFINERY
An early morning fire on May 9 in the raw sugar stores at the Tongaat Hulett refinery in Durban has disrupted operations there. Two of the three stores were destroyed and the third was partially damaged. 4 000 tons of raws were also lost but no injuries have been reported. The government’s Department of Labour instructed the company to cease operations pending submission of a certificate of electrical compliance.
Spain’s Ebro Puleva group has announced plans to sell or float off its sugar business. Given that beet cultivation is sub-economic in Spain’s climate, one has to question who would want to buy or invest in anything other than the marketing operation.
SWEDEN TO RUN ON AFRICAN ETHANOL?
A Swedish ethanol company called SEKAB has announced plans to develop large scale cane ethanol plants in Tanzania and Mozambique. The long term objective is said to be to export ‘several billion litres of ethanol’ annually from 400 000 ha of estates within 20 years. The company plans to have the first facilities operational by 2011.
The Cargill refinery at Homs that we reported as operational in March has now been officially opened by the Prime Minister. Meanwhile, we hear that Tarif Akras is still pressing ahead with his refinery near Homs : will the market bear that much capacity?
Even though it has not yet reached full capacity, Savola has announced plans to increase capacity at its new Ain Sokhna refinery on the Red Sea coast of Egypt. The initial target capacity is 750 000 t/a RSO with the expansion designed to take it to 950 000.
More details have also emerged about the company’s planned beet factory in the Delta that we told you about last month : it will produce 200 000 t/a of sugar when complete and is expected to cost $150 million. It is understood that at least part of the factory will be assembled from second hand European beet factory equipment.
Development of the new Tendaho factory [planned for the far north east, close to Djibouti and hence the export markets] seems to be delayed by what is supposed to be a consortium of Indian contractors [the project has Indian EXIM bank support]. Work should have started 5 months ago – but has not – so the Ministry of Trade and Industry has issued an instruction to commence work : watch this space.
The Tongaat Hulett annual report shows that, not surprisingly, production fell significantly in the low veldt last year. Triangle’s production was 193 000 tons [240 000 the previous year] and Hippo’s only 156 000. The combined production of 349 000 tons does not compare well with the declared capacity of 600 000. Most of the problems seem to be due to a shortage of cane, presumably due to the forced eviction of the original cane farmers.
FIJI SECURES 300 000 TONS
Tate & Lyle has announced a 300 000 t/a raw sugar medium term purchase agreement with Fiji. It will presumably take over when the ACP agreement runs out next year and will last until September 2015.
USA BEET DELAYED
The weather in the Red River valley has been colder than normal this year so the seeds are not even sown yet when normally they would already be sprouting. Of course that doesn’t necessarily mean that the crop itself will be impacted, it is just a warning sign. Things have been no better in Nebraska where 40% of the crop had to be re-sown, after which high winds ruined 11 to 12% of it too late to sow yet again.
Cane based energy – ethanol and co-generation combined – overtook hydroelectric energy in Brazil last year : 16% of total energy compared to 14.6%. In part this was due to substantial increases in both hydrous ethanol consumption [up 46% to 10.4 billion litres] and anhydrous ethanol consumption [up almost 20% to 6.2 billion litres].
Meanwhile, Sao Paulo state has suspended the licensing of any more cane development pending an environmental impact assessment.
AMERICAN CRYSTAL TESTING DIGESTER
American Crystal is setting up a pilot scale anaerobic digester at one of its beet factories in North Dakota to handle the beet tailings [the trimmings removed before processing]. Preliminary numbers are said to show an energy saving of $10 million per year from the methane produced. However, what the company has not said is what it will digest when not slicing.
HOME GROWN ETHANOL
A start-up company in the USA is offering a domestic fuel ethanol machine under the ‘Microfueler’ trade name, to be available in the last quarter of this year. In theory you connect it to the power and water supplies, fill it with sugar and yeast and forget it : a week later it delivers fuel ethanol from its regular tank filling hose …. You can find out more at the company's web domain.