Sugar cane output for the 2021-22 crop year is expected to drop below 100 million tonnes as sugar millers are offering higher prices amid tough competition to buy crops.
It is reported by Bangkok Post.
Drought is a major factor reducing yields, which will affect sugar production and exports.
Even in the wet season, Thailand will see less rainfall this year, said Rangsit Hiangrat, director-general of the Thai Sugar Millers Corporation (TSMC).
«Sugar manufacturers expect sugar cane output to be 70-75 million tonnes in the new crop year», — he said.
Farmers have also converted sugar cane plantations to plant cassava, Mr Rangsit said.
In the 2020-21 crop year, Thai sugar cane output decreased by 8.20 million tonnes to 66.7 million tonnes, from 74.9 million tonnes in 2019-20.
TSMC expects sugar millers to produce less than 7 million tonnes of sugar in 2021-22, compared with a record 14.7 million tonnes in 2017-18.
Both Thailand and other cane-growing countries are facing a drought and this has caused some sugar millers in Thailand to announce they will purchase sugar cane from farmers at 1,300 baht per tonne (41 USD/t) in 2021-22, up from the normal price of 1,000 baht a tonne (31 USD/t), said Narathip Anantasuk, head of the National Federation of Sugarcane Planters.
The federation said sugar cane output will not be enough to supply all factories, so they will be forced to compete.
They want to produce sugar in large volumes for domestic and export markets.
"The federation expects sugar cane output in 2021-22 crop year to be 80 million tonnes," he said.
In Thailand, sugar cane plantations cover 11.6 million rai (1.856 mln ha) in 47 provinces.
The number of sugar mills in the country decreased by one to 56 after a sugar factory owner in Udon Thani closed due to financial problems.