Sweet news as GuySuCo ups its production target

Jul 12, 2014 News

– industry asks for $6B to buy more harvestors

In what may be considered a shift for the better in the sugar industry, the state-owned Guyana Sugar Corporation (GuySuCo) has ambitiously revised its production target upwards.

Agri Minister, Dr. Leslie Ramsammy, GuySuCo’s Chairman, Dr. Raj Singh, and Deputy, Paul Bhim appearing before the Parliamentary committee yesterday.

Appearing yesterday before the Parliamentary Sectoral Committee on Economic Services, recently appointed Chief Executive Officer, Dr. Raj Singh, disclosed that the industry is now looking at 219,000 tonnes, about 3,000 more than was announced earlier this year.
It would be the first time in the last few years that GuySuCo, struggling with labour shortages, weather and technical problems, would even be contemplating announcing any targets that is above projections set at the beginning of the year.
However, Parliamentarians are remaining cautious, yesterday demanding that GuySuCo table soonest a multi-year plan that will spell out the strategy of the sugar industry for at least the next five years. The reasons were simple. GuySuCo has been recording a string of poor performances, grounding to a 23-year low last year with 187,000 tonnes. This was down from the 260,000 tonnes announced at the beginning of the year. This year, the industry was a little more hesitant, setting a target of 216,000 tonnes of sugar.
GuySuCo will now be asking a new Board which will be appointed shortly, to consider a new strategic plan, which will be laid in the National Assembly soon after.
Accompanying the Chief Executive Officer (CEO) was his outgoing Deputy, Paul Bhim, and Minister of Agriculture, Dr. Leslie Ramsammy, among other senior managers.
The CEO, who until earlier this year was the Chairman of GuySuCo’s Board of Directors, disclosed that the industry remains a critical one for Guyana, last year earning US$116M for the country.
Its contribution to the Gross Domestic Product (GDP) remained a steady 5-8% in the last few years, despite the severe challenges.
The Parliamentary committee has oversight responsibilities to ensure GuySuCo is on the right path.
Touchy
GuySuCo has remained a largely touchy issue for both the ruling party and the Opposition because of the sheer number of workers. The sugar industry remains the largest employer for the country with 16,000 workers, 300 suppliers and about 100,000 persons indirectly dependent on its factories.
The Opposition-controlled house has been approving billions of dollars in cash to keep the industry afloat as workers moved away in droves to the gold bush and the better paying construction sector. Its flag-ship US$200M new factory at Skeldon has failed to live up to expectations despite signs of increased production.

GuySuCo says that industry requires another $6B in next three years to buy mechanical harvesters to help solve its labour problems.

The CEO yesterday insisted that the industry remains a critical one, with hundreds of millions being spent by GuySuCo annually on healthcare, community centres and drainage and irrigation.
The Skeldon, Berbice factory has also been critical in providing power at a cheap rate to the Guyana Power and Light.
However, he was clear about the need to continuously plug monies into strategic areas with evidence suggesting that the industry could turn a profit when this is done.
It was also pointed out yesterday, that factories are showing an improvement in their efficiency with more sugar per tonnage being produced, as compared to a few years back.
The CEO admitted that GuySuCo has revised its production figures for the next few years, in light of the fact that not enough resources will be available to realistically achieve them.
According to Member of Parliament, Khemraj Ramjattan, Parliament would need to study GuySuCo’s plans as a result of the adjusted production targets.
Profitability Again
GuySuCo is hoping that it can return to profitability by next year.
According to Dr. Singh, almost 14,000 hectares of lands have been converted to accommodate mechanical harvestors, representing 30% of the total area under cultivation. GuySuCo wants to now increase this by another 8,000 hectares by 2017.
Government has been banking on the mechanical harvesters to help the fallout from the poor labour turnout which has been consistently below 50% on almost all the estates in the last five years or so.
One of the major strategies by GuySuCo, the CEO said, is the leasing of lands to private cane farmers with 1,000 hectares allotted at Uitvlugt, West Coast Demerara and another 500 hectares, earmarked for allocation.
This is critical as it releases GuySuCo from spending capital on those lands. This initiative has been working well at Wales Estate, West Demerara where almost 40% of the cane has been coming from private farmers.
The officials yesterday noted that mechanization has its benefits with between 35-40 tonnes being produced per hour, compared to the two tonnes from manual labour. However, mechanization has its drawbacks with rains and poor conditions in the field a major challenge.
The initial cost of the harvesters is another challenge. Any future plans by GuySuCo will have to contemplate a mixture of both mechanical and manual labour, Singh warned.
Singh believed that up to $6B would be needed in the next three years to buy mechanized harvesters.
(Leonard Gildarie)