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Chairman of the SICB Says Sugar Prices Are Where They Should be

McLachlan insists that BSI/ASR is giving back to farmers. During Monday’s press conference McLachlan, who is the company’s Senior Vice President of International Relations, told reporters that the first cane price estimate for the new crop season is nine percent higher than the previous season’s. He says this is as a result of BSI/ASR investment but Chairman of the Sugar Industry Control Board, Marcos Osorio, says otherwise.

Malcolm “Mac” McLachan, VP, International Relations, ASR/BSI: “Our first cane price estimate this year is 9% higher than the cane price estimate last year. Now that’s partly as a result of improved value in the global sugar market but it’s also a direct result of the investments that we’ve made both in reducing the cost of freight through our Big Creek investment and also increasing value of sugar through our direct consumption expansion project. So you know that’s 9% higher than last year’s so this is what we’re giving back to the industry. Our investment is being shared with the farmers and helping to create a more viable industry for them.”

Marcos Osorio, Chairman, Sugar Industry Control Board: “There’s no such thing as giving back. That’s a fair price estimate based on market trends internationally. The price of sugar for 2021 since March has been on the upward in terms of the price. Unfortunately they call it that they sell sugar in futures so last crop’s sugar was sold so farmers couldn’t benefit of the increase of price as of March this year or July onwards but will benefit the farmers for the next crop and that’s why I say they’re not giving back. They have sold sugar in the futures which is of this coming crop which have fetched a higher price and the first price estimate is derived on the basis of what’s the prices on which they are selling and then 91% of that price estimate is paid on first payment. So it simply is telling us that the first price estimate based on the sales in the future are higher than what it was last crop and simply that’s the formula that is agreed. They’re not giving back anything to the farmer. The big question will be let us see at what price the final payment will get to. They’re saying ‘we’re giving back to the farmers.’ They’re not giving back. I would turn that that they’re taking out of their pocket give back to the farmer no. They have contracted sugar at a higher price for the upcoming crop and according to the formula agreed for first payment simply when you apply it to the formula that’s the first price estimate that needs to come to the farmer. They’re not giving back.”