A sugar price increase will be ‘justified:’ Minister of Agriculture

By Aaron Humes: For the first time since 2014, Belize may have to contemplate an increase in the prices of plantation white and brown sugar, currently maxed at 39 and 75 cents respectively.

But Minister of Agriculture Jose Mai told the House of Representatives on Thursday that any such increase must be justified by Belize Sugar Industries Limited/American Sugar Refining (BSI/ASR), the sole entity that sells sugar locally.

The past price increase did not take profit into account, said Mai, noting that wholesalers and retailers typically only made profit margins of five cents for brown sugar and eight cents for white sugar, leading to inflated retail prices. Meanwhile, the same sugar can be sold in Mexico and Guatemala for up to three to five times that amount in Belize dollars, making it lucrative.

As Mai also noted, the pressure especially from Mexico will continue: “The situation in Mexico is such that so many have closed down because of the lack of available labor. Four mills have closed down, and the price of sugar in Mexico right now is at its highest. The plantation white sugar right now is at $1.80 per pound, we are at $0.75. So the only way we believe that we can reduce the amount of sugar leaking to Mexico and Guatemala is to find a way to increase, to increase the price, the controlled price. But it has to be based on facts and numbers that we are given.”

Mai said that no increase will match the prices in Mexico and Guatemala and so negotiations continue inside and outside Cabinet to reach a price that takes into account consumers and producers – i.e., cane farmers. Another proposal will be debated among the Executive in about two weeks.

Meanwhile, as Prime Minister John Briceño explained afterward to reporters, efforts at enforcement and catching out the sell-outs continue: “[Supplies Control Unit] has been going to these supermarkets and telling them, who do they buy their sugar from? They want to trace from the store to the wholesaler to BSI and by doing that, what you call reverse engineering, we’ll be able to see who of these wholesalers are not seeing to the local stores and then after that we can go to BSI and say, look, these people are not selling the sugar on the local market, they are allowing it to be contraband. Also, we have to try and tighten as much as we possibly can our borders but you know our borders are porous. We have a very large border and you can cross at any point in our border, so it’s a number of things we have to take into consideration and it’s not just a clear cut, oh just raise the price, because that’s not something we would do, just raise it to stop the contraband into Mexico and Guatemala.”

Mai also reported that Belize has opened up dialogue with its Mexican counterparts for direct sugar sales pending the lowering or removal of import tariffs.

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