Thursday 28th February, 2008

 

Upgrade for SMCL’s sugar refinery

 
 
 
 
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BY SANDRA CHOUTHI

[email protected]

Ken Marshall, chief executive officer of the Sugar Manufacturing Company Ltd (SMCL), wants to increase the state-owned entity’s refining capacity.

The Ste Madeleine refinery currently produces 60,000 tonnes of white or granulated sugar.

Marshall wants to raise that to 100,000 tonnes.

T&T consumes 80,000 tonnes of white and brown sugar combined. The Caricom market —excluding Haiti—uses about 200,000 tonnes of sugar, Marshall said.

“The demand is there.”

Upgrading the 1983-commissioned refinery, expected to cost under $10 million, is still being conceptualised, but Marshall said it will involve adding a vacuum pan—which refines the sugar—and pumps.

The board must approve the plans for the upgrade before it is submitted to Cabinet for approval.

SMCL, formed in 2003, bought 334,000 tonnes of cane from 3,000 farmers at $205 a tonne last year and exported 25,000 tonnes of white sugar made from cane grown in Trinidad.

Marshall said SMCL imports 45,000 tonnes of sugar from Caricom, either from Guyana or Belize.

For the last two years, though, those countries have been unable to provide an adequate supply.

“So you go to the Caricom Secretariat and get the okay to go extra-regional.

“Last year, a lot of the sugar came out of Cuba. We had one shipment of brown sugar from Honduras, 6,000 tonnes,” he said.

He said all the sugar SMCL makes from locally grown cane is exported to the European Union under preferential rates.

SMCL bought brown sugar on the futures market at US$311 a tonne. Last year it exported refined sugar to the European Union, which paid 495 euros a tonne.

“So it made sense exporting the sugar and getting a preferential rate; then buy (brown) sugar on the world market to make white sugar. It’s straight money.”

Keeping the refinery

Marshall said he thought it was a good idea that the Government chose to keep the refinery as sugar supports T&T’s food and beverage sector, a huge driver of growth in the manufacturing sector.

“It makes sense keeping it rather than exposing the food and beverage (sector) to the vagaries of the market.

“Sugar is a big industry worldwide, a huge industry. Just as huge as fertiliser. Probably the only thing that’s bigger than the sugar industry worldwide is the arms trade, and maybe drugs.

“The world produces 170 million tonnes of sugar a year.”

SMCL’s customers

SMCL supplies white sugar to Kiss Baking Company Ltd, Caribbean Bottlers (T&T) Ltd and biscuit manufacturers.

SM Jaleel and Company Ltd was its biggest customer until the country ran out of sugar in 2005 and the soft drink manufacturer got a licence to import its own supply of sugar.

“They buy sometimes from Colombia. I’m trying to win him back. We’re talking to him,” Marshall said, referring to SM Jaleel’s boss, Dr Aleem Mohammed.

“I really want to get back Jaleel because Jaleel is a big customer. If I could get back Jaleel, my biggest customer would be Jaleel. After Jaleel, it’s Bottlers.”

work background

Marshall is a petroleum engineer by profession.

He took voluntary separation of employment (VSEP) from his last employer, PCS Nitrogen.

“It was good,” said Marshall, 56, with a laugh, of PCS Nitrogen’s VSEP package.

“Pt Lisas pays well; the energy sector pays well.”

One of the last projects he worked on at PCS before taking VSEP was reducing the plant’s energy cost. That is, reducing the amount of energy used to make one tonne of urea.

“You look at the ammonia to urea ratio, so you take less ammonia, so you put in scrubbers and so on to recapture the ammonia so you could put it back in the process.”

Making SMCL more efficient

Marshall intends to put some of his proactive energy sector experience to use at SMCL.

For instance, he considers the company’s last monthly water bill, $135,000, too high, though it’s been reduced by 70 per cent.

“We aggressively repair leaks. There is some usage right now that’s going down the drain.

“What we need to do is recover it, pass it back through the treatments so you can use it again.

“When I came here, it did not matter that water was going down the drain. Water is $3.50 a cubic metre. You can’t waste it.”

Re-establishing sugar

He’d also like to see the electricity bill reduced, which would require changing transformers.

“That would do good for the refinery.”

Upgrading the refinery would certainly reduce SMCL’s gas bill.

“The boiler is a small boiler, but when you look at the amount of natural gas it uses, it’s too much.

“Right now, what I’m looking at is to change out the burners with a high efficiency burner, so you get down the gas bill.

“If there’s a steam leak, you need to fix it because that is money going into the atmosphere. Steam is energy. We pay US$1.70 a million metric British thermal units (mmbtu).

“You can’t afford a steam leak or you can’t afford for the juice tank to overflow. It has happened where the juice tank overflowed. That’s sugar going down the drain. It shouldn’t go at all. When it overflows, that’s your money going down the drain. That’s sugar that should be exported. Then there’s an environmental issue because that gets down the river and stinks.”

Once the efficiencies are achieved, Marshall’s next goals are to increase Ste Madeleine’s production and re-establish SMCL sugar as a brand in T&T and throughout Caricom.

“And we are getting there,” he said on an optimistic note.

©2005-2006 Trinidad Publishing Company Limited

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