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BSI targets CARICOM market for DC Sugars, faces challenges

On Wednesday the BSI/ASR group hosted the media for a tour of the expansions that have been made to the factory to enhance the production of Direct Consumption Sugars. The work began in September of last year and will see the investment of 22 million dollars. As the work progresses, the factory has begun producing six types of direct consumption sugars. The goal is to produce twenty tons of these high food grade sugars on top of the thirty tons that the mill currently produces each crop. The project was undertaken to help minimize the impact of price cuts on the European Market that became effective last year. Additionally, due to overproduction, sugar prices on the global market are increasingly dropping, and are presently below the production cost of sugar.  Vice President of International Relations, Mac McLachlan told the media that the company’s focus is on the EU market where there is a high demand for DC sugars. Another market of interest is the Caribbean market.  In March 2017, Belize participated in a stakeholder meeting with sugar producers in the region to start work on securing the CARICOM sugar market for CARICOM sugar producers. But for that market to open up, sugar producers need to get some changes made to tariffs put in place by CARICOM nations.

Mac McLachlan VP International of Relation ASR/BSI: At the moment a market of around 350,000 tons of sugar in the CARICOM, 200,000 tons of sugar are imported refined sugar from outside the region. Traditionally and the rationale for that was that nobody in the region was producing high enough quality sugar, all of that raw sugar was being exported to Europe where the price in those days were very high and therefore the CARICOM rules permitted the import of white refined sugar through a series of wavers and suspension agreements that meant it avoided paying the common external Tariff so at the moment brown sugar exports into CARICOM are protected by an common external Tariff into the region but it tends to be that white sugar imports are coming Tariff free. What we are trying to do and we are working closely with the government. We are working closely with the governments of Jamaica and Guyana and Barbados as other sugar producers to demonstrate through things like the investment in which we are making here that we are now in a position to provide adequate sugar at the right quality and the right standards for that market and we are therefore suggesting that it might be time to look again at the Tariff structures in CARICOM to permit us to utilize our sugar in that market; at the moment that 200,000 tons of imported sugar is displacing an opportunity for CARICOM producers of Sugar. We appreciate that we need to look at this in a win win scenario for not only sugar producers but also the industrial users of sugar and also those who consume sugar products.

Since March the region’s sugar producers have commissioned a number of reports to illustrate the benefits for the changes.