Mills performance pathetic: farmers suffer

[posted 17 July 2009, 1500]

Fiji’s sugar industry is heading for collapse unless quick action is taken to set things right at FSC and its four mills.

The industry continues to lose millions as both FSC and the Sugar Ministry seem helpless to fix the four sugar mills which have been plagued with defects since the start of the season resulting in gross overall under- performance.

It is now confirmed that the first sugar shipment of 30,000 tonnes scheduled to have left the port of Lautoka on 15 July, did not materialise.

As of 13 July, the Corporation had only 15,000 tonnes of sugar in stock (9000 tonnes at Labasa and 6000 tonnes at Lautoka). This is only one-half of the quantity for a full shipload hence the delayed shipment.

The four mills crushed 218,382 tonnes of cane to 13th July, manufacturing about 15,000 tonnes of sugar. This gives a TCTS ratio of almost 15 tonnes of cane to one tonne of sugar – an alarming state of affairs!

TCTS at this time of the year should be around 8.5 tonnes of cane to a tonne of sugar. Using this as an indicator, the cane crushed so far should have produced 25,692 tonnes of sugar. There is therefore a shortfall of 10,692 tonnes which is worth around $11 million of which the farmers’ share comes to $8m or $3.20 per tonne of cane based on current crop estimates.

Individual Mill figures are as follows:

  Mill            Cane crushed      Sugar made         TCTS
Lautoka           43,039T              500T               86.0
Penang            63,945              5500                 11.63
Labasa          109,186               9000                 12.13
Rarawai             2212                NIL                      -

It will be seen that cane crushed at Lautoka and Rarawai Mills has produced virtually no sugar. The Lautoka Mill has made just 500 tonnes of sugar from 43,039 tonnes of cane it has crushed since the mills began operating a month ago.

What a disgraceful state of affairs for the country’s largest sugar mill! And at a time like this when mills are under performing and FSC does not have enough sugar to meet shipment commitments, its chairman and CEO are away on a world junket.

The TCTS ratio at the Penang and Labasa Mills is high at 11.63 and 12.13 tonnes of cane to a tonne of sugar.

Will the sugar industry do anything to compel FSC to compensate growers for the colossal loss they have so far suffered? It does not seem so. It is now clear that the Ministry is in league with FSC. It is reported to be working on amendments to the Sugar Industry Master Award to give leverage to FSC and reduce the income of the growers.

The Ministry has already dismantled two important industry institutions, SCOF and the Sugar Marketing Company at the behest of Australian consultants hired by FSC. Growers who have a 70% stake in the sugar proceeds have been shut out of the marketing arm of the industry.

What further evidence does one need of the direction in which the Sugar Ministry is leaning?