Dionne Rose, Business Reporter

Frome Sugar Factory in Westmoreland. Frome is the only state factory to have begun reaping cane in December. - File

Dr. Richard Harrison, president and chief executive officer at the Sugar Company of Jamaica (SCJ), is projecting a slight downturn in sugar this year, saying production will slide by about 3,000 tonnes, largely because of lasting effects from the storm winds and rains that buffeted the sector last year.

That 3,000 tonne decline means that Jamaican factories are targeting production of 161,867 tonnes in 2008, down from last crop year's 164,500 tonnes of the cane-based crystal.

Last year, Jamaica, which sells most of its raw sugar to Europe, earned US$95.5 million from export sugar, up from US$90 million in 2006.

This year, EU sugar will continue to fetch €496.8 per tonne, said Karl James, general manager of Jamaica Cane Product Sales.

Expected price cut

The expected price cut on preferences erode, kicks in on October 1 - four months after the 2008 crop ends - at which point it drops to €434.1, said James.

Essentially, the chief factor that would affect export sugar at this stage is production volumes.

"The industry is concerned that we have not yet seen the full effects of the Hurricane Dean damage and the fact that after Hurricane Dean there were unusually high amounts of rainfall between October and November, which we anticipate will affect the quality of the cane," Harrison told The Financial Gleaner.

In that regard, Dr. Harrison said the industry is projecting less sugar for the year. But, the SCJ, he added, is keeping watch on Frome, its estate in Westmoreland and the island's largest factory, saying early indications are that it could perform above expectations.

"The start-up at Frome has indicated that our fears might not be too well founded at this time. So, after about some months' operations, we will again review the figures and we are hoping that we will be able to make an upward adjustment," he said.

Projection figures

Releasing projection figures on a factory-by-factory basis at a sugar cane industry retreat on Wednesday, in Kingston, Harrison said privately-owned sugar factories such as Appleton Estate in St. Elizabeth is projecting 29,000 tonnes of sugar for the season, and Worthy Park Estate in St. Catherine, 20,000 tonnes.

For the state-owned sugar factories, the SCJ is projecting 111,867 tonnes of sugar and 63,365 tonnes of molasses, broken down as follows:

Frome: 50,090 tonnes of sugar, 28,136 tonnes of molasses;

Clarendon's Monymusk Estate: 17,747 tonnes of sugar, 9,639 tonnes of molasses.

Bernard Lodge, St. Catherine: 17,765 tonnes of sugar, 9,753 tonnes of molasses.

St. Thomas: 14,311 tonnes of sugar, 8,694 tonnes of molasses.

Long Pond, Trelawny: 12,025 tonnes and 7,143 tonnes of molasses.

The 2008 crop is already off to a rocky start, with only Frome having started reaping in December.

Harrison also said he faces challenges in the harvesting and transportation of cane, due mainly to shortage of transport equipment and the high cost of fuel.

dionne.rose@gleanerjm.com