Low Prices and Taxes Make Sugar Industry Difficult

The outlook for sugar producers in Nicaragua is complex, since they must face a fall in international prices, coupled with rising operating costs at the local level.

Tuesday, September 17, 2019

According to international reports, from January 2018 to September 2019, the average price of a quintal of sugar has remained below $14, even dropping to $10.46 in August 2018.

You may be interested in “Crops in Central America: Main Figures in 2018

José Antonio Mayorga, president of the Association of Private Sugarcane Producers of the West (Aprico), explained to Elnuevodiario.com.ni that “… the price they receive per ton of cane is linked to the international price of sugar, therefore, this fall is affecting the guild. The prices we are currently having are the lowest in recent years.

The drop in international prices is reflected in the fall in export value, since between January and August Nicaraguan sales abroad totaled $134 million, a figure that is 16% lower than that reported in the same period of 2018.

Mayorga added that “… on the other hand, producers are being hit by the increase in the price of agricultural inputs, because of the tax reform that was approved earlier this year.

Sugarcane growers are not the first to complain about this situation, since weeks ago banana growers explained that before the Tax Concentration Law approved at the end of February of this year was reformed, agricultural inputs were exempt from 15% Value Added Tax. However, with the changes, costs have increased considerably.”

Article source.