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Thailand Sugar Production Revised Down

08 October 2012
USDA Foreign Agricultural Service

THAILAND - Sugar production is revised down to 10.2 million metric tons in market year (MY) 2011/12 and will likely decline to 9.9 million metric tons in MY2012/13 due to lower-than-expected sugarcane production resulting from unfavorable weather conditions.

Sugarcane production is lower than expected in MY2011/12 crop which is estimated at 98.4 million metric tons. MY2012/13 sugarcane production is likely to further decline to 95.0 – 96.0 million metric tons, down 3.0 per cent from the previous year, due to unfavorable weather conditions particularly during the midseason growing period.

Despite the lower sugarcane production, the average extraction rate of sugarcane is expected to increase to around 104.5 kg/ton of cane in anticipation of normal rainfall during the ripening stage.

Sugar consumption is also revised to 2.5 million metric tons in MY2011/12 and 2.6 million metric tons in MY2012/13 in anticipation of an economic slowdown in the second half of 2012 and in 2013. Sugar exports during January-May 2012, however, are expected to be up 37.3 per cent from last year, particularly for raw sugar which account for 70.0 per cent of total sugar exports due to limited export supplies from Brazil and India.

Sugar exports will likely reach 9.0 million metric tons raw value (MMTRV) in MY2011/12. Meanwhile, MY2012/13 sugar exports are revised down to 8.5 MMTRV due to lower-than-expected sugar production caused by drought conditions.

The government is now considering a new soft loan program that will enable cane growers to buy harvesters and improve their production efficiency. The program is estimated to cost 3.0 billion baht ($100 million) which will be financed by the state-run Cane and Sugar Fund. The Thai Government operated a similar 2.0 billion baht ($66 million) program during the FY2010 – 2012 period.

Ethanol production

According to the official MY2011/12 crushing report by the Office of Cane and Sugar Board (OCBD), sugarcane production is lower than expected at 98.4 million metric tons. This resulted in a downward revision of sugar production to 10.2 million metric tons. An estimated 0.4 million metric tons of sugarcane was used for ethanol production.

Most of the sugarcane harvest will be primarily used for sugar production and a small amount will be used for ethanol production.

Sugarcane use for ethanol production will remain low as sugar prices continue to be more attractive than ethanol prices. Presently, there is only one sugarcane based ethanol plant operating in Thailand using 0.4 – 0.5 million metric tons of cane/year.

Further Reading

You can view the full report by clicking here.

TheCropSite News Desk



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