Drought hits sugar output

Thailand may produce at least 3.8% less sugar this year because of drought has cut cane output, a government official said on Monday.

Production may fall below 7.5 million tonnes from 7.8 million tonnes last year, said the official in charge of output planning. He said a serious impact in some areas from drought could continue into next year.

A drop in supply from Thailand may help offset increased production from Brazil and support prices, which tumbled 6.8% last week.

Thikha Khunnawat, director general of Thai Sugar Millers Corp, said many mills have already ended crushing. Sugarcane is also facing competition from other crops like cassava.