A Lost Decade for Cuban Sugar

By Pilar Montes

HAVANA TIMES — Cuba’s proud sugar industry, once the locomotive of the country’s economy, powerful enough to produce a popular saying (“no sugar, no country”), now struggles to come out of the coma it’s been in for the past decade.

Through its webpage, Cuba’s sugar company conglomerate Azcuba announced that, by mid-April (or 57 days ahead of schedule) the volume of sugar produced that same month last year had been surpassed.

To add to the news’ dramatic impact, the official government source declared that the output of the 50 sugar refineries that were processing sugar during the present harvest (a total of 56 facilities) is the largest reported over the past 11 years.

Only 10 of the 50 refineries have fulfilled their production plans to date. Some of those that have are among the country’s largest refineries, such as Holguin’s Urbano Noris, Ciego de Avila’s Ciro Redondo and Primero de Enero and Sancti Spiritus’ Uruguay, among others.

The output is still well beneath the eight million tons of sugar produced in the 1970s and 1980s, when the country received fuel, trucks, tractors and many harvesters from the Soviet Union and other socialist countries.

The sugar derivatives industry experienced significant development prior to the Special Period crisis that began in the ‘90s, but it started to decline when many sugar refineries were shut down owing to low agricultural and industrial output and domestic production left the population and manufacturers of derivatives without sufficient sugar.

Currently, 10 refineries, 12 distilleries, three C02 plants and two glucose and fructuose plants are being used to produce Azcuba statistics, for a total installed capacity of 53 Gw, 35 animal feed plants, 16 rum factories, two bagasse board manufacturers and a sorbitol facility.

Cuba’s central provinces – Sancti Spiritus, Cienfuegos and Villa Clara – report the highest industrial performance indexes (11.14, 10.88 and 10.57, respectively).

According to the Cuban website EcuRed, from 1962 to the 1990s, Cuba’s sugar industry reported significant growth, when agricultural output doubled and played an important role in guaranteeing the availability of productive agricultural and industrial supplies and a whole series of measures incentivized producers in the sector.

The 1970 goal of producing 10 million tons of sugar was not reached, though the highest level of sugar produced in a single year (around 8.5 million tons) was reached.

Until 1990, the sugar industry had a catalyzing influence on the Cuban economy, particularly the industrial sector.

At the close of the 1980s, this industry accounted for 14 percent of the country’s commercial production, impelled production in 20 percent of the mechanical industry, 13 percent of basic industry and 8 percent of light industry.

According to a study by economist Hiram Marquetti (researcher for the Cuban Economy Studies Center) published in 2001, by 1995, the country had experienced an evident drop in production, though the following harvest constituted something of a recovery, with 4.4 million tons. By the end of the 90s, sugar production had fallen beneath 4 million tons, until reaching the 1.1 million ton low reported in 2009 and 2010.
This situation was coupled with a significant drop in sugar prices on the international market and the dissolution of Cuba’s main importing market, that of the USSR and other socialist countries.

The loss of these markets had a negative impact on the country, reducing its GDP by 35 percent. This situation was exacerbated by the economic impact of the US blockade, which made the first half of the 1990s even more difficult economically.

Now, the country seeks to reinvigorate the industry by introducing cooperatives and other non-State forms of management in the sector, opening the industry to foreign capital under the new foreign investment law.

It is estimated that the 2013-2014 harvest yielded 2.2 million tons of sugar, and this year Azcuba foresees a harvest with an output 4.2 percent higher than the previous (nearly 2.3 million tons).

During the severe cutbacks implemented over the past decade, however, the country lost valuable sugar industry experts and workers (who emigrated to the large cities or abroad), and the liveliness of Cuba’s former refinery towns has all but disappeared.