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Sugar crop begins in ‘good faith’

Updated: Dec 29, 2021

After having been delayed by one week, the sugar crop began today, after the mill and the largest sugar-industry association agreed to engage in “good faith” talks.

The start of the grinding season follows last week’s meeting called by the Sugar Industry Control Board (SICB) at which it was agreed that the feuding parties–namely Belize Sugar Industries Limited (ASR/BSI) and the Belize Sugar Cane Famers Association (BSCFA)–would operate under a four-month interim agreement. The interim agreement is set to expire on April 30, 2022.

According to a BSCFA release, the Prime Minister had intervened in the matter to propose a three-point way forward for the parties: First, that ASR/BSI and BSCFA sign an interim agreement that maintains the existing terms and conditions of the current commercial agreement. Second, that the parties engage in “good faith negotiations beginning in January 2022 and conclude a new commercial agreement before April 30, 2022.”

Finally, it was proposed that if the parties are unable to conclude a new agreement by April 30, 2022, the “interim agreement will expire; and … only associations and registered cane farmers who have signed commercial agreements with BSI/ASR will be permitted to deliver sugar cane to the mill.”

The BSCFA’s release explained that the association had also called for there to be the possibility of an extension to August 1, if it is is that they are unable to forge a new commercial agreement.

The mill likewise welcomed the start of the crop. In a short release, ASR/BSI wrote: “The new date, one week later than had been initially agreed, is a critical decision for the entire industry and bodes well for this year’s production. BSI encourages farmers from all associations to deliver their cane since it has active agreements with all four associations. BSI and BSCFA will continue discussions to reach a mutually beneficial agreement.”

As we have previously reported, ASR/BSI and BSCFA are at odds over the existing commercial agreement, with the pricing mechanism being the latter’s most salient grievance. With the interim agreement in hand, the BSCFA had called on its members–via a December 23rd press release–to “obey the SICB directive by commencing deliveries of clean and mature cane to the mill as of that declared date [December 27th, 2021].”

The BSCFA’s release added that that association “discourages any cane farmer from withholding cane deliveries or from taking any action which will disrupt the cane delivery schedule.”

The northern sugar industry has a total of four associations. However, BSCFA’s membership of 3,365 farmers accounts for more than half of the farmers and cane production. Its size, therefore, gives it the ostensible leverage that it has exercised in the negotiations with the mill. The other three associations, however, had been ready to start the crop from Monday, December 20.

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