Betting on the latest technology projects, agriculture 4.0 and seeking alternative products derived from sugarcane so as not to depend on international prices, are some of the lines of action on which the Guatemalan sugar sector will focus in the coming years.
Although sugar prices in the international market have improved between October 2020 and April 2021, in previous years there was a downward trend that pressured mills to explore new market opportunities for sugarcane-derived products.
In Nicaragua, it is estimated that for the 2020-2021 sugar harvest, the volume produced will be 1.2% lower than that reported in the previous cycle, a decrease that is explained by excess rainfall and high temperatures.
Figures from the National Committee of Sugar Producers of Nicaragua (CNPA) show that between the 2019-2020 sugar harvest and the 2020-2021 cycle, the volume produced decreased from 16.4 to 16.2 million quintals.
On April 26, Brazil will reactivate again on the agenda of the World Trade Organization, the complaint against Costa Rica for the imposition of a safeguard to increase the tariff on sugar.
Due to the impact of the tropical storms Iota and Eta, businessmen of the sector estimate that for the 2020-2021 harvest about 13% of the sugar cane production will be lost.
According to a report by the Association of Sugar Producers of Honduras (Amah), the rains caused by tropical storm Eta damaged approximately 23,874 hectares of cane, and in the case of Iota, approximately 19,414 hectares were affected.
Based on the willingness of Costa Rican authorities to raise the tariff on imported sugar from 45% to 73%, Brazil decided to raise the entry taxes on four animal products from Costa Rica.
Months ago, the private sector has been warning of the possibility that the country's trading partners would apply reciprocal measures because of Costa Rica's unilateral decision to raise entry taxes on importedsugar.
Following in Brazil's footsteps, Canada warned the WTO about the possibility of imposing compensation against the Costa Rican authorities' policy of raising the tariff on imported sugar from 45% to 73%.
Following an appeal filed by the importing company La Maquila Lama with the Costa Rican authorities, the government decided to reduce the additional tax on sugar purchased abroad from 34.27% to 27.68%.
With the reduction decreed by the Ministry of Economy, Industry and Commerce (MEIC), a decision that was published on August 18 in The Gazette, the total tax applied to imported sugar will be 72.68% (45% original plus 27.68% of the safeguard), which is slightly less than the 79.27% (45% original plus 34.27%), which was in force until before the enacted amendment.
Arguing that the unusual growth in sugar imports is harming local production, the Alvarado administration decided to raise the tariff on products entering Costa Rica from 45% to 73% for a three-year period.
The Ministry of Economy, Industry and Commerce (MEIC) concluded the investigation requested by the Agricultural Industrial League of Sugar Cane (LAICA) and 4 mills, on the safeguard measure against imports of solid state, granulated sugar, known as white sugar, used for domestic and industrial consumption, justifying a deterioration in the main economic indicators of the National Production Branch (RPN), details an official statement dated June 15.
Because Guatemala is the only country in the region still negotiating an FTA with the Asian country, sugar producers estimate that they have stopped selling about 400,000 metric tons.
Months ago it was reported that Guatemalan authorities would travel to South Korea in the first week of October, with the aim of restarting the Free Trade Agreement (FTA) negotiations.
Panamanian industrialists consider that the approach under which the new tax of 7% on carbonated beverages and 5% on other sugary beverages was defined uses discriminatory fiscal measures.
On November 18, Law 114 was published in the Official Journal, entitled "What creates the Action Plan to Improve Health and dictates other provisions to establish the selective tax on the consumption of sugary beverages and the criteria for its use", which stipulates a 7% tax on carbonated beverages, 5% for other sugary beverages and 10% for syrups, and sugar concentrates for the production of sugary beverages.
In a context of falling international prices, increasing production and improving efficiency are the main objectives of Guatemalan sugar producers for the 2019-2020 harvest.
Official figures detail that during the 2018-2019 harvest the production of sugar in Guatemala reached 2.9 million metric tons, and for the current harvest that has just begun the harvest of a similar volume is projected.
In El Salvador, the union of sugarcane growers estimates that for the 2019-2020 harvest will be produced about 17 million quintals, a volume that would be 15% higher than that recorded in the previous cycle.
The Sugar Association of El Salvador projects that between the 2018-2019 and 2019-2020 harvests, 2.2 million more quintals will be harvested, going from 14.8 million to 17 million quintals.
Costa Rican businessmen complain that because of export subsidies granted to sugar producers in India, there has been an artificial increase in production, causing prices to fall below costs.
Édgar Herrera, executive director of the Industrial Agricultural League of Sugarcane (Laica), explained to Elobservador.cr that "...
Both countries agreed to increase from 60,000 to 125,000 tons the export quota of Guatemalan sugar that enters the Asian nation free of tariffs.
In the framework of the Second Meeting of the Administrative Commission of the Free Trade Agreement between Guatemala and the Republic of Taiwan, held in Taipei, Taiwan on July 8 and 9, both parties agreed to eliminate tariffs for the entry of certain products, informed the Ministry of Economy of Guatemala.
Arguing that local production must be protected, Costa Rican sugar manufacturers demand that, in addition to the 45% common levy already charged on imported sugar, an additional tariff must be imposed.
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