226 jobs cut as sugar producer J. Wray and Nephew faces rising production costs

J. Wray and Nephew Limited, operators of the Appleton Estate, revealed that 226 workers have lost their jobs. The company indicated that due to high operational costs, losses and severe dip in sugar prices, they had no choice but to close down the Holland Estate and the Casa Marantha Estate, both located in St. Elizabeth.

Chairman of J. Wray and Nephew, Mr. Clement Livingston, revealed that the company is seeking to make the redundancy process favorable for the laid-off workers by providing job training, alternative employment and scholarship opportunities for their children.

"J. Wray and Nephew is aware of the harsh economic conditions that the displaced workers may face and will put measures in place to help mitigate some of these realites. However, the challenges we face in sugar production are enormous and demand this kind of action", he said.

Mr. Lawrence hastened to add that: 

"This doesn't in any way, shape, or form signal any exiting from sugar. We're simply dealing with this area, which is least productive, most costly, most challenging and difficult for us when we did a broad-scale analysis to make that change to cauterise the losses. That, simply, is it." 

He confirmed that the company remained committed to Jamaica's sugar cane industry, evidenced by the recent multi-billion dollar investment in the Joy Spence Appleton Experience in St. Elizabeth. 

Giving insight into the factors that led to the job cuts, the Chairman explained that Holland is below sea level. 

"You have to pump water off the land. It takes electricity to operate those huge Farbus pumps, and so you can see right at the outset, it's challenging. And even areas that we have to irrigate, you don't irrigate with the same level of cost as it is to pump water off the land. So that really is the fundamental story surrounding our actions," he noted.


The issue was made worse because of several major factors that affect the sugar cane industry. In October 2017, preferential treatment was removed by the Europian Union, which no longer facilitates a guaranteed sugar quota from Jamaica and other Caribbean sugar cane producing countries. Also, Jamaica's sugar industry has still not been able to produce the precious commodity at cheaper production costs and so therefore dismally competes with other producers who have been able to produce greater yields more efficiently and cheaply. 

The J. Wray and Nephew Limited Chairman revealed: "The production of sugar cane has declined, and global purchasers have been able to purchase sugar at far lower prices than Jamaica has been able to support."

Over the years Jamaica's sugar industry has been plagued with issues that have hampered it from contributing more robustly to the economy. From the razing of the sugar cane to the harsh impact of climate change: severe drought to heavy flooding, the industry has suffered heavy losses.


Although the Holland and Marantha Estates will be closed, the world famous Appleton Estate will continue production. The factory will also continue to accept sugar cane from private famers and the New Yarmouth Sugar Estate.

J. Wray and Nephew and its subsidiary Appleton are owned by the renowned Italian alcohol beverages company Campari.



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References:
Investors Choice - http://icinsider.com/shocking-sugar-production/
The Gleaner - http://jamaica-gleaner.com/article/lead-stories/20180823/axed-more-200-jobs-cut-j-wray-nephew-shuts-down-sugar-operations-st
The Observer - http://www.jamaicaobserver.com/front-page/226-jobs-cut-j-wray-nephew-shuts-down-two-sugar-estates-in-response-to-heavy-losses-depressed-prices_142270




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