The prompt imposition of anti-dumping and countervailing duties on sugar originating from Thailand has encouraged domestic farmers continue to expanding raw material areas. However, local experts suggested that strengthening the link between farmers and businesses is a long-term measure to ensure the sustainable development of the sugar industry.

A sugarcane factory of Lam Son Sugar Cane Joint Stock Corporation. Photo: Lasuco

Since the imposition took effect from this March, the retail price of sugar has increased from VND1,500 (US$0.06)-VND2,000 (US$0.08) per kg compared to the end of 2020. The purchase price of raw sugarcane from local growers also increased by VND50,000 (US$2.1) to VND100,000 (US$4.3) per ton. 

The average buying price is currently at about VND950,000 (US$41.2)-VND1 million (US$43.3) per ton, Nguyen Cam Trang, Deputy Director of Import and Export Department under the Ministry of Industry and Trade (MoIT) told the seminar entitled “Opportunities and challenges for the sugar industry” held on March 23 in Hanoi.

Being of the same mind, Chu Thang Trung, Deputy Director of the MoIT’s Trade Remedies Authority of Vietnam, said that local manufacturers have increased the purchase price of sugarcane materials by 10%-13% compared to the previous crops. 

“This helps farmers remove difficulties and encourages them to consider replanting sugarcane and expanding areas of cultivation,” he said.

Nguyen Van Loc, Acting General Secretary of the Vietnam Sugarcane and Sugar Association (VSSA) said that the domestic sugar industry has been badly damaged by massive import of sugar in the past, so the recovery process takes a long time. 

“However, the government needs take on a policy on customs duties that would help increase the purchase price of sugarcane,” he said. 

Delegates at the seminar on March 23. Photo: Nhandandientu.vn

The Department of Agricultural Products Processing and Market Development under the Ministry of Agricultural and Rural Development forecast a shortage of  raw sugarcane supply for factories in this year’s crop. 

Currently, only 29 out of 40 sugar factories are still in operation. The total output of sugarcane in Vietnam is only around 5.3 million tons, equivalent to 530,000 tons of sugar. 

Vietnam’s domestic sugar price remains the lowest in the region. Local experts said that in order to develop sustainably, it is still necessary to build a close linkages between businesses and farmers, developing quality and sustainable sugarcane material areas, and investing in technology to improve product quality.

Recently, the government has slapped temporary anti-dumping duty of 33.88% and countervailing duty of 44.88% on sugar originating from Thailand.

The decision comes after the MoIT last September initiated an anti-dumping and countervailing investigation on imported sugar from Thailand on the basis of the request of  the VSSA and domestic sugar producers.