Beet growers looking at marketing options

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Southern Alberta sugar beet growers have been unanimous in their support of their marketing group in their negotiations with Rogers Sugar, but in the long run they want to see more marketing options.

The Rogers Sugar factory is the only plant producing sugar from beets in Canada. Its parent company, Lantic Inc. also owns cane-based plants in Vancouver and Montreal.

Sugar production from beets is limited to fall and winter because spring temperatures cause stored beets to lose their sugar content as they respire. Beets are stored in straw-covered piles with vented plastic pipes to keep them at temperatures close to freezing and minimize respiration. The Rogers plant extends its operating period by storing “juice,” a hot molasses beet extract that is an intermediate in sugar production. The company can crystallize sugar out of this product when temperatures are too high for safe storage of beets.

Today’s corporate investment rules don’t generally support facilities that only generate product seven or eight months of the year, no matter how efficiently they run.

Beet growers in southern Ontario have an alternative — they’re part of a 10-year-old co-op in the U.S., Michigan Sugar. Each share in the co-op entitles and obliges a grower to deliver beets from one acre per share to the co-op plant.

Co-op director Mark Richards of Dresden, northwest of Chatham, Ontario, says taking beets across the border for processing is not a problem.

“We pile our early-harvest beets at the end of the field and a commercial carrier picks them up within four days,” he says. “We have no real problems at the border. Our drivers have passes and the trucks pass through an X-ray machine that checks the load.”

Richards says improved plant management has put more money into shareholders’ pockets. “We’ve invested in maintenance and updated the machinery in the plant,” he says. “We treat it like our own business, making all our decisions to maximize efficiency. It’s paid off in spades.”

Better markups

About half the co-op plant’s production is white sugar for retail sale, the other half is sold as industrial bulk product. Recently, the co-op has been producing powdered (icing) sugar and buying cane sugar to produce brown sugar. Both have much better markups than regular white sugar, and boost returns to growers.

“Our gross prepayment is over $80 a ton compared to $35 before we formed the co-op,” says Richards. “Even if you update that to $50, we’re still doing a lot better owning the plant.”

Gerald Third, executive director of the Alberta Sugar Beet Growers, has been looking into alternative marketing options for beet growers. He’s particularly interested about the potential to use industrial beets as feedstock for crop-based chemical production such as butanol, which can be polymerized into plastics for biodegradable pop bottles. It is also a biofuel that blends easily with gasoline and doesn’t absorb water as ethanol does.

“There’s a lot of potential, but we’ll need to do more research and look hard at the financial viability of a plant based on industrial sugars.”

Third would also like to see world sugar trade opened up, so Canadian farmers could sell into the U.S. and other markets when there is a shortfall in world markets. “We just want to be able to compete.”

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