GuySuCo exploring increased savings, production from mechanisation -CEO

A move towards full mechanisation could cut GuySuCo’s production cost per tonne of cane sugar by over 75%, company Chief Executive Officer (CEO) Rajendra Singh yesterday told a parliamentary committee, while saying that the company is exploring varying means to reduce its operational costs while upping efficiency and mechanisation was one of them.

Using manual labour, GuySuCo spends US$4,723 ($991,830) to produce a tonne of cane sugar, while the figure would drop to US$1,062 ($223,020) if the company moved to full mechanisation, Singh also notes that if the company’s operations were sufficiently mechanised, it would be able to produce 600 tonnes of sugar per day at 35 to 40 tonnes per hour whereas it, using manual labour, produces 2.5 tonnes per day.

Singh delivered the figures while leading a team from GuySuCo which included Chief Financial Officer (CFO) Paul Bhim in a presentation before the Parliamentary Sectoral Economic Services Com-mittee yesterday.

Singh, however, admitted that the sugar company does not intend to mechanise fully, but to blend the option with manual labour. He pointed out though, that the option will be ideal to address the pervasive labour shortages gripping the company.

He said that the Uitvlugt Estate, which sees worker turn out of less than 50%, is particularly plagued by labour shortages and is constantly not able to meet goals as a result. This has led management to mechanise several operations at the estate and Singh says it is expected that the estate will begin to do better.

Some of the operations machines will now be assisting with is weeding, harvesting, planting and crop husbandry, Singh explained. He said that it is becoming increasing hard to find persons willing to do these jobs as times are changing and people no longer want to be engaged in these occupations.

Mechanisation has its own challenges, however, Singh admitted. He said the upfront cost would amount to around $6 billion and will take some time to fully implement. It will pay off in the long run, though, as he believes costs, at least in harvesting, will be reduced in about 3 to 4 years. He also said that it is imperative that the company retains its manual labour as the machines would not be able to work in the challenging weather conditions known to occur from time to time.

Citing another advantage, Singh said mechanisation will allow GuySuCo to increase the hectares on which it plants.

 Wrong plan

Meanwhile, Singh and the other GuySuCo top brass came in for severe criticism by members of the Committee after they were insufficiently prepared to provide information on the company’s 2013-2017 strategic plan during a scheduled presentation.

Members of the committee were provided with a strategic plan for GuySuCo in September of 2013 and A Partnership for National Unity (APNU) MP Carl Greenidge, who chairs the committee, said the main purpose of yesterday’s presentation was to discuss what was set out in the 2013 strategic plan.

However, as Singh went through his presentation Greenidge noted that the details were not related to the document he and the rest of the committee were supplied with. Singh then explained that the strategic plan had been revised since the initial plan was sent to the Sectoral Committee on Economic Services.

Singh said that after reviewing the level of investment being pumped into the company, it was determined that some of what was set out in the old strategic plan was unrealistic. Minister of Agriculture Dr Leslie Ramsammy was also at the meeting and he explained that the industry’s performance last year made it obvious that changes were needed.

He said that while the overall goal to have GuySuCo produce 350,000 tonnes of sugar annually by 2017 holds, there was need to alter the individual production targets across the five years.

APNU MP Ernest Elliot lamented that the committee members were at a disadvantage since, based on Singh’s explanation, it was not clear which of the documents they were supposed to work with.

He pointed out that GuySuCo provided one document and, without informing the committee, proceeded to make a presentation of a completely different document.

People’s Progressive Party Civic (PPP/C) MP Manzoor Nadir voiced his disappointment that Singh and his subordinates had gone to present on the strategic plan but failed to furnish the committee with copies of said revised plan.

Greenidge also did not hesitate to reproach Singh. He told him that the main reason the committee requested that GuySuCo make the presentation was so it could be briefed on the status of the company’s strategic plan. Greenidge also challenged Singh’s assertion that only specific year targets had been changed in the revised plan. He argued that such changes would also be accompanied by changes in the processes and plans to achieve the new figures. “We need to see the numbers and the supporting changes that are involved,” he said to Singh.

Lingering on the matter of the revised plan a while longer the chairman asked if the plan had been presented to, and approved by the past GuySuCo board of directors and learned that it was not. The changes were made prior to the expiration of the old board and Singh said the new board is yet to be installed. He told Greenidge that the revised plan will be presented to the new board as soon as it is installed, and expressed confidence that it will be accepted.

The committee members were still not impressed though, and continued to ridicule Singh and his subordinates for failing to provide some sort of documentation to support his presentation.

APNU MP Desmond Trotman complained that the committee was just “hearing about a revised strategic plan” but was seeing nothing to corroborate what was presented. He said there was no documentation of how the company planned to go forward or what anomalies would challenge its goals. He stated that the oral presentation was not doing much good towards answering those questions and eventually admitted that he was “on the street (sailing),” at which point he and his colleagues shared a laugh.

Alliance for Change (AFC) leader Khemraj Ramjattan did not spare Singh and his colleagues his criticism, although he was less sharp. He told GuySuCo’s representatives that the committee’s comments, whether they be criticisms or recommendations, will ultimately stem from whatever is set out in the strategic plan.

He explained that any recommendations made after considering the old strategic plan will be off point as its provisions do not inform the way forward for the company.

After absorbing the verbal blows, Singh told the committee that he would make the revised strategic plan available to the committee in as soon as two weeks as a board would have been installed in that time, and a decision taken. Ramjattan remarked that the committee would have no problem waiting until the board is apprised of the plan. As such, Singh and his colleagues are required to return before the committee to make the relevant presentation.

Last year President of the Guyana Agricultural and General Workers Union, Komal Chand and National Association of Agricultural, Commercial and Industrial Employees’ General Secretary Kenneth Joseph indicated that they were not in possession of the 2013-2014 plan although it would ultimately affect those they represent.

Chand had noted that since the initial plan a decision was taken to drop the sugar production target by 100,000 annually, taking it from the 2009 blueprint of 450,000 tonnes to 350,000 tonnes. He had told Stabroek News that the change, “demonstrates that the previous [plan was highly flawed… It identified a number that turned out to be far from achieving and even if you take out Skeldon from the equation that is beset with so many problems still you find that other estates were unable to produce what they said they would produce.”

Calling the plan “highly flawed,” Chand had pointed out that GuySuCo was struggling to make 204,000 tonnes of sugar by the end of 2013, a far cry from Ramsammy’s budget speech projection of 240,000 tonnes.

 

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