| Holly Sugar announced that they issued a final payment for
the 1999 crop earlier this week. The payment of $2.45 per ton was based on
an average sugar content of 16.21 percent. The total payment for the 1999
crop amounted to $35.89.
"We committed a good portion of the sugar early at a higher price,
which helped our net through the year," Holly Ag Manager Rick
Griffith said. "I felt the payment was good given the condition of
the sugar market today.
"We are still dealing with an oversupply, although the sugar
industry is still working to get the stuffed molasses issue closed and
negotiating the NAFTA agreement. It looks like down the road, sugar prices
should strengthen, but right now there is still too much sugar."
Over 1,600 growers for Western Sugar received their final payment for
the 1999 beet crop earlier this week as well.
The payment, totaling $2,292,171, represents 70 cents per ton based on
an average sugar content of 16.11 percent. This brings the total payment
for the 1999 crop to $127,224,397 for an average payment of $34.26 per
ton.
According to Kent Wimmer, director of agriculture for Western Sugar,
growers in Colorado and Nebraska won't receive a final check.
Wimmer explained the way the contract is structured, the payments are
based on the loan rate or No.14 raw sugar, whichever is higher.
When the initial payment for the crop is issued in November, growers
are paid 80 percent of the higher of the two amounts. In March, they are
issued a payment of 10 percent of the higher of the two amounts. The final
payment, based on the net selling price, is issued in October.
Wimmer said this year, the net selling price was less than the loan the
payment was indexed off of, resulting in a slight overpayment for Colorado
and Nebraska growers.
"We are finally seeing the results of the 30-year low sugar
prices," he explained.
Wimmer added growers in Montana and Wyoming had a lower loan rate and
averaged higher sugar than growers in Nebraska and Colorado.
Growers in all four states have invested with the company in capital
expenditures to improve marketing, packaging and storage. Wimmer said the
growers invest at a rate of 60 percent, while the company pays for the
other 40 percent. "The capital investment is deducted from the final
check," Wimmer said.
Growers in Colorado and Nebraska will have to repay their portion of
the capital expenditure costs when the initial payment for the 2000 crop
is issued later this month. Wimmer said the amount they owe will be
deducted from that check.
Wimmer and Griffith both said harvest is nearly complete, despite wet
conditions.
Wimmer reported growers in the Scottsbluff and Bayard areas are 93
percent finished and averaged 19.2 tons per acre and 15 percent sugar.
Jerry Darnell, senior agriculturist for Western Sugar, said Kimball,
Hartman, Mitchell, Scottsbluff factory, Mirage Flats and Hemingford
receiving stations remain open.
Griffith said Holly is 95 percent completed with harvest. "We have
approximately 700 acres of beets left to harvest."
Tonnage will average close to 20 tons per acre, with sugar averaging
15.6 percent.
Holly receiving stations in Alliance, Gering, Haig, Morrill and the
factory yard remain open. |