China’s key sugar Provinces show increased output due to higher yield 03-26-2018

Sugar output in China's major sugar producing areas in 2017/18 will be higher than in 2016/17. More importantly, China's sugar output increases are mainly driven by higher yield. However, especially the most important production area Guangxi Province shows an output decline. CCM analysis the key production areas in China for the current harvesting season.


 


China is the world’s third-largest sugar producing country right after Brazil and India. Looking at the raw materials, sugarcane contributed more than 90 % of the total sugar production in the recent decade. In fact, sugarcane is a major crop in southern China, especially in the key sugar production areas Guangxi, Yunnan and Guangdong. Of them, Guangxi is the dominant sugarcane and sugar production base in China.  


South China's Guangxi Zhuang Autonomous Region, China's largest sugar manufacturing base, saw the output of sugar production rise in 2017. Production reached 5.8 million tonnes, up 9.5 percent year on year. The annual income of the region's sugarcane growers increased 15.3% to 3.9 billion USD. However, in February 2018, tThe total sugar output was down 52,000 tonnes in a year on year comparison. Guangxi provides about 60% of the country's sucrose production and has more than 20 million sugarcane growers. 


The Ministry of Agriculture and Rural Affairs revised down China's sugar output in March for the harvesting season 2017/18 by 50,000 tonnes to 10.3 million tonnes, while sugar exports were revised up to 120,000 tonnes. The new forecasts are based on higher industrial consumption. 


At the end of February, China’s sugar enterprises had almost finished the sugar harvest for the 2017/18 sugar extracting season, which is lasting from October 2017 to September. According to market intelligence firm CCM, China's leading sugar manufacturing companies have harvested altogether 55.72 million tonnes of sugarcane of which have been produced 6.70 million tonnes of sugar so far. The sugar sales volume has been stated around 2.51 million tonnes, which indicates a sales/production ratio of 37.5%, around 2% lower than in the season 2016/17. 


It is worth mentioning, that the sugar production for the season 2017/18 was already completed in Inner Mongolia and Xinjiang at the end of February, while the extraction in the other major planting areas Hainan and Yunnan was still underway at that time. 


CCM gives a brief summary of the sugar processing situation of all major areas in China. 


Guangxi Zhuang Autonomous Region:

Enterprises in this region squeezed 38.40 million tonnes sugarcane, up 280,000 tonnes YoY. The total sugar output was 4.49 million tonnes, down 52,000 tonnes YoY. As of February 28, 3 locally-based sugar factories have suspended sugar production, namely Guangxi Hepu Xichang, Guangxi Laibin and Guangxi State Farms Sugar Group, while the remaining 88 were still in operation. 


Yunnan Province:

As of February 28, altogether 56 sugar factories in Yunnan have started sugar production for 2017/18, the same number of last extracting season. The amount of squeezed sugarcane reached 7.73 million tonnes, a small increase to the 7.16 million tonnes last year. Sugar output also increased significantly from 940,800 tonnes, compared to the previous 865,500 tonnes.


Guangdong Province:

As of February 28, Guangdong has squeezed 6.95 million tonnes of sugarcane, a slight increase to the 6.60 million tonnes in the same period of last extracting season. Sugar output also grew to 641,300 tonnes, from. 608,600 tonnes.


Xinjiang Uygur Autonomous Region:

COFCO Tunhe Xinyuan kicked off local sugarcane production for 2017/18 on 20 Sept. 2017, and Xinjiang Lvhua Sugar ended local sugar production on February 18. As of the end of February, the amount of squeezed beet was 4.44 million tonnes with a sugar output of 541,100 tonnes.


Hainan Province:

The amount of squeezed sugarcane has been 1.16 million tonnes, up 119,700 tonnes YoY. The sugar output reached 135,200 tonnes, up 16,000 tonnes YoY. In February alone, Hainan produced 32,300 tonnes of sugar and sold 8,100 tonnes YoY. On February, 4 locally-based sugar factories have suspended sugar production and another 7 were still in operation.


Inner Mongolia Autonomous Region:

The production suspension of Botian Sugar on 28 February indicated the end of local sugar production. The province is expecting to produce about 480,000 tonnes of sugar in the 2017/18 extracting season.


The above data shows that sugar output in China's major sugar producing areas in 2017/18 will be higher than in 2016/17. More importantly, China's sugar output increases are mainly driven by higher yield, rather than increased growing area, according to China Sugar Association (CSA). It estimated that China's sugarcane/beet growing area declined from 1,656,650 ha in 2015 by 2.32% to 1,696,000 ha in 2016 and then by 16.44% to 1,417,000 ha in 2017, but China's total sugar output increased from 8,700,000 tonnes in the 2015/16 extracting season to 9,290,000 tonnes in 2016/17 and 10,200,000 tonnes in 2017/18. 


About the article


The information for this article comes from CCM, China’s leading market intelligence provider for the fields of agriculture, chemicals, food and feed.


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