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Sugar unions not responsible for the
industry decline
[posted 24 March 2011,1100]
Trade unions and politicians cannot be
blamed for the current critical state of the sugar industry, says NFU
General Secretary Mahendra Chaudhry.
He was responding to statements by
Commodore Voreqe Bainimarama blaming the “politicisation” of the sugar
industry for its current decline; in particular comments that had appeared
in the Fiji Sun (22/2/11).
In a letter dated 25 February to the Prime
Minister, Mr Chaudhry pointed out that blaming unions and politics was
hardly the solution to the current crisis facing the industry.
In fact, data from FSC belies the claims
of the Prime Minister. Statistics show that in the heyday of sugar politics,
the industry had been performing at its peak - producing 4 million tonnes of
cane and well over 400,000 tonnes of sugar. In 1994, for instance sugar
production had reached a record 517,000 tonnes with a TCTS of 7.9.
The decline in the industry began after
1999 when it last produced 4 million tonnes of cane and 377,000 tonnes of
sugar. In the years 2000-2006 production varied as the following table shows
(source FSC annual reports)
Season Cane
crushed Sugar Make
TCTS
tonnes (m)
tonnes (000)
2000
3.89
341
11
2001 2.80
293
10
2002
3.42
330
10
2003 2.61
294
9
2004 3.00
314
10
2005 2.79
289
10
2006 3.23
310
10
It is in the past three years that the
industry has slumped dramatically. NB: at a time when there was no
‘politics’. This decline is clearly indicated by the following statistics (FSC
annual reports and statistics):
Season
Cane Crushed Sugar Make
TCTS
tonnes (m) tonnes (000)
2007
2.48
237
10.0
2008
2.32
208
11.0
2009
2.25
168
13.4
2010
1.80
133
13.5
One must therefore look elsewhere for the current critical state of the
industry. NFU’s own research and the views obtained from industry experts
attribute it to the following
• a drastic decline in milling standards
with the average TCTS ratio climbing to 13.5 from around 10.0 in 2007,
resulting in huge wastage of cane delivered to the mills.
• the dismantling in 2009 of key industry
institutions, created under the Sugar Industry Act of 1984, which had
ensured a consultative approach to resolving problems in the industry. As a
result, FSC is now no longer held accountable/answerable for the performance
of its mills;
• heavy financial losses incurred by
growers as a result of soaring costs of farm production, harvesting and
transportation of cane to the mills. This is aggravated by falling cane
prices as a result of low sugar make due to milling inefficiencies,
particularly in the 2009 and 2010 seasons, making cane cultivation
unprofitable
• increasing uncertainty, frustration and
hardship have lowered the morale of the growers and sapped
confidence in the future of the industry; people are simply abandoning cane
farming and turning to other forms of livelihood
• the inability to access EU funding means
that capital resources vital for the restructure and revitalisation of the
industry are not available
• the marked decline in cane production
after 2000 can be attributed to the non renewal of expiring cane leases
resulting in 6000 farming families being displaced
Unions and the politicians cannot be blamed for any of these. Indeed, the
National Farmers Union had written repeatedly to the Prime Minister and
Minister for Sugar in 2008 and 2009 highlighting the deteriorating state of
the industry and advising on measures that needed to be undertaken to
salvage it. A total of 12 letters were written between 17 September 2008 and
24 November 2009.
Except for two, all other letters were
simply ignored. Mr Chaudhry said on 20 August 2009 he wrote again to the
Prime Minister expressing concern at government’s decision to dismantle the
Sugar Cane Growers Council, pointing out the adverse consequences of such a
move.
A reply was received two months later on
26 October, acknowledging the letter but closing all further correspondence
on the subject.
Having chosen to ignore advice given by
the NFU, the Prime Minister cannot now blame the unions and the politicians
for the current state of affairs in the sugar industry. Indeed, the NFU has
nothing to gain by undermining the industry – in fact, much to lose.
Furthermore, the policies and actions of
the interim government have rendered the unions ineffective, and deprived
the growers of a voice in industry matters. The growers are the producers of
the raw material for sugar. One cannot ignore them or completely marginalise
them and still expect the industry to flourish. As mentioned earlier, cane
growers are frustrated and disillusioned. They cannot be held responsible if
things go wrong through no fault of their own.
In the past two seasons growers have
sustained enormous losses as a result of milling problems and
inefficiencies. Almost 40% of cane delivered to the mills has been lost as
either molasses or wasted juice dumped in the rivers and seas.
In 2009, total loss to the industry was
put at $100 million of which the growers sustained $70m. In the 2010 total
loss to the industry was estimated at $50m, of which the growers share came
to $35 million. In two years, therefore, cane growers have lost more than
$100m through no fault of theirs. Loss to the industry has been a massive
$150million.
The problem lies not with unions and
politicians but with FSC and its ailing mills, and interference by the State
with the checks and balances that were provided under the 1984 Sugar
Industry Act.
Mr Chaudhry said the NFU was ready and
willing to assist in the rehabilitation of the industry. “But we believe
that this can only be achieved through consultation, cooperation and holding
the respective parties in the industry - growers, the miller and workers -
accountable for their performance.”
“It is our advice that an all industry
conference be convened by you well before the commencement of the next
crushing season to agree on a rehabilitation plan through inclusive
dialogue. We await your decision” said Mr Chaudhry in the letter.
A response to the letter is yet to be
received.
LR Vayeshnoi |