The Guyana Sugar Corporation (GuySuCo) has missed its sugar production target for the first crop of 2020 by almost 9,500 tonnes, according to the main sugar workers’ union, the Guyana Agricultural and General Workers’ Union (GAWU).
The corporation was aiming for a target of 46,476 tonnes from production at its three operable estates, Albion, Blairmont and Uitvlugt. Production had been extended at Albion and Blairmont by several weeks to reduce the shortfall.
In a press statement issued yesterday, GAWU said it was informed that sugar production reached only 37,013 tonnes of sugar, which represents a shortfall of 9,462 tonnes.
GAWU said it was alarmed by the underperformance of the industry, while noting that based on the figures it has been given, no estate achieved even 90 per cent of its target. “For our Union and more so, the thousands of sugar workers, this is most distressing,” it said.
Additionally, GAWU noted that it has been told that up to mid-May, cane yields were far below the corporation’s planned objective as stated in its Strategic Plan. “The information revealed that Albion produced 57.86 tonnes cane per hectare (TcH) as against a target of 77.59 TcH; Blairmont produced 69.90 TcH versus a target of 82.59 TcH and Uitvlugt produced 57.64 TcH compared to a target of 75.76,” it noted.
Further, GAWU also said the information it has received indicates that overall factory performance was far from acceptable. “Again, as at mid-May, the three (3) factories in operation operated at an average of 95 hours per week against a target of 140,” it said, while noting that frequent factory breakdowns have been plaguing GuySuCo for several crops. “The GAWU has pointed out previously that factory failures continue unabated while the Corporation boasts an expanded staff structure at its Factory Operations Department,” the union added.
Meanwhile, with the out-of-crop season now in progress, maintenance activities have commenced at factories. However, GAWU said it has learnt that that GuySuCo is aware that the lack of adequate funding to procure needed spares for the upcoming out-of-crop season will pose a challenge to the maintenance programme. “This is an ominous sign for grinding in the upcoming second crop 2020 which is typically longer in duration. At Uitvlugt factory for example, out-of-crop maintenance is in progress for many weeks now and workers have shared that they are instructed to re-use worn parts in areas that required complete replacements. This level of reckless engineering practice directed by the technical team will no doubt eventuate into frequent factory breakdowns during the upcoming grinding operations,” the union lamented, before adding that it remains disturbed by the laxity on overall management of the sugar industry.
In May, GuySuCo had informed the caretaker government that its future hinges on a government bailout as it had exhausted its finances. It did not receive a response until just over a week ago, when the Ministry of Finance said that it could not assist the corporation with a financial bailout as it did not have the funds to do so.
“The Ministry of Finance notes GuySuCo’s request to the Government for a bailout, and wishes to assure that it is actively seeking to assist GuySuCo to access funds that are available to it, to mitigate its present challenges. Notwithstanding however, the prevailing national circumstances, coupled with the challenges of COVID-19 and a reduced national income, render the Treasury incapable of providing a bailout to GuySuCo,” the ministry said in a statement.
The statement followed the union’s release of a letter to president David Granger by the Chairman of GuySuCo’s Board of Directors, John Dow, in which he sought an urgent bailout to alleviate the crisis the corporation is in.
“Our Finance Department estimates that the Corporation is expected to be out of cash by the 2nd week in June and until then we can only afford to meet labour, fuel and cane farmers’ payments and the bare essentials (labour transport, lubricants etc),” he highlighted, before stating that cash will not be available to meet “any outgoings for spares and materials for the mid-year Out-of-Crop maintenance of our factories.”
“This inability to purchase spares and materials is likely to result in factory performance in the 2nd Crop 2020 being adversely affected with increased factory downtime, reduced sucrose extraction at the milling plant and lower sugar and molasses production,” Dow informed the president.
With $2.1 billion owed to creditors, Dow said, they are unlikely continue to grant further credit. “Our inability to pay creditors in time has resulted in many of our most experienced contractors being unwilling to tender for GuySuCo projects, and creditors have been demanding large up-front payments before supplying goods,” he explained.
GuySuCo’s current financial straits mirrors the situation the corporation had found itself in when the APNU+AFC government took office in May, 2015.
The Guyana Agricultural and General Workers’ Union has said GuySuCo has fallen short of its target by almost 9,500 tonnes.
