Thailand's sugar industry, a vital component of its agriculture sector, is facing significant challenges as global sugar prices plummet to their lowest levels in three years. With approximately 70 percent of Thailand's sugar production shipped overseas, the country stands as the world's second-largest white sugar exporter after India and the third-largest raw sugar exporter behind Brazil. However, the current economic climate is creating substantial strain on this crucial industry.
In 2023, Thailand produced an impressive 11 million tonnes of sugar, utilizing over 1.6 million hectares (3.9 million acres) of land dedicated to sugar cane cultivation. Despite this robust output, the global price of white sugar has dropped sharply, reaching a low of US$470 per metric ton—the cheapest since September 2021. Although prices have seen a slight recovery, they are anticipated to stay depressed throughout the year, leaving Thai sugar farmers in a precarious position.
The industry is grappling with multiple adversities, including climate-related challenges and the repercussions of the global price collapse. The recent ban by China on imports of Thai sugar syrup has further compounded these issues, restricting one of the major export markets for Thailand's sugar products. This confluence of factors is putting substantial pressure on Thai sugar exporters and farmers alike.
Domestically, Thai consumers benefit from some of the most affordable sugar prices in Asia, with a factory gate price set at approximately 20 baht (58 US cents) per kilogram. The remainder of Thailand's sugar production is primarily sold within its borders. However, this internal market stability offers little solace to farmers who are increasingly concerned that the industry's prosperous period may be coming to an end.
Leave a Reply