Jamaica, like Barbados, has announced plans to overhaul the country’s sugar cane industry over the next decade, but at a cost of US$672 million, which is two-and-a-half times the cost estimates last week by Minister of Finance Owen Arthur during the budget presentation.

According to the Jamaica Observer, Jamaica Cabinet early in January approved a reform plan for the industry similar to the one planned for Barbados, that is, to grow enough sugar cane to produce three main products - raw sugar, molasses and ethanol.

Jamaica’s annual production targets are 200,000 tonnes for raw sugar and 130,000 tonnes of molasses by 2010. The country also wants to produce up to 70 million litres of hydrated ethanol per year from sugar cane.
 
However, according to Derrick Heaven, the chairman of Jamaica’s Sugar Industry Authority (SIA), the targets are based on market demand.

However, Allan Rickards, whose All-Island Jamaica Cane Farmers Association represents approximately 10,000 farmers and supply approximately 45 per cent of the cane delivered to the factories, believes that the administration has set its ambitions too low. He says that accepting those targets that would lead to factory closures.

After receiving recommendations from an EU consultant Prime Minister PJ Patterson late last year announced plans for the closure of two of the five factories operated by Sugar Company of Jamaica (SCJ) - Long Pond and Bernard Lodge. At present the state-owned SCJ produces about 60 per cent of Jamaica's sugar, but substantially less efficiently than the two privately-owned factories also operating in Jamaica.

Meanwhile, a privately-owned Brazilian sugar company has said that it is willing to bid for all five SCJ factories, which have been losing money for over twenty years, even during a period of private ownership in the 1990s.

Last year, the SCJ factories made a loss of just over $9 million US dollars from 181,000 metric tonnes of sugar - an improvement over 2003, when the company lost nearly $12.5 million US from 153,500 tonnes of sugar.