Business
Record sugar inventory means bitter news
  • | dtinews.vn, NLD | May 25, 2017 08:00 PM
Vietnam's sugar inventory reached a record high, with the figure mainly attributed to the flooding of illegally-imported sugar, according to the Vietnam Sugar Cane and Sugar Association.

The association said that since earlier this year, the country’s sugar inventory reached an estimated 750,000 tonnes, accounting for half of the total output in the period.

 

Sugar inventory reaches record high

Chairman of the association Pham Quoc Doanh blamed the inventory for lower consumption. Meanwhile, Vietnam’s sugar exports to China struggled to compete with Thailand.

Doanh added that the main reason for the situation was the flooding of smuggled sugar which is often VND1,000-2,000 a kilo cheaper than domestically-produced sugar products. Smuggled sugar enters the local market via border gates in the south-west and border with Laos.

Dang Phu Quy from Quang Ngai Sugar Joint Stock Company said the penetration of more foreign confectionary products into the Vietnamese market was another important reason for the decline in sugar demand.

Le Cong Thanh, vice chairman of Lam Son Sugar Company said prices and the quality of sugarcane are placing Vietnam’s sugar industry behind Thailand. Thai plants are buying a tonne of sugarcane at USD26 while Vietnamese firms have to pay USD40-USD53 a tonne, and Thai sugarcane also has higher sugar content.

The use of many different kinds of sweeteners to replace sugar has also strongly slowed sugar consumption.

The total amount of illegally-imported sugar into Vietnam was estimated at 382,000 tonnes in 2015, causing a loss of VND1.8 trillion (USD81.8 million) for the state budget.

Tran Van Hung, Deputy General Director of Can Tho Sugar Company, said that more drastic measures should be taken to deal with smuggling and sale of these sugar products.

Deputy Minister of Agriculture and Rural Development Tran Thanh Nam said the ministry would work with other management agencies to find solutions for the situation. He also emphasised that in the context of more signed free trade agreements, Vietnamese sugar companies need to think of ways to reduce production costs, renovate technologies to raise product quality and competitiveness.

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