By Patricia Grogg
HAVANA, Jun 26 2001 (IPS)

A sugarcane harvest that failed to meet government forecasts has once again postponed Cuba’s hopes for the recovery of a sector that has historically been the engine of the Caribbean island’s economy.

Ulises Rosales del Toro, Cuba’s Sugar minister, stated that “nearly” 3.6 million tons of the commodity were produced this year, while predictions had been for 3.7 million tons.

Rosales del Toro’s report is so far the only official data publicised on the latest harvest, which began in early December 2000 and was to conclude in May 2001 at the latest.

Nevertheless, the figure surpasses the forecasts of some experts, who calculated that the maximum production would be 3.5 million tons, putting the 2000-2001 season among the lowest since 1993-1994.

These tenth-of-a-point disparities have profound consequences for the economy of this island-nation of 11 million people.

Adverse climatic phenomenon, low yields and interruptions in the processing phase reportedly hurt this season’s harvest. Just 104 of Cuba’s 156 sugar mills were used, compared to the previous season, in which 110 were operating and cut productions costs considerably.

“The strategy is to produce at lower costs and to achieve diversification,” a government expert, supporter of policies to increase the added value of sugarcane, told IPS.

For the Sugar minister, the island’s sugar production could reach six million tons in the near future. This sector, despite its ups and downs, remains a strategic one for the Cuban economy.

After hitting bottom in 1998, with a harvest that failed to reach 3.2 million tons, the last season (1999-2001) hit 4.59 million tons.

The Central Bank of Cuba reported late last year that the revenues obtained from sugar sales totalled 450 million dollars for 2000. With the production of 3.7 million tons, the country’s sugar income for 2001 is expected to be approximately 550 million dollars.

The prediction of increased revenues despite the lower tonnage is due to the higher quality of the sugar, according to the Cuban government, and to better prices on the international market.

“We maintained and improved” some factors of efficiency and, more importantly, the prices increased, commented Rosales del Toro.

The value of Cuba’s sugar exports fell dramatically after the loss in the early 1990s of its agreements with the now-defunct socialist bloc, a market that had proven secure and had offered preferential prices.

Sugar sales to the former Soviet Union and other Eastern bloc countries – at prices that reached 690 dollars a ton – averaged four million tons annually and represented 56 percent of the island’s sugar exports in 1989.

But, at equal volumes, revenues from sugar sales to the same countries dropped to less than half due to the prevailing prices on world markets in 1990.

From 2.76 billion dollars, income fell to approximately 1.1 billion dollars that year, and slipped further to 800 million dollars in 1991, according the Economic Commission for Latin America and the Caribbean (ECLAC).

As a result of the decline in international prices, the total value of Cuban sugar exports plummeted from nearly 4.34 billion dollars in 1990 to 718 million in 1995, says an ECLAC study on the Cuban economy.

Cuba sells an average of 85 percent of its sugar production on the open market, where it competes with the substantial production and trade subsidies for European-produced beet sugar, pointed out ECLAC, a regional agency of the United Nations.

Tourism has now replaced sugar as the island-nation’s leading source of revenues, growing 10 percent last year and providing some 600 million dollars in income.

Similar figures were seen in Cuba’s sales of nickel, the output of which is expected to reach 75,000 tons this year.

Cuba has an existing capacity to produce 10 million tons of sugar a year, and throughout the 1980s, saw harvests averaging seven million tons.

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