Producers call for CET protection to launch white sugar market | Business

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The Caribbean sugar sector is protected from external competition by a 40 percent tariff on brown sugar imports, and producers want this protection extended to refined sugar as a prerequisite for market development. internal.

In a new position paper released this month, the Caribbean Sugar Association (SAC) said the region lacks the white sugar market and needs new regulations that reward investment in this sector.

Until September 2017, the Caribbean exported around 85% of its sugar production to the European Union. But given the changing market dynamics brought about by the end of preferential access to the EU market, producers are looking to develop new sources of income.

“We recognize the need to develop value-added products to meet demand,” Guyana Sugar Company director Paul Bhim said in a statement released by SAC with the publication of the position paper. “For this reason, Guysuco will invest in the production of white plantation sugars,” Bhim added.

It is estimated that Caricom consumes around 270,000 to 290,000 tonnes of food grade sugars per year.

Belize is already a producer of white plantain sugar, but Jamaica and Guyana are looking for the right incentives to invest in the segment, even as all regional producers grapple with market dynamics on the global stage.

SAC notes that manufacturers in the region face great uncertainty over the future price of sugar due to the myriad of influences on world prices, ranging from the value of the Brazilian real, to speculation in the futures market. by traders, to natural disasters that affect prices, and the dumping of sugar from major producing countries with surplus protected domestic markets.

“They currently pay margins to brokers and other middlemen to secure sugar in the world market and considerable freight and handling costs. They are vulnerable to poor quality of supply, large year-to-year price variations, delivery delays, and high transportation and logistics costs, “SAC said.

In the region, said the SAC, brown sugar is fully protected by the common external tariff, and “it can easily do this for all sugar needs, as producers adapt their production to produce high white and brown sugar. quality ”.

Asked about the paper, Sugar Industry Authority CEO George Callaghan pointed to a recent study that found plantation white sugar to be a good substitute in 98% of manufactured products that now use refined sugars.

Callaghan said the SAC is coordinating efforts to extend the TEC deal to refined sugar, but gave no indication of Jamaican government support for the initiative.

The SAC said Caricom should continue to use a standard for plantation white sugar that is in line with international best practices, but noted that the majority of its members had limited or no capacity to perform such tests, and in rarely asked their national standards bodies. .

However, the Caricom Regional Organization’s Standards Committee for Standards and Quality will make recommendations on a standardized sampling and testing system in the future.

SAC, whose members include Jamaica, Barbados, Belize and Guyana, began consulting with manufacturers and industrial users on a regional refined or white sugar market from last November. The position paper was produced 10 months later, on September 7 of this year.

“We see an exciting future for the region’s sugar market – where Caribbean sugar meets the majority of Caribbean demand,” said SAC President Karl James. “It is time, in the true spirit of the single market, for Caribbean products to contain Caribbean ingredients, in particular sugar, which has been the backbone of many Caricom agro-industries for centuries,” he said. he declares.

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