The Belize Sugar Industries announced that $19.7 million will be circulated in the northern economy because of the record prices. 

by Marco Lopez

BELIZE CITY, Tues. Oct. 31, 2023

Sugarcane farmers in northern Belize will see the highest payments for their crop since 2015. This is due to a record-breaking final sugar cane payment price, set at $86.28 per ton for the 2023 crop. The Belize Sugar Industries (BSI) in a press release announced that a combination of factors, including high global prices of sugar and strategic investments made by the mill, contributed to the improved cane prices.

Cane farmers are now urged to invest in their fields to improve yields going forward.

Shawn Chavarria, Director of Finance at BSI, during a press conference on Tuesday said, “The added value from the savings in logistics costs are also helping to improve the value for sugar and therefore cane prices to farmers, given the fact that for our commercial agreement, if we can get a higher value for sugar or lower logistics cost, then farmers share in that. So, for us, it’s really a proud moment.”

Chavarria suggested that this new record-high payment price is an indication that the commercial agreement between the mill and the cane farmers associations is in reality a favorable one.

There has been a prolonged impasse in the negotiations between the mill and the Belize Sugar Cane Farmers Association (BSCFA) over the terms of a new commercial agreement. In essence, the association, whose members produce approximately half of the sugar processed by BSI, is seeking a new revenue-sharing agreement that would result in a higher payout for its farmers. BSI is now optimistic that with the new prices, the association may become more inclined to signing a new commercial agreement, and the upcoming crop scheduled to start in 6 weeks will proceed without delays.

“We similarly don’t foresee that we might be having issues from the commercial agreement to make a start, although we don’t have one in place as yet with the Belize Sugar Cane Farmers Association. We believe that should pick up some momentum in the coming weeks to try to reach an agreement so that we have a contract in place to commence deliveries next year,” Chavarria said.

When he spoke to AMANDALA, however, the Chairman of the BSCFA, Alfredo Ortega, said that the association has no intention to sign a new commercial agreement until the completion of the government’s Commission of Inquiry investigation into the sugar industry. He shared that, in fact, they intend to sign an extension to the interim agreement currently in place to allow farmers to deliver their cane in time for the start of the new crop.  

“In reality, we are seeking to sign an extension, not a long-term agreement at this point, because what we have been asking for the BSCFA is the Commission of Inquiry being tasked to do the necessary investigation. Based on their investigation then, we have our plan to negotiate with them based on the information that the commission brings out. From there, we can look forward into a long-term agreement with them; but as we speak right now, our aim is to sign an extension,” Ortega revealed. 

The inquiry would include an assessment of the financial outlays of the mill in an effort to get a clearer picture of its operational costs in order to determine whether, in fact, the mill could afford to give farmers a larger share of revenue earned.

While the BSCFA and BSI hash out their differences, the global market is currently seeing the highest prices in sugar. BSI in its release stated that, despite a significant decrease in sugar cane yield – down by 164,000 metric tons compared to last year’s output, northern Belize will see an additional $5.9 million pumped into the economy from sugar cane sales compared to the previous year.  

Ortega pointed out that while the price is “good”, compared to prices in neighboring Latin American countries it is still considerably low.

The mill urges farmers to invest in their fields to improve yield, and ultimately benefit from the increase in global prices.

Notably, Chavarria said that they do not foresee any setbacks due to the oftentimes boggy sugar roads.

For now, the industry is on standby — with hopes high in various sections of the country that the extension of the interim agreement between the mill and the largest sugar cane farmer association is finalized and signed. In the absence of such an extension, delays seen in recent years may reoccur, and revenue for both the farmers and the mill would be impacted.