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The wires in September were dominated by the WTO meeting in Mexico and the lack of progress made. It was difficult to find other news amongst all that.
WTO CANCUN TALKS COLLAPSE
The World Trade Organisation talks in Cancun were specifically aimed at starting what is expected to be a long and difficult process of unwinding the agricultural protection policies of the west but they broke up in disarray and with doomsday talk of the end of the WTO.
MEXICO : USA
The Mexican tariff on HFCS, imposed in retaliation for the US continuing to limit Mexico's access to the US sugar market, is still in place so sales of HFCS have plummeted and sugar supplies have run out. The country is therefore poised to import sugar as prices continue to rise.
The reform of the EU's Common Agricultural Policy took another small step forward in September with June's agreed reforms being ratified by the Agricultural Ministers. There was even official mention of now moving forward to tackle the difficult crops which were excluded from June's agreement : sugar, tobacco, cotton and olive oil. This year's agreement requires all subsidies to be off by 2007 so one can see the sugar regime lasting until at least 2010.
The sugar regime takes about $1.5 billion of the annual EU's budget. Hans Fischler, the EU Commissioner for Agriculture said that there are three scenarios being examined for sugar :
However, he has also been quoted as saying that the status quo is unsustainable. Watch this space!
AUSTRALIA NOT TO EXTEND SUPPORT PACKAGE
The Australian government has announced that it's one year support package for the sugar industry will not be extended despite please from the industry. However, consumers will continue to pay the Au 3 ¢/kg levy for the foreseeable future as the government has only recovered 15% of the money spent in supporting sugar.
MACKAY MAY BUY MAN STAKE IN SUGAR AUSTRALIA
A group of Mackay cane growers is urging Mackay Sugar to reconsider its decision not to buy Man Sugar's share of Sugar Australia [which is up for sale]. The growers have apparently told Mackay that they will even consider putting up some of the cash themselves.
Mumias has had a change of CEO already [the last one was only appointed in June when BT left after 30 years managing the company] with the recent appointment of Evans Kidero, recruited from The Nation news group. The previous incumbent Paul Mutanda, who was the Agricultural Manager at Mumias under BT, was not even mentioned in the announcement even though a new head of agriculture was also announced.
It has become clear that Schaffer did indeed leave Nzoia at the end of August despite various attempts to extend its contract and the company has announced that it has started to repay the Sh 700 million that it owes farmers. However, in the first month it only managed about 3% of that and is already calling for more government aid. Perhaps the nominal repayments were just a political statement.
ADB TO HELP FIJI
It looks as if the Asian Development Bank is going to implement a $25 million programme to help Fiji rationalise its sugar industry. The bank calculates that about one third of the population relies on the sugar industry, a figure which correlates with its contribution to foreign earnings. It may well be that the support will be in finding alternative employment as the ADB comments on the industry itslef were not flattering.
There was an interesting article on the wires last month which gives one an insight into how bad the industry performance is there. The installed capacity is said to be 3.7 million tons of cane at 15 factories but last year only 93 000 tons of sugar was produced. The government is apparently contemplating almost doubling the price it pays for cane to encourage farmers to grow cane.
NEW FACTORY FOR LOUISIANA?
The Agricultural Commissioner for Louisiana is on the move again following the collapse of his plans to build a new factory at Lake Charles some four years ago. The new plan, which already has some approvals - including the important one to raise the $45 million capital by issuing state bonds - would see the creation of a thick syrup mill at Lacassine, slightly east of Lake Charles and just off of I10.
Technically it is probably early days as there was mention of a co-located ethanol plant [without molasses?] and no mention of what would happen to the syrup or the surplus bagasse.
INDIA TO DOUBLE EXPORTS?
India has announced that it is gearing up to double exports. During the year just ended the country exported about 2 million tons so expect to see another 2 million tons on the market in the current year.
DON PEDRO BUYS HPCO
The Philippines' Don Pedro sugar group, which already owns CADP and La Carlotta has purchased the Hawaiian Philippines factory from Jardine Davies with an international group of financiers.
CSR OPTS FOR MORE EXPORT COGENERATION
CSR has announced plans for a new 63 MW export co-generation station at its Pioneer mill. Unfortunately there was little in the way of technical information provided although a budget of Au$100 million [$70 million] was given.
BRAZIL SEQUENCES CANE GENOME
Scientists in Brazil have succeeded in sequencing the genome of sugar cane after four years of work. It is reported that about 2 000 of the more than 33 000 genes are associated with sugar production.