Peter McConnell speaks to a worker adjacent a laden cane cart on the Worthy Park Estate in Lluidas Vale, St Catherine in this 2006 Gleaner photo. - File

The McConnell-owned Worthy Park Estate Limited, anxious to grow production volumes, is taking another stab at expanding its sugar holdings by going after the Innswood Estate in St Catherine, one of five factories that Jamaica has put up for sale.

Managing director Peter McConnell confirmed this week that his company was one of the 14 interests that Agriculture Minister Christopher Tufton mentioned but did not name more than a week ago.

The Financial Gleaner was advised by sector players of seven names on the list of interested parties, some of which include previous bidders. The mix covers local and overseas firms, including at least one from Europe.

Worthy Park, which is in the business of bulk rum and sugar and is considered Jamaica's most efficient sugar factory, is, according to McConnell banking on Innswood to grow volumes, and reap even better economies of scale, to stay competitive in the world market where its produce ends up.

"Without Innswood we are going to be out of business. If we get Innswood we can improve it from the 40,000 tonnes it presently produces to 160,000 tons of cane in five years," McConnell told the Financial Gleaner.

"With what is happening in Europe we have got to increase our throughput for our unit price to go down, expanding is our only option."

The yield of cane per hectare is down at the 379-year-old facility, which McConnell attributes to the most recent hurricanes and excessive rainfall.

Worthy Park, whose factory has a capacity of 27,000 tonnes, has consistently produced the country's third largest quantity of sugar.

McConnell says he squeezes a tonne of sugar from every eight tonnes of cane he crushes - or in the language of the industry, his TCTS ratio is 8:1.

In the past two years, however, he produced a flat 20,000 of sugar each year for the market, and he expects similar performance again in 2009.

"We need 5,000 additional acres of cane and if we get Innswood, we can improve it from the 40,000 tonnes it presently produces to 160,000 tonnes in five years."

It is not the first time that the company is attempting to acquire the lands on the Innswood Estate. In 2005, it indicated that it was urgently in need of an additional 1,400 hectares to produce sugar at costs that were internationally competitive.

Competition

How serious McConnell is about getting out of sugar if he fails to secure Innswood is unclear, but at the very least he has began to diversify his business lines, a visit to the estate revealed this week.

Additionally, Worthy Park's rum business grew last year. The company entered the branded rum market in 2007 with an overproof white spirit called 'Rum Bar', having commissioned a state-of-the-art distillery at a cost of J$400 million.

Worth Park has the challenge of competing with the Wray and Nephew Group which dominates Jamaica's spirits market.

However Gordon Clarke who manages the Worthy Park facility said the distillery, which has the capacity to produce 4,000 litres at 100 per cent alcohol per day, has seen a 100 per cent increase in sales in 2008 follo-wing a shaky start in its first year.

While unwilling to reveal the sales figures, Clarke indicated that the company will be matching the J$15 million that it spent on marketing last year to ensure that the product continues to make inroads in the market.

The rum is sold in Amsterdam, United Kingdom, Scotland and Spain. Worthy Park's next target is the United States market, for which discussions are underway.

Some 20 per cent of the product is exported, another 50 per cent is stored for ageing while the remainder is prepared for the local market.

Innswood and other assets of the loss-making Sugar Company of Jamaica, were put back on the market at midnight December 31, 2008 after selected Brazilian purchaser Infinity BioEnergy failed to meet payments for the assets in order to close the purchase deal cobbled last year with a state energy company thrown in as bait.

Government has now broken up the assets into packages in order to secure early purchase agreements, but is still willing, if an investor comes along, to sell the assets as one package.

"It was a very good idea to offer the packages in parts, because even if one operator fails, it does not mean that all the estates will be affected," said McConnell.

mark.titus@gleanerjm.com.