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SAC issues position paper for regional integration of sugar market

Wednesday, September 12, 2018

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KINGSTON, Jamaica — The Sugar Association of the Caribbean (SAC), which represents sugar producers in the Caribbean Community (CARICOM), has disclosed that it issued a position paper on the regional integration of the sugar market on September 7.

According to SAC, CARICOM sugar producers are responding to changing market dynamics, which traditionally saw most CARICOM produced sugar shipped to the EU for refining, while much of the region's demand has been met by extra-regional imported sugar.

The paper suggests that the 300,000-ton demand for sugar in CARICOM can easily be met by supply from the region's industries which produce more than 450,000 tons of the sweetener annually, SAC said.

Currently around 200, 000 tons of this demand is met with imports from non-CARICOM countries, which enjoy tariff-free access due to the differentiation of white and brown sugar under CARICOM rules, the association said.

“The paper makes the argument that review of this market distortion can produce a win-win for CARICOM sugar producers, industrial users of sugar and consumers, by creating a regional market that offers a level playing field to those manufacturing sugar-containing products.

“It also notes that a review will provide better and reliable access to regional sugar, matched by sugar industry commitments to produce the volume and quality required for the majority of production needs. It says that the market presently works for brown sugar, which is fully protected by the Common External Tariff, and has encouraged a vibrant competition among CARICOM producers, driving down prices. It can easily do so for all sugar needs as producers adapt their production to produce white and brown sugar to a high quality,” SAC said.

The paper states that CARICOM sugar producers are at a disadvantage to many other regions which protect their own industries, permitting them to export their residual sugar at knock-down global market prices. CARICOM producers currently have no such protection, nor access to markets offering preferential pricing on which to base investment to improve their efficiency, SAC reasoned.

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