Fiji Sugar Mill Inefficiencies Cost Farmers $161 Million: Union

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Fiji Sugar Corporation chairman dispute figures

By Felix Chaudhary

SUVA, Fiji (Fiji Times, May 28, 2012) – The country’s biggest sugarcane growers union says cane farmers have lost over $300 million (US$160.6 million) over the past three years attributed to milling inefficiencies.

However, Fiji Sugar Corporation executive chairman Abdul Khan disputed this figure saying the theoretical value would be around $75 million over the said period.

The National Farmers Union, with a total membership of over 6000 active growers, said for growers confidence in the industry to return, tonnes cane to tonnes sugar (TCTS) figures had to improve.

The milling problem is reflected in the worsening TCTS ratio in the past three years, NFU general secretary Mahendra Chaudhry said.

The average TCTS has worsened from 10 in 2006 and 2007 to 13.5 for 2009, 14.3 in 2010 and 13.5 in the 2011 season. This means that at least 40 per cent of the cane delivered to mills is wasted, he said.

Mr Chaudhry said this issue was discussed at a NFU meeting in Lautoka last Saturday.

He added the losses from milling inefficiency when viewed against rapidly decreasing cane prices in recent years underscored the plight of cane farmers in the country today.

In just over a decade, cane prices have fallen from a record pre-devaluation $82 per tonne in 1999 to the lowest ever payment of $49 devalued dollar per tonne for the 2010 season. However, when you look at this in real terms this amounts to $40 per tonne, Mr Chaudhry said.

Mr Khan however, said it was unfortunate that unsubstantiated comments were being made over the issue.

I’m quite sure that people realise that like any manufacturing process, if the quality of the raw material is good, the processing is a lot more efficient and the end product will be better, Mr Khan said.

The same applies to sugar manufacture. The two material issues that drive efficiency through reduction in TCTS are quality of sugarcane and the effectiveness of the mills to extract sugar.

For the past three years, Mr Khan said the average price paid for cane was $56.24 per tonne.

He said the cane quality was reduced by a further five per cent meaning that there was relatively less sugar in the sugar cane.

Combining these two points, the theoretical value would be around $75 million for the three years, Mr Khan said.

Let me emphasise that rather than harp on about a past that no one can change, lets work together to ensure that we have a vibrant sugar cane industry for the future, he said.

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