Bitter days for China's sugar industry

Foreign pressure

Domestic demand for sugar has been dwarfed by imports of the product, disturbing the supply-demand relationship in the country.

Customs data shows from 2011 to 2013, China's sugar imports have almost doubled from 2.92 million tons to a record 4.54 million tons, accounting for almost one third of domestic production. In the first five months of this year alone, inbound sugar stood at 1.3 million tons, a year-on-year increase of 6.7 percent, and that figure does not include smuggled sugar.

Soaring imports are a result of foreign sugar costing less, according to Zhong Zhiyou, vice president of the farm business department of Guangxi Nanning East Asia Sugar Group (GNEASG).

"Even with all taxes included, imported sugar is still cheaper than homegrown products," Zhong said.

As urgency for change mounts, experts have come up with a technical solution for the slinking demand.

Sugarcane was initially introduced from Taiwan. But the type of sugarcane used is susceptible to problems such as pests and low production, said Niu Gongfan, a senior engineer with the CSA's Guangxi branch.

"We have developed our own strand of sugarcane that yields higher production, and we are gradually replacing the old types," Niu said.

Tang Shaoxiong, vice general manager of GNEASG, said new growing techniques is being applied to help local sugarcanes grow better.

"Traditionally, sugarcane is planted on slopes, making irrigation extremely difficult and we could only hope for rainy days," Tang said. "But now we have drip irrigation technique by burying pipelines underneath, which greatly improves production," he added.

Tang also suggested that the government step up efforts to lower costs and improve competitiveness of domestic sugar to survive cut-throat competition.

Top 10 global shipping centers	Government forecasts bumper grain harvest