11 Aug 2009

Low production stops Fiji from benefitting from sugar price rise

1:00 pm on 11 August 2009

The low level of sugar production in Fiji is holding the country back from benefiting from an increase in the global price of raw sugar.

The price has risen more than 80 percent in the past six months to its highest level in 28 years, as supply concerns grow due to greater demand in Brazil and a sharp fall in production in India.

The former Chairman of the now dissolved Fiji Sugar Marketing Corporation, John May, says Fiji's sugar production levels have declined so much it cannot meet demand from countries outside the Pacific region.

He says the government is pushing plans to reverse the problem, by building confidence in the industry through replanting.

"The decline in our sugar production means that we are not able to take advantage of the high prices immediately. And the history of peaks in sugar prices tell us that they do not last very long."

John May says it could be two years before the industry reaches its target of producing 3.5 million tonnes a season to supply to its European buyers and markets around the world.