Looking for a Resurgence in Cane Farming

With rows of sugarcane standing tall beside him, Lonnie Champagne, general manager of Louisiana Sugar Growers and Refiners, Inc., sees a new era ahead for farmers of this Louisiana mainstay crop. He looks forward to the day when young producers get back into the business, believing Louisiana Sugar Refining, LLC – or LSR as it’s known locally – just might help make that a reality. “Farming cane in Louisiana is a tough business. And like the rest of the agricultural community, we’ve seen young farmers and ranchers fleeing the farms for better pay and less hours,” says Champagne. “We probably have the longest, toughest season of harvesting I can think of – starting around October 1 and extending through December 31.” Sugar Growers and Refiners is an agricultural marketing cooperative of eight sugarcane mills and 725 cane growers in 23 parishes of southern Louisiana. It’s involved in the marketing of raw sugar and molasses, annually producing about 950,000 tons of sugar – nearly two billion pounds. The cane produced on 450,000 acres of Louisiana farmland is delivered to area sugar mills. There, the cane is crushed, the juices are extracted and the sugar is crystallized. The sugar is then stored in warehouses throughout the state. Sugar refiners, such as Imperial Sugar Company (ISC), draw from these warehouses and convert the raw sugar into the familiar sugar products used in kitchens everywhere. According to Champagne, cane farming requires a significant capital investment in specialized equipment to harvest and deliver the crop. He says the higher prices in sugar during the last couple of years have helped farmers catch up economically and repair their balance sheets. “It’s the first opportunity our growers have had in the last 20 years to replace tractors, pay off debt and put themselves on a better footing,” says Champagne. Sugarcane has been produced in Louisiana for more than 225 years, with families passing down their farms for multiple generations. November 2009 marked the beginning of a new era for Louisiana sugar growers and producers. A joint venture formed among Imperial Sugar Company, Cargill and Sugar Growers and Refiners will bring about the first large-scale integration of growers, mills and refiners – enabling farmers to participate in the marketing and profits of refined sugar. Champagne says his organization decided 10 years ago to pursue a vertical integration model, and though it took a long time, “it was well worth it.” The venture will result in a new sugar refinery, which has been under construction since the end of last year. It’s planned for completion in late spring or early summer 2011. The new facility is located in Gramercy, La., next to ISC’s existing refinery. Pointing to stalks of sugarcane reaching 10 feet in height, Champagne says the cane growing on farms today will likely provide some of the first raw sugar to be processed in the new refinery. “This year started out with a hard winter and a dry spring, which allowed our producers to get into the fields early and do their work – and the cane has been growing ever since,” he points out. Champagne hopes the LSR venture will secure the future for the next generation of growers and bring “a resurgence of young producers in south Louisiana.”

LSR Refinery Construction Gets National Media Attention

Associated Press reporter Alan Sayre, based in New Orleans, reports on the new LSR cane sugar refinery currently under construction at Gramercy, Louisiana. The Washington Post and ABC Business News are among the national media to carry the story:

NEW ORLEANS — After years of fighting storms and flat prices, Louisiana sugar cane growers at the heart of a $2 billion industry are hoping for better financial times as farmers and the food industry unite to get the product from the fields to the consumer in a direct line.

Construction is under way on a $190 million sugar refinery near Gramercy, northwest of New Orleans, that will be able to produce 1 million tons of sugar annually. In a joint venture with two food giants – Cargill Inc. and the Imperial Sugar Co. – growers say the refinery, expected to begin processing in 2011, will give them a steady market for Louisiana cane that will support higher prices.

It’s the first time state growers have been involved in such a field-to-consumer venture. For Cargill, it will provided the company’s first entry into the processed sugar market.

“Sugar is a critical ingredient to the customers we already serve. It enables us to work more effectively with a broader base of customers on ingredient innovations,” Cargill spokeswoman Nicole Reichert said.

Also a partner in the refinery is Sugar Growers and Refiners Inc., a marketing cooperative consisting of 700 Louisiana cane growers and eight cane mills.