Tweet
Husseys make another half-billion bet on Long Pond
Published: Sunday | April 3, 2011 1 Comment
A front view of the Long Pond Estate in Clark's Town, Trelawny. The factory has a history of being the largest employer in the community and used to produce the famed Trelawny Gold Rum.
Mark Titus, Business Reporter
Hussey family, controlled Everglades Farms Limited is investing more than US$6 million (J$515 million) to modernise the Long Pond [COLOR=blue !important][COLOR=blue !important]sugar[/COLOR][/COLOR] estate that was shuttered after a disastrous start to its first year as a sugar manufacturer in the 2009-10 season.
Long Pond then churned 1,400 tonnes of sugar, easily the worst in the history of the plant.
Two years ago, Everglades acquired Long Pond in a package that includes the Hampden Estates, both located in Trelawny, but was forced to sit out the 2010-11 crop year after it was agreed that substantial work was needed in order to realise the potential capacity of the new assets.
"When we acquired the assets, it was in very bad condition, and we got no opportunity to see how it ran," Outman Hussey, Everglade's design and special projects manager, told Sunday Business in an interview on Wednesday.
"When we did take over, the first thing we saw that did not make sense was the oil usage," said Hussey, a director of the company and professor of architecture at Howard University.
"You could not supply Bunker C oil by a tanker fast enough ...".
Hussey said Everglades relied on the evaluation of the engineers from SCJ Holdings to diagnose the problem and come up with the solution solution, but came to regret that decision.
"Records will show that we did everything that was recommended to be done and more, but when we started the factory the following season it was very apparent that it was not going to happen," he said.
The Husseys, known mainly in tourism and horse-racing circles, brought in international experts and evaluators in the industry, and is now accepting bids for the engineering work to be done which will see Long Pond retrofitted to ensure that the factory can churn sugar cane throughout the season once commissioned.
The new crop year kicks off at around December.
"It is hard when you are used to doing business in a more private setting to come in a business that is constantly in the public domain, but we think we now have the right people in the right place to now do things the right way," a more reserved Andrew Hussey, also a director, said.
This will include returning the boilers to the design specifications that they were made for, and eliminating the use of oil at the factory, relying totally on bagasse.
Everglades' business plan goes beyond sugar production and calls for a diversified product: [COLOR=blue !important][COLOR=blue !important]rum[/COLOR][/COLOR] and tourism.
"In diversification, you have to look at what the region is, what the region has to offer, and what the resources are in terms of materials, lands, the people, and the skill level, and then you can determine the matrix," Andrew said.
Tourism is a key part of the company's plan, which details a tourism product that includes a rum museum for Hampden, a sugar cane museum for Clark's Town, and tours of the great houses and sugar cane mills now being refurbished. Horses are also being bred on the properties.
The family said their entry into sugar was easy, as the senior Hussey, Laurie, had been a cane farmer years ago, supplying the Bernard Lodge factory in St Catherine.
"Our dad does not want to see land waste, and what that has done for us as the younger ones is help us to see empty land as not good," said Andrew.
Everglades employs almost 40 persons on the estates' farms where crops such as cabbage, [COLOR=blue !important][COLOR=blue !important]lettuce[/COLOR][/COLOR], tomato, pak choi, sweet pepper, hot pepper, broccoli, cauliflower, zucchini, Irish [COLOR=blue !important][COLOR=blue !important]potato[/COLOR][/COLOR], string beans, carrot, sweet corn, pumpkin, sweet potato, [COLOR=blue !important][COLOR=blue !important]pineapple[/COLOR][/COLOR], cantaloupe, water melon, thyme, escallion, and onion are planted for the hospitality industry in Western Jamaica.
"In this model, you come to Everglades and there will be a number of different job opportunities, whether it is in rum, horses, sugar, or tours," said Outman.
"Sugar is very important in the mix of our diversified products because we will need sugar more now than before, especially good, organic sugar. And that is why the cane farmers must know that they are a very important part of our plans going forward. We will need their cane to complement ours to produce the quality sugar we intend for a proper return on our investment," he said.
The entire plan will be rolled out over a five to 10-year period. For now, the Husseys say the next milestone is packaging and marketing their own branded sugar.
The family says its sales of bulk rum to Europe are up 30 per cent since 2009, and they will be developing a warehouse for rum storage. They were unwilling to speak to the details of the project, however.
Hampden has launched a new spirit, Rum Fire, in partnership with Red Stripe Jamaica as its distributor. The Husseys hope to capture 20 per cent of the Jamaican rum market over time. The market is dominated by Wray and Nephew.
Both Hampden and Long Pond figured prominently during the heyday of sugar production in western Jamaica, and at one time, were chief sources of income for residents of Clark's Town and other Trelawny communities.
However, in the last two decades, sugar hit a steady decline and the estates and their equipment aged.
At the turn of this decade - the 2000-01 crop - the two factories produced a combined 20,000 tonnes of the sweetener, 5,000 tonnes of which came from the smaller estate, Hampden.
The tonnage, quoted by itself, tells little, but consider that just three years before, in 1997, Hampden alone, which had the capacity for 15,000 tonnes, was churning out 12,000 tonnes of sugar.
Despite the availability of some 1,284 hectares of land for planting cane, only 676 hectares were put into cultivation for the 2000-01 crop.
The estate, which was teetering on the brink of financial ruin and had been rescued by the Government in the 1990s under the bailout programme for the financial sector, would later be placed in receivership.
Before that time, the estate was controlled by the Farquharson family.
The records show that during the 1997-2002 period, Hampden sustained losses of more than J$45 million.
Long Pond and other sugar assets were last in private ownership under a deal in 1993 that gave 51 per cent control to a Wray and Nephew-led consortium, that included Cliff Cameron'sManufacturers Investment Limited and Booker Tate Limited of the United Kingdom.
Each private partner held 17 per cent, whereas the Jamaican Government retained a minority 49 per cent.
The state would eventually re-acquire the SCJ after the consortium failed to turn the company into a money-maker.
Under the deal with Everglades, the new owners must maintain 60 per cent of the leased lands for sugar-cane production or related products for 15 years.
The deal covers the two factories and surrounding 40 hectares of land, plus an additional 7,100 hectares, which are leased for US$40 per hectare per annum for the first 10 years of the agreement.
For 2010-11, the company has planted 5,000 hectares of new cane, and will plant an additional 1,408 hectares of cane over the four years to follow, which is projected to yield 280,000 tonnes of cane in the next five years.
"This means businesses in the communities will see an increase in trade, taxis will have more passengers to carry, and there will be additional opportunities for employment," said Outman.
"So in essence, we are mixing green infrastructure with traditional, infrastructure, and in that way, we are conducting a business while preserving the heritage." mark.titus@gleanerjm.com
Published: Sunday | April 3, 2011 1 Comment
A front view of the Long Pond Estate in Clark's Town, Trelawny. The factory has a history of being the largest employer in the community and used to produce the famed Trelawny Gold Rum.
Mark Titus, Business Reporter
Hussey family, controlled Everglades Farms Limited is investing more than US$6 million (J$515 million) to modernise the Long Pond [COLOR=blue !important][COLOR=blue !important]sugar[/COLOR][/COLOR] estate that was shuttered after a disastrous start to its first year as a sugar manufacturer in the 2009-10 season.
Long Pond then churned 1,400 tonnes of sugar, easily the worst in the history of the plant.
Two years ago, Everglades acquired Long Pond in a package that includes the Hampden Estates, both located in Trelawny, but was forced to sit out the 2010-11 crop year after it was agreed that substantial work was needed in order to realise the potential capacity of the new assets.
"When we acquired the assets, it was in very bad condition, and we got no opportunity to see how it ran," Outman Hussey, Everglade's design and special projects manager, told Sunday Business in an interview on Wednesday.
"When we did take over, the first thing we saw that did not make sense was the oil usage," said Hussey, a director of the company and professor of architecture at Howard University.
"You could not supply Bunker C oil by a tanker fast enough ...".
Hussey said Everglades relied on the evaluation of the engineers from SCJ Holdings to diagnose the problem and come up with the solution solution, but came to regret that decision.
"Records will show that we did everything that was recommended to be done and more, but when we started the factory the following season it was very apparent that it was not going to happen," he said.
The Husseys, known mainly in tourism and horse-racing circles, brought in international experts and evaluators in the industry, and is now accepting bids for the engineering work to be done which will see Long Pond retrofitted to ensure that the factory can churn sugar cane throughout the season once commissioned.
The new crop year kicks off at around December.
"It is hard when you are used to doing business in a more private setting to come in a business that is constantly in the public domain, but we think we now have the right people in the right place to now do things the right way," a more reserved Andrew Hussey, also a director, said.
This will include returning the boilers to the design specifications that they were made for, and eliminating the use of oil at the factory, relying totally on bagasse.
Everglades' business plan goes beyond sugar production and calls for a diversified product: [COLOR=blue !important][COLOR=blue !important]rum[/COLOR][/COLOR] and tourism.
"In diversification, you have to look at what the region is, what the region has to offer, and what the resources are in terms of materials, lands, the people, and the skill level, and then you can determine the matrix," Andrew said.
Tourism is a key part of the company's plan, which details a tourism product that includes a rum museum for Hampden, a sugar cane museum for Clark's Town, and tours of the great houses and sugar cane mills now being refurbished. Horses are also being bred on the properties.
The family said their entry into sugar was easy, as the senior Hussey, Laurie, had been a cane farmer years ago, supplying the Bernard Lodge factory in St Catherine.
"Our dad does not want to see land waste, and what that has done for us as the younger ones is help us to see empty land as not good," said Andrew.
Everglades employs almost 40 persons on the estates' farms where crops such as cabbage, [COLOR=blue !important][COLOR=blue !important]lettuce[/COLOR][/COLOR], tomato, pak choi, sweet pepper, hot pepper, broccoli, cauliflower, zucchini, Irish [COLOR=blue !important][COLOR=blue !important]potato[/COLOR][/COLOR], string beans, carrot, sweet corn, pumpkin, sweet potato, [COLOR=blue !important][COLOR=blue !important]pineapple[/COLOR][/COLOR], cantaloupe, water melon, thyme, escallion, and onion are planted for the hospitality industry in Western Jamaica.
"In this model, you come to Everglades and there will be a number of different job opportunities, whether it is in rum, horses, sugar, or tours," said Outman.
"Sugar is very important in the mix of our diversified products because we will need sugar more now than before, especially good, organic sugar. And that is why the cane farmers must know that they are a very important part of our plans going forward. We will need their cane to complement ours to produce the quality sugar we intend for a proper return on our investment," he said.
The entire plan will be rolled out over a five to 10-year period. For now, the Husseys say the next milestone is packaging and marketing their own branded sugar.
The family says its sales of bulk rum to Europe are up 30 per cent since 2009, and they will be developing a warehouse for rum storage. They were unwilling to speak to the details of the project, however.
Hampden has launched a new spirit, Rum Fire, in partnership with Red Stripe Jamaica as its distributor. The Husseys hope to capture 20 per cent of the Jamaican rum market over time. The market is dominated by Wray and Nephew.
Both Hampden and Long Pond figured prominently during the heyday of sugar production in western Jamaica, and at one time, were chief sources of income for residents of Clark's Town and other Trelawny communities.
However, in the last two decades, sugar hit a steady decline and the estates and their equipment aged.
At the turn of this decade - the 2000-01 crop - the two factories produced a combined 20,000 tonnes of the sweetener, 5,000 tonnes of which came from the smaller estate, Hampden.
The tonnage, quoted by itself, tells little, but consider that just three years before, in 1997, Hampden alone, which had the capacity for 15,000 tonnes, was churning out 12,000 tonnes of sugar.
Despite the availability of some 1,284 hectares of land for planting cane, only 676 hectares were put into cultivation for the 2000-01 crop.
The estate, which was teetering on the brink of financial ruin and had been rescued by the Government in the 1990s under the bailout programme for the financial sector, would later be placed in receivership.
Before that time, the estate was controlled by the Farquharson family.
The records show that during the 1997-2002 period, Hampden sustained losses of more than J$45 million.
Long Pond and other sugar assets were last in private ownership under a deal in 1993 that gave 51 per cent control to a Wray and Nephew-led consortium, that included Cliff Cameron'sManufacturers Investment Limited and Booker Tate Limited of the United Kingdom.
Each private partner held 17 per cent, whereas the Jamaican Government retained a minority 49 per cent.
The state would eventually re-acquire the SCJ after the consortium failed to turn the company into a money-maker.
Under the deal with Everglades, the new owners must maintain 60 per cent of the leased lands for sugar-cane production or related products for 15 years.
The deal covers the two factories and surrounding 40 hectares of land, plus an additional 7,100 hectares, which are leased for US$40 per hectare per annum for the first 10 years of the agreement.
For 2010-11, the company has planted 5,000 hectares of new cane, and will plant an additional 1,408 hectares of cane over the four years to follow, which is projected to yield 280,000 tonnes of cane in the next five years.
"This means businesses in the communities will see an increase in trade, taxis will have more passengers to carry, and there will be additional opportunities for employment," said Outman.
"So in essence, we are mixing green infrastructure with traditional, infrastructure, and in that way, we are conducting a business while preserving the heritage." mark.titus@gleanerjm.com