Imperial Sugar expects rebuilt refinery to recoup custom

Mexican imports and rival US companies filled the supply gap when the refinery in Georgia closed for business following an industrial accident that severely damaged the packaging facilities and left 4 people dead.

But now that Imperial Sugar has rebuilt the refinery, senior vice president and CFO Hal Mechler told Food Navigator USA that he is confident that customers will return.

Mexican role​

Mechler said that Mexican imports had filled most of the supply gap created by the refinery closure. He said imports from the country rose from about 2 percent of the US market in 2007 to 10-11 percent today.

With a smaller Mexican sugar crop anticipated this year, the Imperial Sugar executive said the company expects the Mexican supply contribution to fall back to around 2 percent.

As the Port Wentworth refinery returns to full production capacity Imperial Sugar expects to be able to step in and supply the difference to sugar users.

Operating the Port Wentworth refinery and another refinery in Gramercy, LA, Imperial Sugar is one of the largest processors and marketers of refined sugar to food manufacturers in the US.

Sugar prices​

Its operations have broader implications for sugar supply, but Mechler said that it was unlikely that the reopening of the Port Wentworth site would affect sugar prices paid by food customers.

He said the closure of the site last year may have had some effect on prices at the time, but the raw sugar situation plays a much larger role in determining market prices.

Reconstruction​

The damaged refinery began shipping bulk sugar again in late July. Operations then returned to about 25 percent of normal capacity by August, with $149m of the estimated $210- $225m reconstruction costs paid by the end of the month.

Final testing of the packaging lines is now underway and is expected to be finished in time for the refinery to return to full capacity sometime this fall.

Mechler said the rebuilt refinery will be more efficient than before although its capacity will remain the same because little construction work was done on the refining facilities. He said it was the packaging side of the site rather than the refining facilities that incurred the brunt of the damage from last year's explosion.