Bitter days for China's sugar industry
Updated: 2014-10-08 08:56
NANNING -- China's embattled sugar industry, facing pressure from foreign competitors and technological shortcomings, is caught in the middle of a year-long sales crisis.
According to latest statistics from the China Sugar Association (CSA), manufacturers delivered about 13,318,000 tons of sugar in the 2013/2014 "sugar-making period," which lasted from last October to September this year.
But sales of sugar is a mere 77 percent of the same period last year, with 10.24 million tons sold by the end of August.
With winter, the industry's slowest season, coming soon the worrisome situation shows no signs of getting better anytime soon.
In Guangxi Zhuang autonomous region, China's biggest producer of sugar, some 1.5 million tons of sugar remains in shops. Local farmers are still waiting anxiously for 1.9 billion yuan ($309.4 million) of unpaid money for the sugar cane they sold, according to CSA's Guangxi branch.
Cheng Weijun, who manages the department that oversees trade with the farmers at the East Asia Sugar Factory in Guangxi's Chongzuo city, has felt the pinch in a period usually marked by booming sales.
"By mid-September, only 70 percent of our sugar has been purchased," he said.
The factory produced about 220,000 tons of sugar in the 2013/2014 period, which should be sold at least 5,000 yuan per tonne to avoid losses. But as tepid business cast its spell, sugar price is set at around 4,300 yuan, eating away at profits for factories like East Asia.
"It's been a tough year for us," Cheng said.
The spiraling-down industry has taken its toll on farmers as well. Huang Zongxin, manager of the farm business department of Guangxi Funan East Asia Sugar Co Ltd, said that some farmers have stopped growing sugarcane because of disappointing sales.
"Out of 580,000 mu (38,667 hectars) of our sugarcane planting bases, about 48,000 mu has been changed for vegetables and fruits, " Huang told Xinhua.
In Guangxi, strikes by sugarcane farmers have been reported due to unpaid wages.
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