Interview with Arvin Boolell, Minister of Agro-Industry: "The Added Value of Our Products is Essential"
In an interview with Arvin Boolell, the Minister of Agro-Industry, he discusses the challenges faced by the sugar industry, including plummeting global prices, abandoned fields, and labor shortages. Despite these issues, he is determined to present a strategy to save this historic sector.
In light of the recent decline in sugar prices on the global market, what strategy will the Ministry of Agro-Industry adopt to protect the Mauritian sugar industry and prevent another crisis?
The price of sugar, like other agricultural commodities, is subject to cycles driven by supply and demand. After years of relatively high prices, global producers have increased their production capacity, leading to an oversupply in the market. Currently, the price of raw sugar is around US 16 cents per pound, or approximately Rs 16,000 per tonne, which remains unattractive for most producers.
In Mauritius, the Mauritius Sugar Syndicate is mitigating the effects of this drop by focusing on the marketing of value-added sugars, including white sugar and specialty sugars, as well as diversifying export markets. Access to markets in the European Union, India, China, the Southern African Customs Union (SACU), and the United States through free trade agreements is available, but the added value to our products, to develop our specialty sugars under a recognized brand, is essential.
It is crucial for the various stakeholders in the sector, including producers, planters, and millers, to continue improving their efficiency to better cope with price volatility.
What concrete measures will be implemented to encourage planters to replant sugarcane, given that many have abandoned it due to reduced profitability?
Several initiatives have been launched to revive sugarcane replanting. Planters producing up to 60 tonnes of sugar will now benefit from a guaranteed income of Rs 35,000 per tonne, which also includes income from bagasse and molasses. The government is committed to producing up to 300,000 tonnes of sugar for export.
Moreover, the price of bagasse used for electricity production, set at Rs 3.50 per kilowatt-hour, needs to be revised. Should planters continue to cede 22% of the bagasse to factory owners? These issues must be addressed to also consolidate the multifunctional aspect of the sugarcane industry.
A replanting scheme has been established with a budget of Rs 75 million aimed at supporting small and medium planters operating up to 15 hectares. This measure aims to replant around 600 hectares, with the goal of increasing sector productivity.
For the 2025-2026 year, planters producing up to 60 tonnes will also be exempt from paying the SIF premium, representing an additional estimated support of Rs 80 million.
The price of bagasse used for electricity production, set at Rs 3.50 per kilowatt-hour, needs to be revised.
We are also launching a new program, the Innovative Mauritius Scheme, aimed at encouraging research and development. This project will enable the Mauritius Sugarcane Industry Research Institute (MSIRI) to develop new high-yield sugarcane varieties that are better adapted to climate change effects and generate more biomass for renewable energy production.
A budget of Rs 2 million is also allocated to research on organic agriculture and soil fertility, to promote reduced use of inorganic inputs and encourage more sustainable agricultural practices.
The use of drones for agricultural spraying will also be enhanced with funding of Rs 3 million. This technology can reduce application costs by 30 to 60% compared to traditional methods while increasing sugar extraction rates by 7 to 9 kg per tonne of cane, resulting in a direct increase in income.
However, pilots wish to operate larger drones to achieve economies of scale and are awaiting a favorable response from the Civil Aviation Authority.
Finally, to address the labor shortage, the government is finalizing a policy for recruiting foreign workers and skills. This measure will be implemented through a simplified work permit system managed by the Economic Development Board. Initially, around 1,000 foreign workers will be recruited as part of a collaboration between my ministry and the Mauritius Cane Industry Authority.
Is the ministry considering revising financial support mechanisms (subsidies, guaranteed minimum prices, access to credit) to restore confidence among planters?
Yes, taking into account feedback from planters and measures already implemented under the budget, the government is currently exploring alternatives in the form of new adapted schemes, which will be proposed in the next budget cycle. Our policy focuses on performance, and incentives are under review to support sugarcane planters.
Is there a willingness to accelerate the diversification of cane-derived products (bioenergy, ethanol, specialty sugars) to reduce dependence on global market fluctuations?
Diversifying sugar production is indeed a strategic priority. We are particularly focusing on value-added sugars, whether specialty sugars or refined white sugar for niche markets that offer better prices. These products already account for more than 55% of local production, and our goal is to continue increasing this proportion to stabilize sector revenues while reducing dependence on traditional and volatile markets.
We are also making significant progress in the production of high-quality rum, which is highly sought after in the market.
How does the government plan to ensure that the added value generated by the sugar industry benefits planters more and not just the major players in the sector?
All revenues from the sale of sugar, including those from value-added sugars, are centralized by the Mauritius Sugar Syndicate, which then redistributes them to all producers after deducting common costs. These costs include bag expenses, maritime freight, storage, and the manufacturing premium paid to factories and the refinery for processing raw sugar into white or specialty sugar.
This premium is justified by the additional investments and operational costs required for producing these specific sugars. It is set transparently, after validation by the Mauritius Sugar Syndicate committee, which includes representatives from both planters and millers.
It is also important to highlight that the sharing ratio between planters and millers is 78% for planters and 22% for millers. This is the highest rate in the world, clearly showing that we ensure planters maximize the value created by the entire sugarcane sector.