Belize along with various other countries who belong to the European Union’s preferential market are now bracing for direct competition following the recent EU reform on world sugar prices. In view of the introduction of beet sugar in Europe, Belize will no longer enjoy the preferential rates on sugar it has experienced in the past, thus, a reduction in prices of the sweetener is inevitable for Belizean cane farmers.
While Belize will continue to benefit from quota- and duty-free access for 1.6 million metric tons of mostly raw-sugar shipments to the EU, Belizean Sugar which stands among the highest production costs may struggle to compete against EU beet farmers who are boosting yields and increasing scale. And with eighty percent of Belizean produced sugar exporting to the EU the market is in no doubt facing troubling times. In a report analysis issued by the European page “BloombergMarkets”, Gerald Mason, Senior Vice President of Corporate Affairs at London-based refiner Tate & Lyle Sugars, is quoted as saying "It’s not that we want to leave those suppliers behind, but if Europe has made the white sugar market really competitive, we have to have access to more competitive supplies."
Under the EU, Belize is considered a market with limited alternatives and high production cost. Changes in world prices and the pressure to compete with other sugar producers can have a heavy impact on BSI/ASR, cane farmers and the economy of Belize.
Over the past years, Belize has become very dependent on sugar exports and reforms such as this can result in a deep dent on the sugar industry’s future. At the start of the 2016-2017 Sugar cane crop season back in December of last year Vice President of International Relations for ASR, Mac McLachlan, spoke of the changes that need to be done to ensure that Belize remains competitive in the new market which includes lowering the cost of production significantly which means that farmers need to start increasing productivity if they are to remain competitive in the industry. David Jessop, an adviser to companies and governments on trade and investment in the region is quoted as saying “Within a decade or so, I can see the EU market for raw sugar from the Caribbean being all but a matter of history”. The challenge from the Caribbean perspective, says Jessop, is what they can do, if anything, to ensure the future of their industry."
Prepared or not come, October 2017, the quotas that have always been a constraint for beet sugar will be lifted and beet sugar producers will be free to produce as much sugar as they like in the European Market. "It’ll be very much a question of the survival of the fittest," said Devesh Dukhira, Chief Executive Officer of the Mauritius Sugar Syndicate, representing growers. The question now is, if Belize can survive the fierce competition that is to come.
Caribbean nations are expected to meet in Kingston, Jamaica, this month to discuss the "existential threats" to the industry.