Regional Sugar Producers Call for Policy Changes to Halt Duty-Free Sugar Imports into CARICOM

BELMOPAN, Belize, Friday May 31, 2019 – Regional sugar producers are making an urgent appeal for policy changes to address the large amounts of extra-regional sugar being imported into Caribbean Community (CARICOM) member countries, saying the changes are needed to save thousands of jobs

The appeal was made by members of the Sugar Association of the Caribbean (SAC) at their recent 170th Board of Directors meeting in Belize.

The meeting focused on the future of regional sugar supply, and the SAC noted that 18 months after changes removed market preferences for CARICOM sugar in Europe, regional producers are still looking for solutions within its own regional market. It said sugar industries across the region are investing hundreds of millions of dollars to match quality and supply to regional demand. 

The SAC Board has stated that, currently, more than two-thirds of sugar consumed in CARICOM comes from extra-regional sources, duty-free, displacing market opportunity for over 200,000 metric tonnes of CARICOM sugar, which is forced onto the low-value global market.

The association says policy changes are required to secure the integration of the sugar market within the CARICOM Single Market & Economy (CSME). It says a failure to achieve this threatens a major agricultural sector of the region’s economy, hundreds of thousands of Caribbean jobs, and questions the effectiveness of the single market in meeting its stated objectives. 

CARICOM industries investments are set to deliver to market nearly 300,000 metric tonnes of food-grade sugar within the next 18 months, matching the region’s demand. 

SAC Chairman R. Karl James says the need for change is immediate and urgent.

“SAC Directors are squarely focused on how regional integration can benefit industrial users and consumers of sugar through competitive longer-term pricing strategies, which are not directly impacted by cyclical global sugar price surges,” he said, adding that “the utilization of regional sugar in most of our products would reduce this risk alongside the processing and import costs associated with importing sugar from outside the region”.

“This would bring CARICOM in line with other regional sugar markets,” James added.

The SAC Board is calling for further discussion, in coming months, between sugar producers and users to find a pathway to achieve this mutually beneficial outcome.

“A part of the solution must be the correct implementation of the existing Treaty [Revised Treaty of Chaguaramas] processes, in particular for brown sugar, which has seen a marked erosion of value in recent months. SAC members continue to dialogue with their respective governments, sugar users and the CARICOM Secretariat to find solutions,” said the SAC Chairman.

SAC Directors also reported at the Board meeting that over the next 12 to 18 months, SAC industries would have the capacity to supply the regional market with 280,000 tonnes of direct consumption and plantation white sugar as investments are currently taking place to increase capacity.

The association says additional lands are being brought into cane production that would increase sugar production and that in one member state, storage and shipping has increased to accommodate larger vessels of up to 30,000 metric tons.

SAC members – the Barbados Agricultural Management Company, Belize Sugar Industries Limited, Guyana Sugar Corporation Inc., and The Sugar Manufacturing Corporation Of Jamaica Ltd – are projected to produce around 450,000 metric tonnes of sugar for the 2018/19 crop.

The association has also reported that to date the region has exported 133,000 tonnes of sugar to the European Union (EU) market at global market prices. However, it remains concerned that extra-regional duty-free imports are being dumped into the CARICOM market at less than half the value they achieve in their home markets.

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