Imported sugar and smuggled sugar still dominate the market

According to the Vietnam Sugarcane and Sugar Association (VSSA), the price of sugar did not improve much in the first half of April 2022, despite demand increasing slightly during the recovery period after the Covid-19 pandemic and supplies still being abundant.

Under the influence of rising sugar prices on the international market and increased freight rates due to fuel price increases, officially imported sugar from ASEAN countries and smuggled sugar from border provinces with Cambodia and Laos still dominate the market. Even though the price of imported and smuggled sugar has gone up, it is still lower than the domestic production cost of sugar from sugarcane.

In the second half of April 2022 smuggled and imported sugar from ASEAN countries flooded the market with its cheaper prices, preventing sugar produced domestically from sugarcane from being consumed.

The output congestion is seriously threatening the sugarcane supply chain, along with an increase in prices of agricultural inputs, creating many obstacles to efforts to recover the sugarcane area of Vietnam's sugar industry.

In April the majority of factories in Vietnam's sugar industry finished processing the 2021/22 sugarcane crop, with a few factories continuing to produce until May. By the end of the month the whole industry will have pressed 6.4 million tons of sugarcane, producing more than 662,000 tons of sugar. Compared to the same period of the 2020/21 sugarcane pressing season, this season’s output of pressed sugarcane is 106.95% and the output of sugar is 105.14%.

Also in April, fraudulent activities in the sugar trade continued. The smuggling and illegal transportation of sugar produced in foreign countries into Vietnam were regularly detected and led to arrests.

On April 10, in Thuong Thoi Hau A commune, Hong Ngu district, Dong Thap province, Cau Muong Border Guard Station discovered 1,400kg of sugar gathered in a roadside hut with no owner. This amount is typical of smugglers illegally transporting sugar across the border to sell in Vietnam. When they discovered the patrol and management forces, the subjects quickly escaped and left behind the goods.

On April 13, the Market Management Team No. 3, under the Department of Market Surveillance in Dong Thap province, discovered an unattended gathering point with signs of smuggled goods at the foot of So Thuong bridge in Block 1, An Thanh ward, Hong Ngu city, Dong Thap province. Following an inspection, Market Management Team No. 3 discovered that all of the above goods were foreign-produced granulated sugar, with a quantity of 750 kg.