South Texas’ shuttered sugar mill now part of $1 billion plan to revive U.S. cane industry

Three companies have partnered to buy the former Rio Grande Valley Sugar Growers Inc. mill in Santa Rosa in an effort to revive the sugar industry in South Texas and beyond.

In May, Dallas-based Bizos Cavallo Enterprises, Vera International of Birmingham, Alabama, and Verax Commodities of Charlotte, North Carolina, formed Santa Rosa Sugar LLC to acquire the facility. 

Together, the firms — a consulting company, a private equity group, and a sugar trader — are positioning themselves to revive sugar investments in the United States following the closure of Texas’ last sugar mill and a decline in farming operations in Texas and Montana.

According to a written statement, the company estimates it will invest about $1 billion over the next five years to expand refining and sugar cane farming capacity nationwide. 

Water shortages and a potential solution

The sugar mill closed last year because it didn’t have sufficient water. The RGV Sugar Growers website says the shutdown was responsible for the loss of 500 full-time jobs. Texas Agriculture Commissioner Sid Miller, however, says that number was higher.

“Public records show the original shutdown impacted 1,100 to 2,900 total jobs, including 735 to 1,435 direct farm and mill positions,” Miller said in a news release announcing the mill’s relaunch. 

Santa Rosa Sugar hopes to avoid its predecessor’s fate by installing a water recycling system to meet the challenge.

Phil Gentlesk, Jr., head of US Sales for Verax, told the RGV Business Journal that groundwater would be reclaimed for reuse.

“A FSIS processor is a system that can take contaminated water and purify it to reuse safely,” Gentlesk said. “It’s a system that I think will not only help our sugar business, but in general, it’s sustainable.”

The South Texas drought has been exacerbated by the lack of water deliveries Mexico owes the U.S., and billions of gallons remain outstanding.

However, Bizos Cavallo Enterprises’ website says the company is part of a joint venture with patent holders of a water-cleaning technique that produces nearly 100% purified, reusable water. That technique took about 40 years to develop.  

Economic impact

Miller said at least 130 sugar farms across the Valley would be resuscitated through Santa Rosa Sugar’s plan.

“At its peak, the industry supported thousands of jobs, covered over 40,000 acres in the Rio Grande Valley, and contributed over $100 million annually to Texas,” Miller said in his release. “Restoring sugarcane means jobs, community revitalization, and preserving an important part of Texas’s agricultural history.”

It will take several years for Santa Rosa Sugar to complete the relaunch of the mill, but sugar distribution may take place by year’s end. 

​​Phase I, set for 2025, calls for land acquisition, infrastructure evaluation, and renewed engagement with Valley sugar growers to rebuild the supply chain. It also includes an early restart of packaging and distributing sugar to U.S. markets, beginning in Texas and expanding nationwide.

Future projects include the construction of a new refinery, job creation, and the start of a nationwide distribution network.