In 2022, industrialist Tereos was solely responsible for the delay in negotiating the Convention canne, the document that sets the selling price of sugar cane for farmers. Tereos is the sole buyer of sugar cane planted on La Réunion. It therefore has a monopoly. And for Tereos, there’s no question of increasing a price that hasn’t changed in over 20 years. This price is based on a calculation formula that dates back to a time when cultivation practices, cutting and industry yields were very different from today.
CGPER is leading the battle to challenge this calculation formula, which is the source of many problems for farmers. In effect, it allows manufacturers to pay virtually the same for their raw materials. The increase in production costs is covered by the French State and the European Union.

Deliveries increase, revenues decrease

The desire to produce more electricity from the farmers’ own sugar cane has further complicated matters. These new varieties contain more fiber for more energy, but have a lower sugar content. The quantity of sugar remains the same or even higher, but the mass delivered has increased considerably. As a result, manufacturers are able to acquire their raw materials even more cheaply.
As drought set in, yields dropped. Irrigation costs rise. Input costs followed the same trend. In these conditions, public subsidies serve only to compensate. But farmers’ purchasing power is not increasing - quite the contrary.
It’s hardly surprising that these conditions should lead to a decline in the number of farmers and in the area planted with cane. This runs counter to the public authorities’ desire to boost production in the cane-sugar-alcohol-energy sector.
To remedy this situation, we need transparency on the profits made from sugarcane. The information presented by Tereos during the negotiations is far from sufficient. How much is earned on a tonne of sugar cane?

Without planters, there’s no sugar cane and therefore no profit.

Secondly, it is important that the grower is the main beneficiary of these valuations. Without planters, there’s no sugarcane, and therefore no profit.
In other words, we need to go back to the drawing board. Like any professional, a planter must be able to make a decent living from his production. Their buyers must pay a fair price, which takes into account the rising cost of production. Government intervention would then be a one-off and would no longer constitute the majority of farmers’ income.
That’s why communication about new, more productive varieties must not obscure the essential point: the crisis in the industry stems from an opaque and therefore unfair distribution of profits from La Réunion Island’s production.

M.M.