Thailand: Sugar makers warn of output cut due to drought

Illustrative image (Photo: Internet)

Bangkok (VNA) – Sugar makers in Thailand have warned that another drought could significantly cut into sugar output in the 2020-2021 crop, according to local media.

President of the Thai Sugar Millers Corporation (TSMC) public relations working group Siriwut Siempakdi said the industry must brace for the next drought. If the sugar-cane production area in northeastern Thailand sees lower-than-normal rainfall during the wet season, the 2020-21 crop could experience record lows in output.

TSMC statistics showed sugar-cane output was 74.9 million tonnes in the last crop year (2019-20), resulting in 8.27 million tonnes of sugar.

Siriwut noted that last crop year, the drought crisis affected the sugar-cane industry globally and it increased global sugar prices up to 15 US cents per pound, but this year Brazil plans to increase sugar exports.  

TSMC has closely monitored Brazil to see if the country will cause sugar prices to decline by redirecting some of its production towards biofuels, he said.

The price of sugar in the world market dropped from 15 cents per pound to 11.09 cents earlier this year.  

The COVID-19 pandemic has affected oil demand, causing Brazil to delay transitioning some of its sugar production to biofuels.

Those factors will affect the sugar-cane and sugar mill industry in Thailand, and TSMC expects it will be another hard year for the industry, according to Siriwut.

Thailand is the world's fourth-largest sugar producer and second-largest exporter, after Brazil.

The country has a total 57 sugar mills with a capacity of 984,000 tonnes per day, supplied by 18,240 sq.km of sugar-cane plantations across 47 provinces./.