Screen_Shot_2014-11-06_at_7.54.29_PMThe negotiations into the payment for bagasse to cane farmers have not seen too much progress over the last few months. In fact, ever since BSI proposed its formula and a proposal of fifty-one cents payment, there has not been any further development in the matter. That is, until today when BSI held a press conference at the factory and shared their decision to taking on an entirely new approach at the pending situation.

 

Truth is, the revelation revealed today by factory officials ’may very well change the way this matter is resolved since they now are literally placing the decision on a way ahead in the hands of the farmers, every – single – farmer. In a statement presented by Financial Director, Belizario Carballo, officials at the factory say that the current stand still in the negotiations is holding back progress on the critical future planning for all industry stake holders and threatens to delay the next crop once again, which would quote, “have devastating consequences for the industry, including cane farmers,” end of quote. In that light, BSI/ASR has decided to take another approach in ensuring that the differences are resolved but through the Belize Sugar Cane Farmers Association.

 

Belizario Carballo – Financial Director


“As highlighted in the letter, the 2014/2015 crop may well be a record crop and of benefit to the national economy and in particular industries stakeholders including cane farmers, this depends on its timely start in order to harvest all available cane under optimal weather conditions, I addition, under the terms of a long term sales agreement negotiated with Tate & Lyle sugars, Belize sugar exported to the EU for the 2014/2015 crop will be at a premium over the current EU price providing a valuable window of opportunity in which for the prepare in the decline of future prices as a result of the changes in the EU sugar market. BSI has a responsibility to cane farmers to ensure the 2014/2015 is a success and which will place the industry in a better course for the future, we have now taken a decision in light of these circumstances to move ahead and to coordinate the crop with those farmers and group of farmers who wish to deliver their cane.”

 

In other words, BSI intends to plan and manage the 2014/2015 harvest with individual farmers or groups of farmers willing to agree to and sign a new contract with the factory.

 

Belizario Carballo – Financial Director


“BSI will now pursue separate but similar agreements to the draft agreement last discussed with the BSCFA on 9th October 2014, with other Associations of cane farmers, group of farmers and if necessary individual cane farmers who wish to deliver their cane, the agreement is fundamentally the same as has existed in the past, the agreement sets out the formula for the price of cane, it respects the 65/35 sharing ratio of net street value of sugar and molasses sales between farmer and miller respectively which has government previous agreements the new element is the inclusion for the provision for payment of bagasse which BSI has committed to as part of negotiating a new agreement, the viability of the industry is at risk with the end of the current EU sugar regime in 2017 there is little time remaining to prepare the industry for global market changes and this present the greatest threat at the moment it is time to move forward in mind of a new commercial agreement between the miller and cane farmers and work together to meet the challenges of improving industry efficiency, productivity and competitiveness which will ensure its long term success.”

 

Mac McLachlan – International Relations Vice Presidnet, ASR


“In many respects we forced to this decision because the alternative to risk having a delay in the crop or not having a crop all these things we have been talking about would be very critical and fatal for the industry.”


Now this does not preclude us to continuing to talk to BSCFA it doesn’t preclude us from anything in the future but we feel in the responsibility to cane farmers to ensure should they wish to bring their cane, reach an agreement and have their cane milled at Tower Hill.”

 

The contract is for a seven year period, four years more than the other agreement was slated for. BSI’s Legal Counsel Michael Young was present at the press briefing and said that this new contract is, by their terms, much better than the last.

 

Michael Young – BSI legal Counsel


“One of the difficulties as a matter of fact a grave difficulty of the former agreement is that it was not complete and that gave rise in difference between the parties, this agreement is more complete and furthermore it includes and economic factor better for the farmers when you look at this agreement than what was there before because it deals economically with the very issue which has been given rise to problems between the cane farmers Association and BSI so what is being offered now is better than what was there before.”

 

According to the company, and as they stated in their statement, the decision was necessary to prepare for the global market changes which present the greatest threat to the industry at the moment.

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