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Uitvlugt woes
DEAR EDITOR,
The recent fiasco at Uitvlugt which resulted in a 300:1 product conversion ratio may lead to a solution for the Industry’s profitability issues. This comes at a very unfortunate time, when the economy has been spiraling downward with increased national debt on the horizon. The local price of sugar will most likely increase, at a time when the buying power of consumers has dramatically deteriorated.
However profit improvement should be expected over the medium to long term. Covering operating costs and overhead will be challenging in the near term if the conversion ratio continues to be too high.
The silver lining is that demand and supply dynamics in the local market will not hinder the expected price growth seen in the global market due to the supply shortfall. Instead we should expect an improved profitability position for GuySuco which may help self finance a renewed expansion of local operations.
Whether sugar readjusts to regain alignment with cane juice market prices of $200, your guess is as good as mine. The equivalency in per pound prices is yet to be seen. Timing will determine the level of price courage to be expected going forward. A healthier consumer base appears to be on the horizon as a little goes a long way in months to come.
Best regards,
Mr. Jamil Changlee
Chairman
The Cooperative Republicans of Guyana
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