Sugar talks hit sour note

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Sugar talks hit sour note

...stakeholders mull over planned closure at Appleton

BY GARFIELD MYERS
Editor at Large
South Central Bureau
myersg@jamaicaobserver.com

Sunday, August 02, 2020

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SILOAH, St Elizabeth — For over an hour in late afternoon Thursday, cane farmers and sugar workers listened patiently to speeches about Italian spirits giant, Campari Group's, planned closure of the Appleton Sugar Factory here.

The production of Appleton's world famous spirits and a rum tour, which has grown in popularity down the years, will not be affected by the closure.

Those at the town hall meeting heard from board member and former chairman of the industry regulatory agency, the Sugar Industry Authority (SIA), Allan Rickards that announcement of the closure was “disrespectful” and in “breach” of regulations requiring “one crop year's notice”.

They heard from Gary Salmon, of the All Island Cane Farmers Association that his association would fight to defend their interests.

They were told by Karl James, former CEO of the Jamaica Cane Products Sales Limited that Appleton need not close; and that the nation's hundreds-of-years-old sugar industry could be saved with the help of tariff-based protection from Government as well as greater enterprise by private producers.

Underlining the importance of tariffs to protect local sugar from cheaper imports, organiser of the town hall meeting, Basil Waite, of the Opposition People's National Party, assertively argued that just as local chicken meat and a host of other agricultural products were protected by high tariffs on imports, so should sugar.

To dramatise his point, Waite, who is aspiring to become Member of Parliament for St Elizabeth North Eastern in the next general election, said that if tariffs on imported chicken meat were to be removed, large local producers would last only as long as it takes for ship loads to arrive in Kingston from Miami.

Both James and Waite argued that globally, large and small sugar producers protected their home markets using tariffs. With the disappearance of preferential treatment for Jamaican sugar exports, tariff protection was the sensible option, said Waite.

Then, with the additional question and answer section of the meeting winding down, came a voice of impatience and militancy from the back of the room at the Siloah Primary School.

“What we gonna do?” asked cane farmer, Granville Thompson.

“We need to go out there and rebel,” he said by way of answer to his own question.

He reminded listeners of slave-era freedom fighters and national heroes Nanny of the Maroons, a reputed militant and Sam Sharpe, whose ambitious plan for passive resistance to slavery in 1831 went awry, ending in a bloody insurrection and his own death by hanging at the hands of slave masters.

“We want to go the Nanny way, we nuh wa' go the Sam Sharpe way,” said Thompson.

A smiling Thompson later told the Jamaica Observer that his call for the “Nanny way” reflected his desire for protest demonstrations.

He argued that the Appleton Sugar Factory and by extension the sugar industry in northern St Elizabeth needed to be protected. He insisted that those whose lives would be “devastated' by the planned closure amounted to close to 30,000 when the knock-on effect is measured.

In the meeting, Thompson's appeal for the “Nanny way” triggered prolonged cheers and applause, apparently reflecting widespread fear and uncertainty about the future.

From the platform, a stern-faced Rickards immediately urged careful thought, even as he “embraced” the desire for peaceful protest.

Rickards reiterated his call for thought before action, on hearing a muted call for “no sugar, no rum”.

“I want to embrace what you are saying and I want to know if you understand what it means. I am not talking about Sam Sharpe and Nanny because that is just talk ... what I have discovered in the sugar industry is that when it comes to action, you look around and nobody is behind you. When St Thomas factory was closing we had to truck people from St Catherine... to go over there and demonstrate...

“But I am asking the question: Do you understand what it means when you say 'no sugar, no rum'?... What I wonder is: Do you know what it means and how we can go about it? Are you prepared to say to Wray and Nephew 'no sugar, no rum, no sugar, no rum...' “ said Rickards, to loud cheers.

While telling the audience that “whether you want to say 'no sugar, no rum' is up to you”, Waite voiced hope that Campari – owners of J Wray & Nephew and the latter's subsidiary, Appleton Estate – as well as Prime Minister Holness were “listening”.

“I will say to you the people who will feel the brunt of the devastation that is sure to come... you have to stand up for your rights. It cannot be right for you to have built a brand for centuries and then that brand making all the sweet profits... and people are living in poverty and cannot draw a pay cheque,” Waite said.

The town hall meeting preceded Friday's announcement by J Wray & Nephew of a sweeping assistance programme worth more than $500 million for “farmers and communities impacted” by the closure of Appleton.

The news release said the social and economic intervention programme “will be spread over a three-year period, beginning in August 2020 and ending in 2023”.

Debt forgiveness, subsidies for transport of canes to the Frome Sugar Factory in Westmoreland and support for orderly transition of farmers from cane to cash crops, form part of the expansive package, said J Wray & Nephew.

In a release two days earlier formally announcing the planned closure, J Wray & Nephew Limited said management of its farm will be divested “to a third-party company with knowledge of the sugar operations” that will re-employ a significant number of the 370 employees impacted.

The release said “employees will be afforded generous separation packages and additionally, there are plans to alleviate the impact on third-party farmers”.

J Wray & Nephew insisted that the decision to close Appleton resulted from heavy, unsustainable losses amounting to billions of dollars.

The company has placed Appleton's closure in the wider context of rapidly declining national sugar production in recent years, noting that the last out-turn has been estimated at just 44,000 tonnes.

At its height in the 1960s, Jamaica's sugar production exceeded 500,000 tons annually.

Appleton's sugar production for the last crop year is said to have been just over 10,000 tonnes.

The company said the situation at Appleton had been brought to a head by COVID-19 which “resulted in the closure of bars, tourism and other routes to market, and in so doing crippled the domestic and export earnings of J Wray & Nephew”.

Company chairman Clement “Jimmy” Lawrence repeated the theme during a function at Appleton early Thursday afternoon, to mark the distribution of care packages to 1000 families, as part of a partnership with the Ministry of National Security.

“We've been subjected to several years of losses in excess of $1 billion per year,” said Lawrence.

“We started initiatives over the period to stem the tide... We are producing sugar at a higher price than we can make from the sale of it on the export market. What we have done is to progressively see how we can intervene in a way to stem the tide and subsequently, quite frankly, the whole COVID-19 [pandemic] forced us into this situation,” said Lawrence.

And while noting that the Agriculture Ministry was better able to discuss the industry, Matthew Samuda, minister without portfolio in the National Security Ministry highlighted sugar's plight.

“For as long as I have been alive and as long as I have been watching the news...we have had problems with sugar,” said Samuda.

“I think the fact is we have kicked the can down the road, we have kicked the can down the road. .... [But] I know there has been a whole slew of interventions that are coming in terms of how you put the lands back to use; how to help individuals – instead of getting them to look for a job, get them to create their own business and employment. One may have lost [a] job, but we are hoping that with some interventions we can get them to create three jobs with small business...” said Samuda.

At the town hall meeting later in the afternoon, platform speakers speculated whether the closure of Appleton was always in the works, dating back to acquisition of the J Wray & Nephew group by then named Gruppo Campari in 2012. That especially since Campari's primary and traditional interest is the alcoholic spirits industry, not sugar.

They pointed to the cutback in large acreages of land dedicated to sugar, including giving up the leased Holland Estate in 2019, as well as falling production levels in recent years, as possible indicators.

Lawrence had already rejected any such suggestion when it was put to him while interacting with journalists at Appleton earlier that day.

Campari had invested heavily at Appleton down the years, he said. That included a US$7.2 million spend in 2018 on the Joy Spence Appleton Estate Rum Experience, which was thriving as a tourist attraction prior to COVID-19.

At the town hall meeting, Waite placed the problem squarely in the hands of the Government, as he pressed his case for tariffs to protect local sugar producers.

“Sugar can only die if the Government of Jamaica wants sugar to die...” he said.

Rickards told the town hall audience that the SIA had written to J Wray & Nephew regarding what he said was the requirement of a year's notice of factory closure.

Contacted by the Sunday Observer, J Wray & Nephew's Senior Communications Director Tanikie McClarthy Allen said the company's legal department knew of no such requirement. The company had written to the SIA seeking clarification, she said.


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