The end of sugar in Hawaii
BRYAN BERKOWITZ / SPECIAL TO THE STAR-ADVERTISER
Alexander & Baldwin announced Wednesday that it would cease operations at Hawaiian Commercial & Sugar Co., the last sugar plantation in the state, and transition to a diversified farm model.
An era — and an industry that employed generations of Hawaii residents — is coming to an end this year.
The owner of the last sugar plantation in the state has decided to quit farming what was once Hawaii’s biggest crop in a move that will lead to layoffs for nearly all of the Maui farm’s 675 workers and mark the end of the long, sweet industry in the islands.
Alexander & Baldwin Inc. announced Wednesday that it will phase out sugar cane farming at its Hawaiian Commercial & Sugar Co. subsidiary over the next 12 months and carve up the 36,000-acre farm covering much of Central Maui with an aim to produce diversified crops on multiple smaller farms.
Layoffs are expected to start in March, and the last harvest will happen at the end of the year. About half the crop, which won’t mature by the end of this year, will be left in the field or plowed under.
A&B leaders said the decision to shut down HC&S was reached with “great regret” and was based largely on A&B’s agribusiness division — mainly HC&S — losing $30 million last year with no turnaround in sight.
“This is a sad day for A&B,” Chris Benjamin, the company’s president and chief executive officer who ran HC&S as its general manager from 2009 to 2011, said in a statement.
“It is a sad day indeed,” added state House Speaker Joe Souki, who represents districts on Maui, in a statement. “So many of us have grown up in the shadows of sugar operations on Maui — with our grandparents and great-grandparents having worked the fields to provide for their families.”
Not everyone on Maui is sad to see sugar cane farming stop. Many residents complain about HC&S burning the fields as part of harvests, while others including Native Hawaiian taro farmers have battled the plantation over irrigation water rights.
Still, HC&S is one of the largest private employers on Maui, making its closure a big blow for the community.
A&B said about 30 HC&S employees will be retained after the last harvest to maintain infrastructure and continue operating East Maui Irrigation Co. Other employees will be laid off starting in March as their specific functions are completed, though about half the workforce should be employed till the last harvest at the end of the year.
Many other businesses also derived income through HC&S, from material suppliers to rum producers.
“It’s a domino effect through this community,” said Koa Martin, a 41-year old HC&S millwright.
Martin, who has a brother working at HC&S, said the mood at the plantation was somber Wednesday as company officials began informing employees of the plan.
“A lot of us been here 20, 30, 50 years,” he said. “Some of us have been here for all of our life.”
Martin, who followed his dad and grandfather working at HC&S, said generations of families on Maui are losing a part of their culture and history.
Even more broadly, A&B’s move will end more than a century of plantation-scale sugar production in the islands. Ceasing sugar production also will sever a 146-year-old living link upon which A&B was established, and leave Maui as the place where the industry began and ended in Hawaii.
Samuel Thomas Alexander and Henry Perrine Baldwin established A&B in 1870 after buying about 570 acres in Makawao and planting sugar cane that year. The company acquired or merged with other sugar plantations, including HC&S, and grew to become of one of Hawaii’s “Big Five” companies that dominated commerce for decades.
“A&B’s roots literally began with the planting of sugar cane,” Stan Kuriyama, A&B’s executive chairman, said in a statement. “Much of the state’s population would not be in Hawaii today, myself included, if our grandparents or great-grandparents had not had the opportunity to work on the sugar plantations.”
For more than a century, sugar cane farming was such a big business in Hawaii that the companies with the largest plantations dominated commerce in the islands. Thousands of immigrants from China, Japan, Portugal, Korea, the Philippines and other countries were brought to work on the farms. But over the last 40 or so years, plantations on all of the state’s major islands faced intense challenges to stay competitive with more cheaply produced sugar from foreign and mainland farms.
More than 100 Hawaii sugar cane farms closed between 1985 and 1995. A few hung on, the biggest of which was HC&S.
Maui lost its second-to-last sugar plantation in 1999 when Amfac shut down the 6,200-acre Pioneer Mill farm. Amfac followed that by ceasing production on 20,000 acres on Kauai. And when another Kauai farm, Gay & Robinson, shut down its 7,000-acre operation in 2009, HC&S was the lone Hawaii sugar plantation standing.
HC&S had adjusted with the times and endured some big financial losses, the biggest of which prior to last year was $28 million in 2009.
Even with the projected $30 million loss last year from farm operations, A&B was on track to earn a profit due to its real estate investment and development. The company reported a $43 million profit for the first nine months of last year, which included an $11.8 million operating loss from agribusiness.
CEO Benjamin, however, said that each time HC&S finances soured prior to last year, there appeared to be ways to recover, including changes in equipment, farm practices, labor savings, new products and higher sugar prices.
“We’ve always taken a long-term view on sugar,” Benjamin said in an interview. “In the past we’ve seen a path to improvement. We just don’t see that path right now.”
Kuriyama noted that A&B has run HC&S 16 years longer than Pioneer Mill but the business is forecast to produce continued significant and unsustainable losses. “We have made every effort to avoid having to take this action,” he said in a statement. “We must now move forward with a new concept for our lands that allows us to keep them in productive agricultural use.”
A&B’s plan is to use its 36,000 HC&S acres for possibly cattle grazing, orchards, agroforestry and biofuel crops but not seed corn. A&B also said it plans to establish an ag park with plots for lease to local farmers interested in growing food crops, and that preference will go to HC&S employees.
“A&B is committed to looking for optimal productive agricultural uses for the HC&S lands,” Benjamin said in his statement.
The company has previously researched the potential for biofuel crops that can be grown to produce energy. Such crops that can produce biogas include sorghum, Bana grass and Napier grass, and will move from a plot test to field-scale testing. A&B said it signed a confidential memorandum of understanding with local and national partners to explore market opportunities for biogas. Preliminary discussions with entities to produce biodiesel from other crops such as sunflower, safflower and soybeans also are underway, A&B said.
Using HC&S land to produce local grass-fed beef is something else to be examined, with a trial this year with Maui Cattle Co.
It remains to be seen if the transition plan will succeed and how long it could take.
Gov. David Ige said in a statement that he received the news of the planned shutdown with sadness but views the transition plan as a “golden opportunity for the state to focus on renewable energy and food security.”
Maui Mayor Alan Arakawa said in a statement that A&B’s experiments with growing replacement crops including taro, papaya, avocado and plants with biomass that can be used to produce energy give him confidence that agriculture will remain very much alive on Maui despite the impending death of sugar cane.
“Today marks the end of an era but also a new beginning for Maui as we work toward food and energy sustainability with HC&S and Alexander & Baldwin,” he said. “We knew that this day was inevitable.”
60 responses to “The end of sugar in Hawaii”
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Sugar gane hundreds of thoudands of low-skilled migrants a chance to make it in Hawaii and America and it did a fabulous job doing so. It helped produce amazing socio-economic mobility among some of ther poorest people on earth. Nothing we have now will do that for so many which is why so many are sad. We need to discover a substitute.
I agree with you, same for losing our pineapple industry. I wonder if the Jones Act has been the culprit in killing both industries?
Uh…no…the Jones Act had nothing to do with the failure of sugar cane. In fact, the sugar growers of this country (Yes, that would include Florida and Louisiana) have survived for as long as they have for generations, due directly to price supports for sugar as a commodity. Global competition for bulk sugar grown in foreign countries is tough for US growers…without supports. And the same could be said for pineapple. Amazing how local people think transportation of everything they need to live here in the middle of the Pacific Ocean should effectively be “free”. The Jones Act is the easy whipping boy for those who know so little about the maritime transportation industry as a whole, let alone the details of how the Jones Act law works and who it affects. I always red hundreds of comments about how “expensive” it is to ship something to Hawaii. But I never hear or read anyone expound upon just how much anything should actually cost to be moved from some distant shore, to our islands. Why? Because they really have no idea what is involved in the timely, efficient, safe, and secure process that is involved.
Wow, FINALLY an intelligent comment. What also allows the Southeastern Sugar growers to survive, is the ability to bring in migrant workers from Haiti, Dominican Republic, Mexico, etc. They’re paid much less than HC & S workers, are housed in claptrap plywood buildings, and fed rice and beans. Had Congress given HC & S 5-10 cents additional subsidy, it would have survived. Do the math on how much it would cost the US taxpayer to subsidize 60,000 tons of sugar. Then, look at how much a pound of sugar costs in Europe where sugar is subsidized to the tune of 30+ cents per lb/
Typical short sighted Congress, but HC & S was just a drop in the ocean to them !!!
Excellent! The cost of goods basically falls on what the market will bear. Evidence the price of fuel that has fallen dramatically but have we seen the price of commodities go down?
The sugar and pineapple industries have allowed families of immigrant workers the opportunity to reach educational and business success. Many of our business and political leaders today have family history tied to the sugar and pineapple industries. Hard work and fiscal prudence provided many with the opportunity to reach higher educational goals. Will our biggest industries now provide for he same?
The statement that sugar will now look to diversify, research and build a new agribusiness seems promising but let look at what the evidence is. Most of the former sugar and pineapple lands are now being subdivided and sold off to grow subdivisions. Acreage for “gentlemen” farmers who raise “sod”. Smaller parcels for truck farmers. Between the two, the truck farmers offer the best use of lands. They’ll need to have some sort of cooperative to pool their produce for marketing. Farms like Aloun may offer many jobs but as we’ve seen, not the best scenario for farm workers.
In my paper for the UH I interviewed many retired cane workers. Many wept remembering friends and family, the many free benefits, excellent wages,college scholarships for children, free preschools, and almost socialist safety net. One kind man said he never saw a homeless person or any mess on the plantation homes. He said how much he wished he could go back. Many also mentioned, as did Senator Inouye, about how plantations had provided a platform for rapid socio-economic advance. So many had rags to relative riches stories. What will replace sugar and pineapple with all of these benefits? MacDonald’s? Rent a Surfboard? Kentucky Fried Chicken?
Athletic scholarships.
Whenever a job is very generous, it’s a sign that the good times will come to an end. Management’s job is to cut as many benefits as possible from the workers. Benefits only cut into the CEO’S bonus.
sugarcane growing requires the most highly trained and paid agricultural workers in the world, Hawaii sugar plantations are highly efficient operations. If they can’t harvest cane by controlled burns, then they can’t remain profitable. Diversified ag – unless it’s seed farming or growing pot – is not nearly so profitable.
In the past few years, A&B has changed the type of cane they grow, testing the type that gets ‘mowed’ rather than burned. It appears they have decided that even with the new strains of sugar cane, they will not be able to make a sufficient profit. I hope they will be able to keep the land in ag rather than build it over.
agree.. diversified ag. is great
They still have to remove the roots even it they cut off the top. And processing with the leaves on may decrease their sugar yield.
Wrong. If my grandparents didn’t come to Hawaii as a migrant worker, I wouldn’t have been stuck on this third world living conditions of Hawaii.
Did you lie when you said you became a millionaire here?
I always lay down when I comment here.
You wouldn’t have been born which probably would have been a good thing. Please think about this, your “third world” allows you to post really dumb things online and gives you the freedom to show your ignorance for all the world to see. Isn’t that a blessing?
Then BEAT IT, you whiner !!!! Your grandparents busted their okole to make a living !! Are you too good to work hard and live in Hawaii ?? Or are you entitled to something better ???
🙁 Boo Whoooo. Third World one of my favorite groups! Jah Love.
Work harder and quit whining or bail.
I hope they are found jobs. I hope whatever agriculture that will be there will hire them.
Under the 2014 Federal Farm Act and State law, industrial hemp can be planted in these sugar cane lands, providing agricultural jobs and hemp for 25,000 uses/products, including hempcrete, a termite-proof building material already used in construction in other nations.
Good idea!
Great in theory. But in all reality, hemp would fail too. Why? Same reason sugar fails in Hawaii and thrives in other countries where labor cost is a fraction of what is paid in Hawaii. IN other words, there is no way Hawaii’s hemp would be able to compete economically.
It can compete in a number of ways. Animal forage, and cattle ranchers would not have to ship herd to the mainland for feeding. Hempcrete, and builders would not have to import fossil based drywall. Also hempcrete is termite proof, climate controlled–lessening need for air-conditioning plus it is mold resistant. First hempcrete home was built on Maui, with more to follow on that Island and on Kauai.
Many walls of homes were built with “canex” a by-product of sugar cane hull back in the 40’s including the camps for the arriving Army soldiers following the Pearl Harbor attack. Worked in the cane field at 14 at a dollar a day, then the following summer in the pineapple field and at 16 in the cannery in Kapaa on Kauai before the start of WW II..
Even thugs and the mafia need leadership from the local government. Something that Hawaii is absent of.
Split from Hawaii, Mike the novice !!! All you do is cast stones, and offer NO solutions. Cancer like YOU should be cut out and thrown away ……….
First we need need to test and experiment to see if hemp wont become an invasive species. This is Cynthia Thielen’s bill. It was couple years ago. Don’t know if the verdict is in.
Better to grow hemp indoors like it’s close relative pot until then. IIRC I’ve heard that Monsanto is breeding the medicinal variety. So it would be nice if local farmers could do test crops with the hybrid seed.
Once the verdict is in, I’m sure that local field testing will show that industrial-scale pot ag in the islands will be hugely profitable. The price of medicinal pot will go way down.
Wonder if that would affect the Huis’ plans in controlling the distribution of the medicinal pakalolo? Only those on the inside can get the license to dispense the concoction.
getting a license is pretty transparent. We can tell if organised crime is applying.
Here, Here!1 You’re right on the money!! And also, Hawaii HONEY is much sought after Internationally and far easier to produce–just need to grow more Flora. “Hemp” can also help tremendously to remediate the soil conditions, and in this case–the Arsenic, Pesticides, and Synthetic-Fertilizers.
HC&S, the sugar processor, can buy raw bulk sugar from anywhere in the world. If someplace like Costa Rica has lower land, water, labor and shipping prices than Hawaii, their sugar will be cheaper. Companies like Gay & Robinson, Amfac, C. Brewer, Waialua Sugar and A&B can either keep cutting their prices to compete (losing money in the process) or they have to shut down the plantation and cut their losses. It’s simply the reality of competing in a global market. Growing a commodity crop in the most isolated land mass on the face of the earth, in a state that has one of the highest land, energy, labor, water, transportation, and tax costs is completely unfeasible. It’s a sad day for the workers but it was inevitable.
Nope. Their operations remain profitable. But the citizens on Maui went tolerate cane burning to harvest. These mainlanders do not like smoke in their eyes. Times change.
Actually, you are wrong and papakolea is exactly correct. How do I know? I have seen ships delivering sugar in bulk to the C&H mill in Crockett California. I have also seen ships from other countries delivering bulk (and bagged) sugar to Domino Sugar mills in Texas and Louisiana ports and in Baltimore. “Profit”as measured by A&B’s entire operation is one thing. The profit and expenses specifically to their sugar operations is entirely something else. You OBVIOUSLY did not read this article at all. If you had, you would understand this concept. Regardless of the profit or loss from sugar operations, A&B as a landowner looking into the future understands there is far more money to be made from developing the land for homes or commercial operations. Revenues from farming it for sugar, even under the best case scenario, still pales in comparison to developing the land for Maui’s unchecked growth.
Nope, we’re talking past each other. Obviously the price of sugar affects profit. But on the average, they are still profitable despite the tough compitition. of course they need to look at their overall operation. There’s a graph in one of the articles which shows this.
Every now and then you might want to read the article before commenting.”projected $30 million loss last year from farm operations” AND The company reported a $43 million profit for the first nine months of last year, which included an $11.8 million operating loss from agribusiness.
When it comes to economics, this cold not be better news for investors. We should all be quite versed in knowing that although the plan is to “diversify” the ag operation, it will only be a matter of time before the land is rezoned for real estate and housing developments. Much more lucrative than agriculture…and let’s face it, Maui is the second Oahu already. Sugar will survive….but in places like Africa, Philippines, Cuba….just not in America. That Sugar in the Raw that you enjoy with your coffee? Get them now and save a few packs. These will be the last Maui sugar you will see ever. Does this also spell the end for C&H sugar?
Starbucks was the #1 buyer of the Maui raw packets. Head down and stuff you’re pockets now!!!!
People wont tolerate burning cane, It’ll be much worse with diversified farming.
Funny, the The Star Advertiser neglects to tell this part of the story.
They gave plenty of air time to the cane burning complaints through the years. Money trumps complaints. No make money, no burn cane. Make money, burn baby burn!
New culture in Hawaii is to shop and feed Wall Street.
HAWAII NEEDS TO RETURN TO AN AGRIAN-SOCIETY. SELF-SUSTAINING and ORGANIC. “Wall-Street” will ultimately UNDERWRITE these ventures. Hawaii has all the resources to become the ORGANIC FOOD(S) CAPITAL OF THE WORLD! Far greater ROI/sq.ft. than any other investment. And, everyone can play in the game.
“AGRARIAN” (Redacted)
Larry Ellison had a plan to turn Lanai into the #1 supply source of organics for Japan. Not sure if that is still in the plan.
Many of us can thank our grandparents and great grandparents for coming to Hawaii to work hard, save, and buy homes. What is the next generation bringing? Teach your children well.
And, also remember that for all practical purposes–were it not for the Plantation Housing most immigrants were “HOMELESS”. And, I believe that if they were alive today they would be ashamed of all of us for allowing “Homelessness”. I’m certain they would want us to resolve these issues…
The Big difference, my friend, is that those immigrant plantation workers worked their butts off to enable their kids to have a better life. Not so with our present homeless.
Have you offered a Homeless person a job? The opportunities available in that era–no longer exist. Moreover, you didn’t need an education nor much “experience” to perform those jobs. As you know, that simply doesn’t exist today. Additionally, the wage-scale for which most Homeless could qualify wouldn’t even pay today’s rent, etc.. Finally, just so you know–I have total respect for the Immigrants who traveled from far away lands and made all those sacrifices and improved and created new lives in a new Land.
(..can’t say much for their children nor their children’s children…)
Will be interesting to see how much A & B sugar land ends up as crackerboxes.
Let us remember that Alexander Baldwin invested heavily in sugar, installing drip irrigation at HC&S in the 1970s for example, while the other companies were putting their money into expanding elsewhere and neglecting sugar. Nobody can say A&B didn’t try to keep it alive. As for the Jones Act argument, let us not forget that A&B owned Matson and found domestic shipping just fine for its purposes.
Yes. Matson developed the ability to bring loaded containers of cargoes needed here (going westbound to Hawaii). The ships would then shift to a dock where they back loaded bulk sugar. Many of the containers that they loaded on deck carried refrigerated pineapples being exported to the mainland. It was the perfect arrangement, with revenue earned both east and westbound. That does NOT exist today. The more efficient operation was to move bulk sugar to several different ports on the mainland (as needed) by several different ships (as many as 4 operating year round) during peak operations. But time eventually changed all that. Today the Sugar Planters Association of Hawaii owns and operates 1 ship to carry their cargo of bulk sugar and molasses just a few times a year (and laid up the rest of the year) from Maui to Crockett, CA. It’s the end of an era.
The anti cane burning people are cheering the shut down of the plantation. You know those folks who moved to Hawaii for a certain lifestyle and won’t tolerate anything they don’t like and have the money to sue sue sue. They got the super ferry closed down, but wait till the developers get hold of that vacant sugar land. Subdivisions galore. They may have stopped the government from operating the super ferry but developers contribute to much to campaigns to be stopped. Look at Oahu, maybe those folks should consider moving.
Exactly
I am disgusted to see the comments in social media by the anti’s about the closing of HCS including a Senate candidate for Kihei/Lahaina, Terez Amato (I think that’s her name). So many people losing their jobs and she is cheering. What’s wrong with this woman? No aloha. No kokua. No clue. My heart goes out to the families at HCS.
Where’s the aloha? Maui is changing.
Sad. Law suits prohibiting burning of cane is what broke the camel’s back.
I posted 3 C & H commercial URL links from YOUTUBE circa 80’s with the caption “Ah what fond memories! ENJOY. 🙂
S/A flagged “Your comment is awaiting moderation” It was removed — really?
Posting a second time – again awaiting moderation.
People like, Waokanaka, here think that this site is for children. They can’t bear for us to tell the truth without telling us to get lost.
One more nail in the coffin of high paying jobs on Maui – oh well, guess everyone can be service industry providers to tourists. On a lighter note: Hillary has not been indicted yet for her crimes, yet all of Hawaii will vote for her lock-step anyways with a 110% turnout and a 112% vote for Democrat. More news at 11 …….