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New marketing agency agreement signed with PCSC in Jamaica

18 June 2012

According to reports from the Jamaica Information Service, an agency agreement was signed in May 2012 which gave the Chinese-owned Pan Caribbean Sugar Corporation (PCSC) ‘the right to market its own sugar, under the provisions of the Sugar Industry Control Act’. The Minister of Agriculture explained that for the next three crop years, ‘the rest of the industry will continue to pool their sugar in order to satisfy an agreement to supply Tate and Lyle of Britain with a specified quantity of sugar.’ This consists of two sugar estates not controlled by PCSC, and planters affiliated to the Jamaica Cane Farmers Association.

The Minister sought to reassure farmers that the dual marketing arrangement would not place them at a disadvantage, since the Sugar Industry Authority (SIA) would ‘independently verify the authenticity of whatever proceeds will be declared by Pan Caribbean’ and would ensure that PCSC used the ‘existing cane payment formula’. The Minister maintained that PCSC had ‘outlined specific proposals to allow for transparent and direct consultation with the cane farmers in relation to the marketing of its sugar’.

The CEO of PCSC meanwhile ‘gave an undertaking to work with the Cane Farmers Association to arrive at a mechanism that is transparent, efficient, and cost-effective’.

Editorial comment

Developments in the Jamaican sugar sector raise the wider issue of the future role of commodity boards and sector-specific parastatal bodies in an era of privatisation, globalisation and liberalisation. Indications of a shift to a supervisory function for the SIA, related to determining the proceeds to be shared with sugarcane producers and the regulation of relations between stakeholders in the supply chain, suggests a new role for such bodies.

Part of this new role may need to focus on elaborating a new modernised framework for the management of private-sector-based relationships along specific supply chains, in a context of vast inequalities in power relationships within supply chains and heightened global price volatility.

This experience, as it evolves, could well have wider relevance beyond the sugar sector and beyond Jamaica.

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