Sugar production in Thailand will decline from a record this season after drought in the world’s largest shipper after Brazil limited cane growth and cut yields, according to the country’s millers’ group.
Output may total 10 million to 11 million metric tonnes from a cane crush of 98 million to 103 million tonnes, Sirivuthi Siamphakdee, a spokesman for Thai Sugar Millers Corp, said in a phone interview yesterday. Sugar production was a record 11.3 million tonnes from 103.7 million tonnes of cane the previous season, according to Office of the Cane & Sugar Board data.
Sugar cane is harvested at a plantation of Da Mata, the Brazilian sugar cane processor, in Valparaiso, Sept 18. The country, second only to Thailand in sugar production, stands to pick up market share as the kingdom cuts production due to drought. (Reuters photo)
Lower supply from Thailand may narrow a global surplus that's forecast by the International Sugar Organization at 473,000 tonnes in 2014-2015. Futures rose 11% from a three-year low in January on concern that dry weather may cut harvests from Brazil to Australia, the world's third-biggest shipper.
"Rainfall this year has been lower than normal, reducing growth of cane and bringing down cane output from an earlier forecast of 110 million tonnes," Sirivuthi said from Bangkok, where the group that represents 51 mills nationwide is based. "If the upcoming winter lasts long enough, it can help increase sugar content in cane."
The crushing season may start late this month or in early December, with the exact date to be announced by the Office of the Cane & Sugar Board, Sirivuthi said. In the previous season, crushing started on Nov 25.
Drought across Thailand from May to July stunted cane growth, limiting the plants' height and cutting production, Montree Laohasakprasit, secretary-general of the United Association of Thai Sugarcane Planters, said last month. The cane harvest is estimated to decline to about 90 million tonnes, yielding about 9.6 million tonnes of sugar, he added.
July outlook
In July, the Office of the Cane & Sugar Board had forecast an increase in the sugar harvest to 12 million tonnes, citing farmers' increased planting of cane as some growers favoured the sweetener over rice.
Nationwide rainfall in Thailand so far this year was 5% below a 30-year average, according to data from the Thai Meteorological Department. During January to March, rainfall was lower than the average by more than 50%, data show.