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Low price a challenge

Felix Chaudhary
Friday, December 14, 2012

THE Fiji Sugar Corporation has revealed that because of the current low sugar price, negotiations for the 2013 forecast price could prove to be a challenge.

FSC executive chairman Abdul Khan said negotiations were continuing with Tate and Lyle Sugars for a continuation of the current contract and details would be announced once these were completed.

He said it was important for sugarcane farmers and industry stakeholders to understand that the current sugar price of approximately US19 cents a pound was significantly lower than the price that FSC was able to negotiate for local growers.

"It is early days yet but you cannot push aside that it's going to be difficult because of the current world sugar price of US19 cents per pound.

"However, in saying that, prices either go up or in the worst case scenario come down but the industry should be rest assured that we will negotiate the best price possible for Fiji sugar," he said.

Fiji receives approximately $1000 per tonne for raw sugar exported to Tate and Lyle in the United Kingdom which is significantly higher than the global price of almost $730 per tonne.

Sugarcane growers in the country received $65 per tonne for the 2011 season despite a forecast price of $52.20.

In an earlier interview with this newspaper Sugar permanent secretary Lieutenant Colonel Manasa Vaniqi revealed growers should surpass that figure this season despite a forecast price of $53.55.

According to Commonwealth Bank of Australia analyst Luke Matthews, global sugar prices were been affected by China's increase in domestic sugar production resulting in a huge reduction in imports.

Huge increases in local production for two of the world's biggest sugar consumers Russia and China could result in a further slump in global sugar prices next year.





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