China's sugar output is expected to rise less than 1% — USDA

Chinese sugar output is expected to rise less than 1% — to 10,7 million tonnes in 2019/2020, as low prices and limited land availability slow production growth.

It is reported by U.S Department of Agriculture (USDA).

The small growth in production is driven by increased beet output, especially out of Inner Mongolia, the top beet-producing province. Overall beet sugar production in the country is forecast at 1,5 million tonnes, compared with 1,4 million tonnes last year.

Cane sugar production is expected to remain steady at 9,3 million tonnes as the area dedicated to sugarcane cultivation expands in the top-growing province Guangxi but contracts in Guangdong and Hainan provinces.

The increase in Guangxi is attributed to supportive measures from the provincial government, including the high prices at which mills are mandated to buy from farmers. Mills, however, complain that they are losing money and are petitioning for market-based pricing and subsidies for farmers.

The USDA expects imports to remain steady at 4,3 million tonnes, as the rise in official imports so far this year is offset by a decrease in smuggling.

Ending stocks for 2019/2020 are projected at 4,5 million tonnes, down almost 1 million tonnes year on year. Stocks are expected to continue to fall as industry contacts believe national reserves will be released to fill the gap between domestic consumption and production.