Tonight the contention continues to build between the BSCFA and BSI/ASAR, at the heels of a proposal made by ASR to invest twenty two million dollars to upgrade the factory in preparation of the coming changes in the EU market regime in October 2017. As we had previously reported for this investment to happen BSI/ASR is proposing to amend the 2015 cane purchase agreement to cement the current revenue share agreement as well as the payment formula for bagasse until 2022.
Yesterday BSI issued a release on the matter stating that while the other two associations have agreed to this proposal, the BSCFA is not in agreement and has presented a counter-proposal. In their own release issued today BSCFA is however denying this stating and we quote “BSCFA has not yet provided BSI with a counterproposal, as this will be done upon conclusion of consultations with its members.” End quote
BSCFA further adds that while they acknowledge that ASR’s proposal will bring added benefit to the industry their concern falls in the proposed amendment to cement the current commercial agreement, as they believe that this will put farmers at a great disadvantage.
BSCFA adds that while they do not wish a complete revision of the contract there are some areas of the agreement which they believe needs revision including “clarification on the financial and legal obligations and responsibilities that ownership of cane implies, clarification on the calculation of the Net stripped Value of Sugar and Molasses on which farmers are paid, as well as assurance that BSI will have the milling capacity to grind the farmer’s cane supply and the manner in which the bagasse payment would be revisited.
In ending their release BSCFA also contests statements made by BSI in their release as it refers to the delivery of cane. BSI/ASR stated that they would not be able to accept cane from BSCFA if a cane purchase agreement is not in place since there is no provision under the sugar act that gives the milling company the legal right not to accept cane from farmers who do not have a cane purchase agreement in place. The act states that no manufacturer shall purchase or take delivery of any sugar cane except from the farmers appearing in the Cane Farmers registry. BSCFA members appear in the registry, and through the contract between BSCFA and BSI are entitled to deliver cane.” End quote