Sugar Technology
On-line News

December 2003

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.

No improvement in the sugar price - although we are back above 6 ¢ per lb - and the crop forecasts which were a feature of last month's wires imply that it is going to stay low.

SERBIA

The EU ban on sugar imports from Serbia seems to be biting with recriminations flying about who knew what in Serbia. The country's Anti-Corruption Council has apparently stated that the government knew about the scam following a warning from the EU but did nothing to stop it. What must be perhaps most galling is that the country is forecasting a total production this year of 250,000 tons, some 30,000 more than the demand in the country.

CUBA

The new crop started last month in Cuba, an event that was accompanied by a declaration that the crop would produce 2.6 to 2.7 million tons of sugar. The government has still not released last year's actual production figures but the general view is that it was little more than 2 million tons so an increase of about 30% will be required to deliver the new crop's forecast.

PHILIPPINES TO EXPORT

The Philippines is forecasting production to exceed 2.2 million tons in the current year, marginally up from last year and still well above self-sufficiency. The Sugar Regulatory Administration is therefore expecting to export 80,000 tons of world price sugar, the first time that the country has done so in over a decade.

VICTORIAS ABANDONS COGENERATION PLAN

Also in the Philippines, VMC has finally decided not to proceed with the joint venture co-generation project proposed by Bronzeoak Ltd of the UK. Instead, the company is saying that it wishes to proceed with its own 50MW station. Perhaps now that it has escaped from clutches of total bankruptcy the company feels more able to undertake such a project without external finance?

TONGAAT-HULETT TO CLOSE ENTUMENI

It looks as if Tongaat-Hulett is finally going to close Entumeni, a tiny factory which has never really fitted into the group. To put it into perspective : Entumeni probably crushes less than half a million tons of cane a year whereas the group as a whole crushes about 9 million and there is spare capacity at the other TH mills in South Africa. The group will probably make more money by not operating mill even after paying the extra transport cost of the cane.

BELIZE : HYDROELECTRIC vs COGENERATION

There could be an interesting debate developing in Belize as the Privy Council [the advisors to HM Queen Elizabeth] is asked to decide whether Belize should be allowed to develop a new dam. Environmentalists are arguing that the dam will do more damage than operating a bagasse fired co-generation station. Tower Hill has long been a prime candidate for co-generation because its cane fibre content is so high [~17% from memory].

AMERICAN FREE TRADE AGREEMENTS

With the sweeteners dispute between Mexico and the USA still unresolved [we received several comments about last month's reported breakthrough, saying that there never would be a resolution despite the views expressed], the USA is still pressing ahead with discussions on the formation of the Central America Free Trade Area and the Free Trade Area of the Americas. Both were much in the news last month with agriculture and therefore sugar to the fore. Argentina apparently suggested compensation for the $20 billion farm subsidies but this was flatly rejected by the US in FTAA talks. In the CAFTA talks there were rumours that the US would exclude sugar from the discussions [perhaps after the debacle with the Mexico deal on sugar?] but later in the month this was denied.

LATEST FDA FORECASTS AVAILABLE

The latest USFDA sugar supply forecasts are available at the FDA web site : http://www.fas.usda.gov/psd/complete_tables/HTP-table10-91.htm. The FDA's general site for sugar is http://www.fas.usda.gov/htp/sugar/sugar.html.

The figures do not make good reading with the production forecast increased by about 6 million tons to 144.5 million. The demand forecast on the other hand has only increased marginally to 139.3 million. Most of the supply side increase seems to be from Brazil and India.

SMOOTH ROOT BEETS

The USDA's Agricultural Research Service has released two new promising breeding lines of smooth rooted sugar beets for final commercial development. Beets typically have a crease in the root which holds soil and makes the beet harder to clean at the start of the process. Early results of the research program had beets with low sugar content but these new beets contain about 17% sucrose, not far short of the current commercial varieties.

CHINA DOWNGRADES FORECAST

Earlier this year China was forecasting a record crop for this year : 11 million tons or 3.3% higher than last year. The government is now saying that the crop will only be about 9.9 million tons due to poor rainfall in the cane areas and a reduced beet acreage. The shortfall will be compensated by increased imports [rather than reduced 'demand' as has been the case in the past.]

EU PREPARES FOR ACCESSION

The EU has stopped export subsidies for sugar going to the 10 countries joining the EU next May in preparation for their formal accession. If it did not do this then it would be possible for traders to make super-profits by sending sugar into the countries now and then storing it pending the price rises which will take place as the EU sugar regime starts to apply there.

BRAZIL TO EXPORT WHITES?

Brazil is again thinking of exporting white sugar intended for the domestic market due to a glut. The last time that the country did this was in 1998/9. If it happens it is likely to depress the sugar price even more and could have an impact on the refiners' margin, currently holding up at about $50 per ton.

AND FINALLY …

It is reported that Wales will try a new molasses based product to keep its roads free from ice this winter. "Ecothaw" seems to be a mix of molasses and salt, the idea being that the salt will do its usual job of de-icing the roads while the molasses will provide stickiness to slow the rate at which the salt disperses. The promoters hope to save 30 to 40% of the salt which would otherwise be required.





Homepage  Return to Current News  Page Top