Annual sugar production target further reduced as output slides

Last Updated on Tuesday, 5 December 2017, 13:27 by Denis Chabrol

Government on Tuesday appeared to further reduce the annual production target of a scaled down Guyana Sugar Corporation.

Minister of Agriculture, Noel Holder told the National Assembly that government was now targeting sugar production of 145,247 tonnes in 2020. When government last year had tabled its White Paper on the sugar industry, it had set itself a target of 174,000 annually.

However, Holder said in his contribution to the 2018 National Budget debate that with improvements in productivity, cane yields are expected to rise from the current levels of 55 tonnes cane per hectare to 78.43 tonnes cane per hectare in 2018, a 41 percent increase.

Holder said the improvement in yields would see the three remaining estates attaining close to their productivity potential. He forecasts that  production will rise from 115,447 tonnes of sugar in 2018 to 145,247 tonnes in 2020, an increase of 26 percent.

Government has said that sugar production in 2017 was projected to decline to 152,000 tonnes in 2017, a 17.2 percent reduction compared to 2016’s output of 188,000 tonnes.

“Mr. Speaker, the country’s framework for governing the sugar industry has to evolve. It must become more in tune with reducing vulnerabilities, resolving institutional and legacy issues and diversifying away from sugar to more sustainable industries,” the Agriculture Minister said.

Holder said Guysuco needs GY$12 billion over the next three years – 2018 to 2020- to ensure that production targets are met.

He noted that since winning the May 2015 general election, the APNU+AFC-coalition led government has supported GuySuCo with GY$32 billion, a $6.3 Billion allocation in 2018 and another $2.3 Billion estimated for 2019.

“Mr. Speaker, despite the magnitude of subsidies there has been no positive impact on the financial state of Guysuco.  The economy simply cannot afford this,” he added.

Guysuco has begun steps to sell out Skeldon, Rose Hall- Canje and Enmore operations and diversify Wales is scheduled for diversification.

Projections are that at Uitvlugt cane farmers will account for over 50 percent of the canes supplied to the factory and every effort will be made to increase on this proportion.

Authorities also hope that the the unit costs of production is expected to decrease to 24.5USc/lb sugar (currently over 40USc/lb).There is a number of cost saving initiatives which have been identified to assist in lowering the unit cost of production even further.

Meanwhile, he announced that a European Union-funded study has shown that it is feasible to establish co-generation plants at Albion and Uitvlugt. He said excess power would be sold to the Guyana Power and Light Inc.