The refinery hit hard times earlier this year after Coca-Cola and Pepsi stopped using liquid sugar in favor of lower-cost corn syrup. The two companies accounted for 60 percent of the refinery's business.
Parent company Alexander & Baldwin Inc. said today that the loss of the two big soft drink customers shriveled the market to the point where it was no longer economical to run the Aiea plant.
"Without sufficient demand and supply, there simply is no cost-effective way to continue to operate in Aiea," said John C. Couch, A&B's chairman, president and chief executive.
The closing will leave local companies, including bakeries and drink makers, with no local source of liquid sugar, and leaves refinery workers with no place to take their skills for a paycheck.
One local user of liquid sugar, syrup maker CICO Enterprise Ltd., said it knew early this year that there would soon be no local supply of liquid sugar to make its Harders brand shave-ice syrups and has been looking for alternatives.
"We're still looking at our options at this point. We haven't made a decision," said Wink Whitaker, director of sales.
A&B said that half of the refinery's 14 workers were laid off last month, and received severance payments negotiated by their union.
The seven remaining workers don't belong to the union and will work one week a month until the plant closes early next year, said Meredith Ching, A&B vice president. The company wants to keep the refinery open until customers can find alternate sources of sugar and is exploring the feasibility of shipping liquid sugar from the main C&H refinery in San Francisco Bay, she said.
The old refinery at the Aiea site used to produce granulated sugar for local retailers as well as sugar for manufacturers. It was closed in 1993 and was rebuilt that year to produce only liquid sugar for bakers and soft drink makers.