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 imported sugar.
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%.
Scheduling medical checkups for the staff, preparing the housing modules to maintain social distance and adapting the logistics of transporting people are challenges that the sugar mills will face during the 2020-2021 harvest.
The sugar cane harvest that is about to begin represents a source of employment for thousands of people in the region and in this context of the propagation of covid-19, the companies will have to face multiple challenges to get the harvest going.
Since the pilot plan to test the efficiency of ethanol use in gasoline in Guatemala has yielded the first positive results, the authorities plan to present a bill to regulate its use in the first quarter of 2021.
After the Costa Rican authorities raised the tariff on imported sugar from 45% to 73%, the South American country decided to raise before the World Trade Organization, a process to exercise the right of suspension.
In June of this year, the Alvarado administration decided to increase to 79% and for the term of three years, the tariff on sugar entering the country.
In 2014 and 2015 a pilot plan was already carried out in Guatemala, which will be resumed for 10 weeks, a period in which tests will be carried out to mix 5% to 10% ethanol, in the different gasoline that are consumed locally.
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.
Salvadoran businessmen assure that for now the sector has not been impacted by the propagation of covid-19, since for the next few weeks they are preparing shipments for 70 thousand tons of sugar.
In a turbulent context, caused by the global spread of covid-19, Salvadoran sugar producers are in the middle of the harvest period and are preparing significant shipments of their product, they remain on alert.
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.
In Costa Rica, sugar producers are asking the government to raise tariffs or entry taxes on imports, and importers are opposing, as this would raise the final price to the consumer.
In July 2019, the Sugar Cane Industrial Agricultural League (LAICA) asked the Ministry of Economy, Industry and Commerce (MEIC) to launch an investigation with the aim of imposing additional tariffs on imported sugar, arguing that purchases from abroad would damage local production.
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