Thursday 1 February 2007

Angostura facing increased prices


The shuttered Brechin Castle sugar factory is among the assets of the defunct Caroni 1975 Ltd. which are being offered for sale by Government.
  

Angostura facing increased prices
Caroni shutdown means increased imports of molasses, the main ingredient in rum
If most manufacturers will be able to shrug off the closure of the sugar cane industry following the 2007 crop, not so Angostura Limited.
Caroni’s shutdown will increase the cost to the company of producing rum, said Michael Carballo, company secretary of the Angostura group.
For one things, he said it will mean that the company will have to import all of the molasses it uses in the manufacture of rum.
Carballo said, “The cost of molasses has been rising significantly. It will continue to affect the cost of producing rum, without a doubt.”
Asked when the price increases are likely to go into effect, Carballo could not be specific, and did not give a date, but said it will be sometime in 2007.
I suspect that most increases will take effect in late 2007/2008. It depends on what (we) could get out of the Sugar Manufacturing Company Ltd (SMCL) this year.
Currently, we get between 25-30,000 metric tonnes of molasses—about 30 per cent of our total requirement—from SMCL.”
Carballo said importing molasses, with added freight and port storage costs, will lead to a rise in the final cost of the production of rum.
The price of molasses on the international market has increased over the last year or so. It has doubled over the past three years. Molasses could cost US$150 a metric tonne, inclusive of freight,” Carballo said.
He said the supply of molasses from the SMCL has been steadily “dwindling at a slow rate,” going down from 60,000 metric tonnes to 30,000 over the last four years.
Molasses can be imported from St Kitts, Fiji and Central America, but Angostura is currently buying the raw product from Venezuela.
We deal with major commodity players like Tate and Lyle, who can source it from Guatemala and Venezuela. The freight element is high. We have to pay to store it in tanks,” the Angostura executive said.
Carballo said the company is seeking a meeting with Christine Sahadeo Minister in the Ministry of Finance, to discuss the impact of the industry’s closure on the rum industry.
 
Vsep stories: Life after Caroni
Ramdhanie Rampersad, 63, was a cane cutter.
That is, until he participated in the voluntary separation of employment programme (VSEP) offered by defunct Caroni (1975) Ltd.
Nowadays, Rampersad, of Korea Village, Roopsingh Road, Carapichaima, is not working. He survives on $1,000 from the National Insurance Board, which his wife, Lilauthee, said is barely enough to buy groceries, far less pay bills.
“I’m staying with my son in Korea Village, and he’s staying with his daughter in the same area,” Lilauthee said.
She said her husband spent much of his VSEP money on doctor’s bills and medication for diabetes and kidney ailments.
One tablet alone to treat his diabetes costs $8. Another tablet for his prostate problems costs $7.
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Samuel Hackett of Mathura Street in Felicity, central Trinidad, had been a cane cutter at Caroni (1975) Ltd since 1958.
Hackett’s mother was a part-time cane cutter and he started cutting cane when he was nine years old. He is now 60.
This Monday afternoon, he left home to buy feed for his parrot, Simba.
Since taking VSEP, Hackett gets a day job here and there off-loading containers. Given his age, he’s not looking for full-time work. So he waits on a call from a friend when a container arrives in Enterprise to help offload electrical fittings.
His wife said they survive on their savings, having invested the VSEP money at the Unit Trust Corporation.
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He opens his front gate at New Settlement, Dow Village, to bring in his bicycle.
Mukesh Sinanan (not his real name) worked for Caroni (1975) Ltd for more than 50 years.
He was only eight when he took up employment with the company pulling a bison cart out of the canefields.
One of his duties was to clear the fields for the bison carts to pass.
In dem days, I used to get 50 cents a day,” Sinanan said. “In 1969, I started operating crane for $45 a day.”
The date Sinanan collected his VSEP is etched into his memory—August 18, 2003.
I won’t forget that date,” Sinanan said.
His bald head is covered with a tattered Bob Marley floppy hat. His khaki pants, tucked into knee-high black garden boots, has fig stains on one leg.
He was leaning against a short wall, behind which was his sacred place of prayer. There was a lit deya illuminating the image of Mother Lakshmi and other Hindu deities.
Neither he nor his wife wanted their photos taken because Sinanan is still trying to collect outstanding money from Caroni. Poor record keeping means that the number of years he worked is in dispute and is still to be sorted out.
Sinanan keeps a garden of coconuts, green fig and pigeon peas on Caroni-owned land at Brechin Castle, but there’s little yield from it.
I plant peas, but the owner does come and pick,” Sinanan said in a deadpan voice. “That is for me and the thief. They gone and pick out the coconut.”
He said former Caroni workers were told they would get five acres of land for agricultural purposes and a lot of land to build a house, but they are now being told that those who already own a home will no longer be so entitled.
Plenty people have children. If they get a lot, they will give it to them,” Sinanan said.
Sinanan said 25 per cent of those who collected VSEP are doing nothing.
He said younger ex-Caroni employees will get work with contractors here and there, but people like himself will find it hard to secure a job.
He said he asked a crane operator for a job, but was told he’s too old.
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Syamari Bikharie of New Settlement, Dow Village, rides a bicycle to get to the golf course at Brechin Castle, Couva.
That’s the job he has nowadays, much different from the days when he drove a tractor at Caroni (1975) Ltd.
He worked for the sugar company for 45 years. Not all of it was spent behind the wheels of a tractor and harvester, though. He started off cutting and loading cane and keeping the fields clean and tidy.
In the beginning, he worked for $2 a day. Then it went up to $2.45.

Manufacturers unfazed by Caroni closure

BY SANDRA CHOUTI

The president of the Trinidad and Tobago Manufacturers’ Association (TTMA) Paul Quesnel said he does not expect the end of sugar production in T&T to greatly affect the local market.
That’s because the country has for a long time been importing sugar for local consumption.
Locally produced sugar has had to be exported to the European Union to satisfy this country’s export quota under the terms of the Lome Convention

The Convention is an international aid and trade agreement between the African, Caribbean and Pacific countries (ACP) group and the European Union aimed at supporting the efforts of the “ACP states” to achieve comprehensive, self-reliant and self-sustained development.
The TTMA’s CEO Natasha Mustapha agreed with Quesnel. She said the end of sugar production later this year should not directly affect its members as much as it will the farmers and those employed in the sugar cane industry.

The Sugar Manuyfacturing Company Limited imports the sugar required by TTMA members, earning a small commission for itself in the process.
SMCL purchases sugar and sells it to us,” Mustapha said. “We don’t get preferential pricing. Almost everybody in the food and beverage industry uses a small quantity of sugar. SM Jaleel is the largest user of sugar,” she said.

A smaller quantity is used by one construction company in the manufacture of concrete products and by the pharmaceutical industry, namely Genethics Pharmaceuticals Ltd, which adds it to syrups and the like.

Genethics’ director and a former TTMA president Anthony Aboud said his company buys about three to four metric tonnes of sugar a month from SMCL.
It does not make sense for me to be a direct importer. The TTMA has collectively negotiated a price from SMCL that is more competitive than if you go and buy it off the shelf,” the businessman said.

He observed that the local sugar industry was ending for the same reason as the authorities in St Kitts had decided to end that island’s sugar cultivation: it was not competitive.
It’s not a competitive industry when compared to countries like Brazil where you can get sugar at a price better than what you can get it for here,” Aboud said.
However, Quesnel said the price at which SMCL has been selling sugar to manufacturers has increased since last November.

A director at Kiss Baking Company Ltd, Quesnel said the company imports an average of 20,000 metric tonnes of sugar annually to make its cakes and breads.
The Ministry of Trade and Industry last year gave approval to manufacturers to import 60,000 metric tonnes of refined sugar.

Wayne Punnette, the ministry’s director of trade, said before October 2006, the Sugar Manufacturing Company Ltd (SMCL) was the only entity authorised to import refined sugar.
Manufacturers raised the issue that they could get sugar at a more competitive price and on that basis, government agreed for them to import sugar,” Punnette said.

The trade ministry official said import licences have been granted for the next 14 months.
He said most of the small manufacturers would not import sugar on an individual basis as it’s not worth their while to bring in a few hundred pounds.

He said it makes more economic sense for the Solos and the SM Jaleels to import sugar directly and price is the determining factor.
The more popular sources have been Brazil, Colombia and Guatemala. Wherever they can get a good price and the quality is acceptable,” Punnette said.
He said scheduling problems have prevented Guyana from supplying Trinidad with large amounts of raw sugar.
 
The problem is that Guyana and Belize can only provide raw sugar, but the demand is for refined sugar,” Punnette said.

Former Caroni CEO says most ex-workers have adjusted well



A former Caroni worker carries on doing what he knows best as he tends his own agricultural plot.
Chandra Bobart’s last major responsibility as acting chief executive officer of the now defunct Caroni (1975) Ltd was to ensure that the voluntary separation employment programme (VSEP) was “properly executed in accordance with shareholders’ directions.”
Bobart, who acted as CEO in the last five months of 2003—the same year that 9,000 Caroni staff and daily paid workers were given VSEP—said most of those who went home were able to put their VSEP payments to wise use.
He said the initiative and drive of the ex-Caroni workers has helped them to survive.
“Many of them became self-employed. I interface with them on the streets and in the groceries.They have adjusted themselves. A miniscule number of them can be found in CEPEP and URP work.”
Bobart said some former sugar workers are driving taxis, working as mechanics or are employed in service or energy-based industries.
He said that given that 9,000 were displaced, the crime rate in central Trinidad did not increase, which is a credit to the character of the ex-Caroni workers.
Given the fact that people in the sugar industry have never been culturally conditioned to have a dependency syndrome and always pulled themselves up by their own bootstraps, they were able to, with whatever little VSEP money they got, whatever little training they got, put it to wise use,” said Bobart, a mechanical engineer by profession.
Prior to acting as CEO, Bobart was a group factory manager in charge of Caroni’s refineries.
He got his engineering certification through two scholarships, one from Tate and Lyle, a world leading ingredients company with operations predominantly focused in Europe, the Americas and South East Asia. It produces a diverse range of food and industrial ingredients made from renewable resources such as corn (maize), wheat and sugar.
Before 1921, Tate and Lyle were two separate cane sugar refining operations. The two merged in 1921 to form Tate & Lyle. In the mid-1930s Tate & Lyle began to purchase land and set up production facilities in Jamaica, Trinidad, Belize and Mauritius. To make sure their increasing demand for sugar would be met, the United States and Britain encouraged cane sugar production in many Third World countries.
In 1965, Tate & Lyle diversified into agri-business and chemical research, leaving fewer resources to improve sugar technology or yields. In the mid-1970s, Tate & Lyle sold its plantations in Jamaica, Trinidad and Belize and began to concentrate on importing and refining in the United Kingdom. This left countries that produce and sell raw sugar with the riskiest part of the business.

Life after Caroni



A view across a canefield. Such views are typical of the heart of sugarcane country in central Trinidad. Photos: Dilip Singh

The wind whistles through tall pine trees atop a ridge in central Trinidad.

The view below is that of Trinidad’s sugar belt—miles and miles of cane stalks still standing, but no longer tended—that is slowing giving way to housing, industry and energy. Land adjacent to the National Energy Corporation along Rivulet Road, Couva, has been cleared for dozens of pipes which are being stored for industrial sites in south Trinidad.
 
The former estate manager is speaking candidly enough, but stops short of allowing his name to be used as he has an outstanding legal matter over land use and acquisition with sugar company officials.

He spoke of a few sugar cane farmers providing rum producer Angostura Ltd with freshly-cut canes to make its 10 Cane rum which is sold in North America.
The former manager said the contracted farmers have three hours from the time the cane is cut to get it to Angostura’s Ste Madeleine operations.

He said a French company is negotiating with some cane farmers to form a co-operative to purchase the assets of the Sugar Manufacturing Company Ltd (SMCL), which replaced Caroni.
The French company is not interested in the sugarcane itself, but the by-product—bagasse— which they plan to process into paper, the former manager said.
He also spoke about a former Caroni manager at Brechin Castle who paid $18,000 for tonnes of bagasse that was reportedly worth $3 million.
 
He used Caroni equipment and materials to fence off the bagasse,” the former estate manager said. “He made about ten times the VSEP he got.”

The former estate manager, who has cultivated citrus on land owned by Caroni but gives it all away, said efforts are being made to get former Caroni workers to form a co-operative to produce food.
 
Government has asked SMCL to help them,” the former estate manager said.
Such assistance is expected to come in the way of brush cutting land, plowing, rotavating, banking and providing fertilisers and pesticides, which many workers will not be able to afford on their own.

He explained that assistance will not be provided in the form of money, but for services and equipment provided and costed accordingly. The idea is to pay those agricultural farmers based on the quantum of vegetables produced.
I don’t believe in giving cash to produce. Money is a disincentive,” the former estate manager said.

 Regarding the occupation of Caroni-owned houses, he said they signed agreements to the effect that they can purchase those properties, but a new recommendation has been made that they can buy only 10,000 square feet of property.
In this former manager’s case, 10,000 square feet doesn’t cover his water tank and citrus fruit trees laid out in neat rows bearing handsomely in the flat plains below. He is interested in buying the property, on one condition: he can afford the price.
In the midday sun, a casual worker was brushcutting the grass, giving greater prominence to the yellow grapefruits set against pommecythere-green leaves.