Sugar Technology
On-line News

October 2004

Welcome to our news page!

We try to bring you the latest news and comment on this page but it will always be a better place if you send us your news. You can write to us by clicking on the E-mail link at the left.

The news of the month has to be that the raws price broke through the US 9 / lb barrier in September. Other news is more mundane [except perhaps the “Sugar Lump in the Milky Way “ …].



We warned you in June about the Murray and Robert's imminent sale of BT to the [relatively small] South African sugar group TSB. After that, all went quiet and it still is quiet on wires. However, we understand that the deal was finalised on October 8 2004 [even though the Booker Tate web site still says BT "is a Murray and Roberts group company". We will let you know when the new TSB man arrives in Thame.

At the time of the original news item we also speculated that the purchase might make sense for TSB as it had been trying to establish a new estate in Angola. We now understand that it is no longer interested in that project but that it has made a comitment to another project further north : watch this space!


The month ended with the raw sugar price at US 9.06 / lb but one is not sure how long it will stay there. Clearly, the first ISO forecast for the 2004/5 year has much to do with the jump. For the first time in many years that organisation, based in London, is predicting a significant shortfall in production : "After a season of a small statistical deficit, the world sugar economy is facing a season of a much more significant production shortfall”. It sees enhanced production in Brazil, China and Australia but a second year of deficit in India.

The ISO world production forecast [last year’s figures in brackets] is 145 [144] million tons and the consumption forecast is 148 [145] million tons. By September 2005 the stock/consumption ratio is expected to fall to 41 % from a record high of 47 % in 2002/03.


As indicated above, this year’s crop [which has just started] is expected to be lower than last year’s. The year ended September 2003 was a record crop of about 20 million tons but the year just finished is reported to be only 13.5 million [down even further than a recent estimnate] and the year to end September 05 is estimated at only 12.5 million.


As one might expect the stories of the EU Sugar Regime reform and the WTO finding against that regime continued to reverberate, particularly as the northern summer’s silly season truly ended and everyone got down to work again. The new Agriculture Commissioner [strictly still ‘designate’, the change is only officially from November but Franz Fischler is not heard from or of any more], Mariann Fischer Boel, has said that sugar will be her ‘immediate top priority’. She also sold her shares in Danisco [a Danish sugar company] in order to avoid a possible conflict in interest.


Despite being brushed by two hurricanes [F and J] last month, it looks as if there is little real damage to the Florida cane crop. Hurricane I also looked as if it would go for Florida too but it changed course and went up the Gulf to brush Louisiana instead. The USDA estimated that the national crop estimate should be dropped a bit further as a result. The current cane forecast [last year’s figures in brackets] is 28.6 [30.8] million tons cane, including Hawaii.

Weather has also been affecting the beet crop and the crop start was delayed by about 2 weeks due to a lack of maturity. The beet crop forecast is 28.5 [30.6] million tons beet.


Whilst hurricanes ‘F’ and ‘J’ targeted Florida, hurricane ‘I’ swept Jamaica before proceeding up the Gulf to the Louisiana industry. Luckily the eye passed south of the island but there was still serious damage and some deaths. Initial estimates of the impact on the sugar crop were placed at 35% damaged with a sugar reduction of 30,000 tons [15% loss], a loss that the country can ill afford.


Following our June 2004 news item about Illovo selling its Gledhow sugar mill, the company has now announced that it has entered into negotiations to dispose of its Umfulozi mill. One’s memory is not what it was but it cannot be too long ago that it bought Umfulozi from the co-operative that previously owned it. There is no news yet as to who the purchaser might be but it would be no surprise if it was another black empowerment group.


Hippo Valley has admitted that it expects a 10% reduction in output this year [its crop typically runs from March until December] as a result of poor cane delivered by ‘third parties’. The problems seem to result from an inability to control the firing of the cane properly and an excessive ‘burn to crush’ time.

Meanwhile, the government has now gazetted Mkwasine Estate for acquisition as land for settlement of the so called veterans. Mkwasine is an 11,500 ha estate at th eastern end of the lowveldt which is jointly owned by Hippo and Triangle, each factory taking some of the cane.


The Kenyan government has announced that it is planning the development of cane agriculture in the Tana river delta, north of Mombasa. Funding is apparently coming from Spain. The industry is supposed to be based on a ‘hybrid cane’ which matures in only eight months.


Now that the Philippines has a surplus of sugar production [after many years of importing] and with its near neighbour already taking the plunge, the government seems to be serious about a power ethanol project. As crude oil has now passed the US$ 50/ barrel mark we may see the initiative accelerated.

We also hear that the new San Antonio factory on Panay has received all its permits and that work has started on site.


The Ghanaian government is claiming that a team of South African investors is prepared to invest US$ 100 million in a sugar project in the upper Volta valley. As usual, one has to wonder how accurate the speech [to the voters] was.


Last month we carried a short article about Caroni [as was] making a profit. It now seems that the new company has not yet paid the farmers the final payments for the cane delivered to the factory. I suppose that is one way of making a profit.


Nothing really to do with sucrose but scientists have detected a cloud of frozen glycolaldehyde molecules near the centre of our galaxy. Glycolaldehyde is a C2 monosaccharide which could be one of the building blocks of life and hence a cause of some excitement in the popular press.

Homepage  Return to Current News  Page Top