The last stand for manufacturing in East London

Posted on 4 Feb 2013

Once upon a time, the east end of London was a hive of manufacturing activity, with ships flooding the River Thames to bring in commodities and export goods.

Deindustrialisation decimated the area, but out of the factory ashes came regeneration from the once-booming financial sector.

Tate & Lyle Sugars is one of the last remaining stalwarts of London’s industrial past, with sugar arriving from developing countries to its refinery in Silvertown. Here the raw sugar goes through a purification process with the final product sent to its Lyle Golden Syrup factory a mile along the river, food manufacturers across the UK and into its familiar blue and white packaging for consumer consumption.

However, its existence is under threat despite being one of the most efficient refineries in the world. After operating around the clock seven days a week for 50 years, production slumped, jobs were axed and weekend operations cancelled in 2010.

EU casualties

“Since the UK joined the EU, our refinery in Plaistow closed – although we are still there making syrup. This was swiftly followed by our site in Liverpool,” said Tony Bennett, government affairs and strategy manager at Tate and Lyle Sugars. “All that has been caused by the EU because it has closed access to raw sugar by placing restrictions on where we could buy sugar from.”

Save Our Sugar Campaign
Save Our Sugar Campaign

The London refinery is now draped in a huge ‘Save Our Sugar’ banner as the company takes its last stand against the European Commission and its management of the EU market.

Tate and Lyle Sugars is treading new legal ground by suing the European Commission for €198m for mismanaging the sugar market.

In 2005 the EU selected developing African, Caribbean and Pacific states to supply sugar to EU with duty free status, restricting imports from sugar-rich countries such as Brazil.

However, the chosen countries failed to produce the amount of sugar needed by cane refiners, stunting supply. This resulted in Tate and Lyle’s London sugar cane refinery – the biggest in Europe – running at just 60% capacity.

Meanwhile beet sugar processors benefit from no import restrictions as it is grown in Europe. In its attempt to boost the levels of cane sugar coming into the EU, the Commission sanctioned blind auctions, further pushing up the price of raw sugar. This has been passed onto supermarket shoppers and food manufacturers, with sugar prices in the EU 80% above the world price.

Conservative MEP Marina Yannakoudakis complained that EU protectionism is putting cane refiners out of business while beet sugar processors like British Sugar – maker of Silverspoon – register record profits. “If the European Commission were to allow more flexible imports of raw sugar, refineries would be able to expand in order to meet the increased demand,” she said. “Cane refiners need to be given a fair chance to compete.”

Tate and Lyle Sugars has been losing money since 2009, three years after imports were restricted by the EU. It made a £38m loss in the last financial year and the 850 jobs at its Silvertown refinery will become another manufacturing casualty in East London unless something changes.

River workers

Tate and Lyle has a consultancy arm to help create efficient sugar mills and refineries in other parts of the world.
Tate and Lyle has a consultancy arm to help create efficient sugar mills and refineries in other parts of the world.

The plant has been employing people from one of London’s most deprived areas since 1878. If the plant is forced to close, it wouldn’t just consign the biggest London manufacturer on the Thames to history, but end a trade passed down from father to son.

“I’ve worked here for 30 years. My dad worked here. My granddad worked here,” said Ken Wilson, community affairs manager. Although the refinery is now highly automated and “much less physical,” it is still employing a local workforce to carry out the monitoring and troubleshooting now required.

However, having grown up in the area, Mr Wilson and the rest of the 850 people that work here are fixtures of the river, the refinery feeding off the river like the “fantastic fishmen” cormorants, with masses of water piped in to boil the impure yellow coating off the raw sugar.

Wilson rose through the ranks and has managed the unloading bay, the blustery patch where two towering cranes take it in turns to scoop sugar onto conveyors bound for the ‘shed,’ the name given to the refinery’s warehouse.

There is space for 65,000 tonnes of sugar, which fills the shed like golden pyramids because the cane sugar starts life as a sandy colour before the impurities are removed for consumption.

However, the sugar pyramids no longer stand so high. Just 30,000 tonnes are typically there at any one time now, as import restrictions blast manufacturing out of the East End.

The refinery was initially run at a slow pace as output dropped but its Goliath-size made this inefficient.

“Even if the plant was shut down over the weekend we were still using energy and had people on site being paid to not produce sugar,” explains Wilson. Staff were put to work redecorating the refinery and painting the car park with the company reluctant to sack loyal workers and hopes of a return to full capacity.

The great British bake-off

Sugar is unloaded evenly from the ships to avoid structural damage.
Sugar is unloaded evenly from the ships to avoid structural damage.

Despite these efforts, it only delayed the inevitable. The company axed 28 staff last year.

Although Mary Berry and her baking comrades on TV have ignited a surge in demand for the company’s syrup arm, which is supplied with sugar by the refinery, the company is still in a sticky spot.

The money made from Henry Tate’s industrial empire helped to build one of the world’s most famous art galleries, the Tate Modern. Unless the EU makes some changes soon, it will continue to choke supply to one of London’s most historic companies.

Let’s not consign another London manufacturer to history when it can be one of the world’s best.