NEW DELHI: Thailand, Asia’s top sugar exporter, will try to tap mills in the Middle East to offset the loss after its main buyer Indonesia decided to cut imports of raw sugar.
There was no bid for Thailand’s sugar which was offered at 90 points over New York prices, unchanged from last week, traders in Thai capital Bangkok said.
Fears of a freefall in prices due to a glut in the region has forced millers in Thailand to go slow on sugarcane crushing which normally begins on Dec 1. Analysts say millers in Thailand will not utilise full capacities as they fear higher sugarcane production estimates will add to the glut.
According to an analyst in Australia, the Thai cane harvest is expected to be closer to 75 million tonnes than earlier estimates of 70 million to 72 million, compounding millers’ woes.
As part of its efforts to trim stocks built up by higher imports and rising domestic production, Jakarta this month decided not to issue new production licences to sugar refiners.
Sufficient stocks: Traders in New Delhi say Indonesia’s decision has come at a time when India, the world’s second-biggest producer and biggest consumer, has more than sufficient stocks.
Trade and government officials say with India’s carryover stocks of 11 million tonnes from the last season and an output forecast of 20 million tonnes, availability will be much higher than its annual consumption of about 23 million tonnes. Despite bulging stocks in the region, Brazil, the world’s biggest producer of the sweetener, has some sold some sugar to mills in China and India.
Traders say some refineries in China and India turned to Brazilian sugar after falling freight made purchases from the south American nation attractive. Imports from Brazil have added to bulging stocks.
India was likely to export only 800,000 tonnes of sugar in the year to September 2009 against a record five million tonnes shipped a year ago, Peter Baron, chief of the Indian Sugar Organization, told Reuters in an interview this week. reuters
Source : Daily Times