Jamaica seeks new buyer for gov't sugar estates

KINGSTON, Jamaica - Jamaica's government said Friday it is seeking a new buyer for its debt-ridden sugar company after the global financial crisis forced a Brazilian corporation to drop a multimillion-dollar deal.

Infinity Bio-Energy signed a $39 million agreement last year to lease Jamaica's sugar plantations for 25 years to produce up to 36 million gallons (135 million liters) of ethanol by 2013. Sugarcane production was expected to double to 2.5 million tons (2 million metric tons) as a result.

Jamaica had given Infinity until Jan. 31 to complete the deal after it missed two previous deadlines, Prime Minister Bruce Golding said. The government would have retained a 25 percent share in the company for three years.

An Infinity spokesman did not return requests for comment.

At least three of the five factories owned by The Sugar Company of Jamaica are still operating, though a fourth was closed for lack of operating money. It will reopen next week.

The factories have lost a total of $283 million since Jamaica bought them in 1998.

Agriculture Minister Christopher Tufton said the government cannot afford to operate them on a long-term basis given the economic crisis. The government also has warned it might not have enough money to keep buying sugarcane from farmers after the season is over.

Finding a buyer is critical because the jobs of thousands of workers are in limbo, said Alan Rickards, president of All Island Cane Farmers, a union that represents 8,000 workers.

The December-through-June sugar crop is projected at 165,000 tons (150,000 metric tons), of which 153,400 tons (140,000 metric tons) would be shipped to Britain by season's end. Most of the remaining sugar would be sold to the U.S., Rickards said.

Finding a new owner could mean a boost in production and more money for farmers, said John Plummer, 62, who has seen his annual sugarcane production drop from 7,800 tons (7,100 metric tons) to 2,200 tons (2,030 metric tons) in the last five years.

"It's largely because of the high costs of irrigation," he said. "It's becoming increasingly hard to pay bills."

He supplies sugarcane to the factory that is expected to open next week.

Jamaica and other Caribbean nations have recently sought to sell their fading, state-owned sugar companies to ethanol-producing corporations.

Infinity also had agreed to invest more than $200 million and start producing ethanol this year with Dominican Republic's Bioetanol Boca Chica SA. It is unclear if that agreement still stands.

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