Sugar inventories in the first quarter of this year rose 50 percentover last year to 600,000 tonnes, while prices at processing plants fellto the lowest level in five years.
Statistics from the Ministryof Agriculture and Rural Development showed that by the end of March,the sugar sector produced 1.17 million tonnes of sugar, an increase ofabout 120,000 tonnes against the same period last year.
Theministry estimated that sugar output this year would reach 1.6 milliontonnes, while domestic market would consume 1.4 million tonnes,resulting in sugar supplies being 200,000 tonnes larger than demand thisyear.
In addition, as part of the country's World TradeOrganisation's commitment, Vietnam would have to import 77,000 tonnes ofsugar. The import amount, together with sugar inventories from theprevious years and illegal importing of sugar across borders, wouldleave the nation's sugar stocks at 400,000 tonnes.
Ha Huu Phai,head of the Vietnam Sugar and Sugarcane Association (VSSA)'s HanoiBranch, was quoted by Nong Thon Ngay Nay (Countryside Today) as sayingthat sugar selling prices have been continuously decreasing, causingdifficulties for the industry.
For instance, sugar prices atplants were reduced from 18,000-19,000 VND (0.86-0.90 USD) per kilo in2011 to 14,000-15,000 VND (0.67-0.71 USD) per kilo in 2013.
Further,in the first three months of 2014 sugar prices saw a sharp decline to12,000-13,000 VND (0.57-0.62 USD) per kilo, while illegally importedsugar was selling for only 11,000 VND (0.52 USD) per kilo. Also, sugarprices on the world market fell from 800 USD to 465.9 USD per tonne.
Phaisaid slower consumption and larger stockpiles have caused sugarprocessing plants to cease operating, such as Long My Phat SugarcanePlant in southern Hau Giang province and Kien Giang Sugarcane Plant.This has pushed sugar farmers into a corner, as they had been unable tosell their sugar. Further, several farmers have had to shift to growingother crops.
Some large plants, such as Lam Son SugarCorporation, also suffered losses. It processed some 12,000 tonnes ofsugar in the first quarter of the year, meeting only 10 percent of theyear's target, while processing 50,000 tonnes in the same period lastyear.
Phai said the Government should allow the sector to export sugar to China, as a solution to reduce stockpiles.
Theassociation forecast that sugar output for the 2013-14 crop in Chinawould be 14.2 million tones, while its domestic demand would be 16.3million tonnes.
VSSA proposed to export 300,000-400,000 tonnes this year, in addition to meeting its export quota of 200,000 tonnes.
Theassociation also asked the Government to use funds for reinvestment inthe sector by supporting sugar farmers and developing sugar plantingareas.
The association requested that the ministries of Financeand Industry and Trade apply zero tax on sugar imports by 2018, insteadof 2015 as planned, to help processing plants set aside more time toprepare for competition from foreign countries.
Ministry ofIndustry and Trade officials, meanwhile, said it would allow anadditional 200,000 tonnes of sugar to be exported if the sectorfulfilled its current quota of 200,000 tonnes.-VNA
Statistics from the Ministryof Agriculture and Rural Development showed that by the end of March,the sugar sector produced 1.17 million tonnes of sugar, an increase ofabout 120,000 tonnes against the same period last year.
Theministry estimated that sugar output this year would reach 1.6 milliontonnes, while domestic market would consume 1.4 million tonnes,resulting in sugar supplies being 200,000 tonnes larger than demand thisyear.
In addition, as part of the country's World TradeOrganisation's commitment, Vietnam would have to import 77,000 tonnes ofsugar. The import amount, together with sugar inventories from theprevious years and illegal importing of sugar across borders, wouldleave the nation's sugar stocks at 400,000 tonnes.
Ha Huu Phai,head of the Vietnam Sugar and Sugarcane Association (VSSA)'s HanoiBranch, was quoted by Nong Thon Ngay Nay (Countryside Today) as sayingthat sugar selling prices have been continuously decreasing, causingdifficulties for the industry.
For instance, sugar prices atplants were reduced from 18,000-19,000 VND (0.86-0.90 USD) per kilo in2011 to 14,000-15,000 VND (0.67-0.71 USD) per kilo in 2013.
Further,in the first three months of 2014 sugar prices saw a sharp decline to12,000-13,000 VND (0.57-0.62 USD) per kilo, while illegally importedsugar was selling for only 11,000 VND (0.52 USD) per kilo. Also, sugarprices on the world market fell from 800 USD to 465.9 USD per tonne.
Phaisaid slower consumption and larger stockpiles have caused sugarprocessing plants to cease operating, such as Long My Phat SugarcanePlant in southern Hau Giang province and Kien Giang Sugarcane Plant.This has pushed sugar farmers into a corner, as they had been unable tosell their sugar. Further, several farmers have had to shift to growingother crops.
Some large plants, such as Lam Son SugarCorporation, also suffered losses. It processed some 12,000 tonnes ofsugar in the first quarter of the year, meeting only 10 percent of theyear's target, while processing 50,000 tonnes in the same period lastyear.
Phai said the Government should allow the sector to export sugar to China, as a solution to reduce stockpiles.
Theassociation forecast that sugar output for the 2013-14 crop in Chinawould be 14.2 million tones, while its domestic demand would be 16.3million tonnes.
VSSA proposed to export 300,000-400,000 tonnes this year, in addition to meeting its export quota of 200,000 tonnes.
Theassociation also asked the Government to use funds for reinvestment inthe sector by supporting sugar farmers and developing sugar plantingareas.
The association requested that the ministries of Financeand Industry and Trade apply zero tax on sugar imports by 2018, insteadof 2015 as planned, to help processing plants set aside more time toprepare for competition from foreign countries.
Ministry ofIndustry and Trade officials, meanwhile, said it would allow anadditional 200,000 tonnes of sugar to be exported if the sectorfulfilled its current quota of 200,000 tonnes.-VNA
