Tonight, a brewing dispute continues to take shape in the northern sugar industry between the millers, ASR/BSI, and the Belize Sugar Cane Farmers Association. It involves the commercial agreement between BSI and this association of farmers. That's the business arrangement between the two sides which has governed the delivery and payment for sugar cane for the last 7 years.
2 days ago, Malcolm "Mac" McLachlan, ASR's Vice President of International Relations, wrote an open letter to farmers in the industry to alert them that the BSCFA opted to terminate the commercial agreement several months before it expired.
And the millers say that this act is cause for grave concerns in the industry since the next crop season will still start in a few months. As the biggest of the 4 cane farming associations, the BSCFA is responsible for half of the sugar cane that is delivered annually to the mill.
In his letter, McLachlan said, quote, "BSCFA farmers do not have a contract to deliver cane to BSI next crop. This action threatens to disrupt the industry at a time when it can least afford any kind of turmoil given the challenges of climate change, Covid-19, and global commodity market factors." End quote.
Now, you may remember the dispute between BSI and the BSCFA over bagasse. Back in the 2013/14 crop cycle and the 2014/15 cycle, the two sides could not agree on how revenues generated from the use of bagasse should be shared. That impasse caused the start of both crop seasons to start late, and the millers say that the industry lost 20 million dollars over it.
So, they are trying to head off another such stalemate for an industry that has had to weather some very tough years.
Today, we got a chance to speak with a representative of ASR/BSI on the termination of the agreement, and here's what he told us via Zoom Teleconference:
William Neal - Communications & Government Affairs Officer, ASR/BSI
"What we are afraid of is that when we had the negotiations 7 years ago, that we saw a delay in the start of the crop for 2 years, and it cost the industry approximately 20 million dollars. We feel that given all the challenges of climate change, COVID-19, and of course the market forces outside of the country, when you see a very low commodity price, we thought that this is not the best time to do that. The agreement itself serves the industry well. There's a value-share, and it's 65 [%] farmers and 35 [%] to the mill. We feel that perhaps, we could look at some amendments, but the core values of the agreement itself have been there for decades, and they have worked. To do anything else at this point would perhaps - we'd run the risk of actually having another delay or another disruption of the industry itself. And we just feel that this would not be in the best interest of any one of us. So, we've all been struggling in terms of making sure that we weather the storms of the low pricing and all the other challenges that we face. We just feel that this would not necessarily be the best time to go ahead and reopen the entire agreement to negotiations at this point."
"I guess the termination was the thing that was really jarring for us, and we would just prefer not to go there. I agree with you it is definitely their right to decide what they want to do, but equally, we have an option to exercise, and we would prefer to categorically state that we would prefer not to go into a renegotiation of the entire commercial agreement."
The BSCFA will host a press conference next week. But, they did send out a press release today to respond to that open letter. And, they pulled no punches against Mac McLachlan for his open letter. They accused him of attempting to initiate the very disruption he described in his letter.
The Association's Committee of Management said, quote, "...We are appalled by this open letter… It is nothing more than a shameless act of immoral coercion…The refusal of Mr. McLachlan and BSI to enter into any negotiation is a violation of our right to seek decent and fair terms and conditions for the sale of our sugar cane. May we remind Mr. McLachlan that we are not a British colony anymore and that his actions are tantamount to treating us as though we are subjects of BSI rather than business partners." End quote.
