A PROPOSED CANE PAYMENT FORMULA FOR FIJI

摘要

THE Fiji sugar industry is about to embark on a major industry restructure.Concurrent with the restructure is the anticipation of substantial change in the form of grower performance,miller performance and the price received from the sugar product.Key to the restructure is the introduction of a cane assessment system(CAS)and a cane payment formula(CPF).As is the case for many sugar industries worldwide,the Fiji industry is prevented from progressing commercially due to politics and the consequent mistrust between growers and the miller.FSC therefore chose to publish their proposed CPF to allow scrutiny of the underpinning principles and thereby provide some assurance to the growers of its technical soundness.The proposed CPF determines a base value for the performance of the grower and miller used to establish a base quantity of sugar to be distributed as per a pre-determined sharing ratio.Grower performance is expressed in terms of the pure obtainable cane sugar(POCS)as determined in Powell(1955).Miller performance is defined in terms of the coefficient of performance(COP)which is derived as the ratio of the obtained sucrose within the produced sugar and POCS.The remaining sugar produced(that above the base quantity) is distributed according to the achieved performance relative to the base level for both growers and the miller.The change in sugar production attributable to the simultaneous change in POCS and COP(?POCS x?COP)goes to the growers.Proceeds from the sale of molasses are split according to the distribution of sugar proceeds.Bagasse is available to the miller for post-processing.One of the main criticisms of payment systems existing around the world is that they become out of date,particularly in light of industry changes not envisaged at the time of negotiating the base sugar determinants (LMC Int.,1997).A feature of the proposed CPF,therefore,is the inclusion of dynamic base performance values.That is,the parameters that define the stakeholders performance levels used to calculate sugar ownership,are rolling averages over an agreed number of years.The number of averaging years may differ for the miller and growers.A sensitivity analysis performed to determine miller-grower equity and grower-grower equity for various scenarios shows that the proposed CFP is able to: adjust to suit the anticipated changes in the economic environment;compensate stakeholders for anomalies such as for poor crops due to severe weather;provide incentive to growers and millers to improve,and subsequently maintain,performance levels;and adjust for changes in performance level which is outside the control of the stakeholders,such as the introduction of mechanical harvesting and/or loading.