Sugar prices hit record high, Nghe An businesses invest in expanding raw material areas, improving production technology
(Baonghean.vn) - Following the increase in world sugar prices, the domestic sugar market in general and Nghe An in particular have seen many improvements. Profits have increased, the consumption market is positive, sugar enterprises have focused on investing in expanding raw material areas, people are assured in production, sticking with sugarcane...
Enterprises invest in developing raw material areas
According to the Vietnam Commodity Exchange (MXV), by mid-September 2023, sugar is a bright spot as it continues to receive positive buying power. World sugar prices recorded an increase of 1.63% for grade 11 sugar and 1.81% for white sugar in yesterday's session. With the above increase, sugar prices are maintaining at a high price range within 12 years.
In the domestic market, when the 2022-2023 sugarcane crop ended, the selling price of sugar at factories fluctuated between 20,000 - 22,000 VND/kg, but after a short time it increased to 26,000 - 27,000 VND/kg. In particular, at retail agents, sugar prices fluctuated between 26,000 - 30,000 VND/kg.
The reason for the recent sharp increase in domestic sugar prices is that sugar production in major producing countries such as India and Thailand is likely to decline, causing a deficit in the sugar supply-demand balance in the 2023-2024 crop year. In addition, sugar prices have also increased due to concerns that India will restrict sugar exports next October.
The increase in sugar prices has helped factories make profits and confidently invest in raw material areas, increase the purchase price of raw sugarcane and have many policies to encourage farmers to expand sugarcane growing areas, thereby helping factories have enough raw materials for production.
For Nghe An Sugarcane Company Limited (NASU), the increase in sugar prices has recorded positive business results in the first 3 quarters of the 2023 fiscal year. Mr. Ngo Van Tu - General Director of Nghe An Sugarcane Company Limited said: “The increase in sugar prices is a positive signal, helping factories make profits and boldly reinvest. Our company has a capacity of 800,000 tons/year but so far has only produced less than 700,000 tons/year. Therefore, the company is restoring the raw sugarcane growing area by cooperating with farmers to achieve an output of 800,000 tons.
In the 2023-2024 crop year, the company will invest more than 5 billion VND in providing farmers with seeds, agricultural materials, fertilizers, and supporting farmers to apply mechanization to sugarcane fields to help reduce production costs, while increasing productivity many times over. In particular, the high price of sugar has led to the factory increasing the purchase price of raw sugarcane for people to 1,160 million VND/ton, the highest ever.
Song Con Sugar Joint Stock Company (Tan Ky) also has many policies to expand the raw material area. Mr. Nguyen Ba Quy - Deputy Director of Song Con Sugar Joint Stock Company said: "The high price of sugar, the company purchases sugarcane from sugarcane growers at a high price, which has created a strong driving force to develop the raw material area in recent times. Regarding raw material policy: The company provides loans to invest in all stages of sugarcane production from land preparation to mechanical harvesting and care, prevention of sugarcane pests and diseases; supports treated sugarcane sludge for planting and caring for sugarcane up to 20 tons/ha; supports machine loading of sugarcane; supports spraying of sugar content-enhancing products; supports large customers with areas of 20ha or more.
In addition, depending on the specific situation of each region, the company will have specific support policies to develop suitable raw materials. In the last pressing season, the company also invested 5 billion VND to apply new technology to refined sugar processing. Thanks to that, up to now, the company's raw sugarcane area has reached over 6,500 hectares, mainly concentrated in Tan Ky, Anh Son, Thanh Chuong, Yen Thanh, Nam Dan districts. The increase compared to the 2021-2022 crop year is 25%; The company's sugar output in the 2022-2023 crop year is 32,000 tons. The expected crop year 2023-2024 is 42,000 tons.
Farmers are excited to "stick" to sugarcane
According to a survey of sugarcane enterprises, the price of raw sugarcane in Nghe An is being purchased by factories at a gradually increasing rate. Three years ago, the price of raw sugarcane was from 900,000 - 950,000 VND/ton, then increased to 1 million VND and this year's crop increased to 1.1 - 1.16 million VND/ton. According to forecasts, the price of sugarcane in the 2023-2024 crushing season will increase further. With this price, sugarcane growers will make a profit of 30-40 million VND/ha, helping farmers feel secure in sticking with sugarcane and expanding the sugarcane growing area.
Mr. Nguyen Nam Anh - Head of Long Tien village, Binh Son commune (Anh Son) said: “The sugarcane area of the whole village is 47 hectares with 100 households growing sugarcane. The land for growing sugarcane was previously alluvial land, rice land, hilly land, and ineffective highlands, and was converted by the people to grow sugarcane as raw material for the sugar company. With a purchase price of 1 million VND/ton, it has helped people earn about 30 million VND/ha, higher than other crops. In the next crop year, with the company's support for seeds, techniques, and fertilizer loans, the people in the village plan to expand the area to 50 hectares. Sugarcane has become the main crop of the villagers".
As a long-time sugarcane farmer, Mr. Tran Doan Le (Hamlet 9, Thanh Tien Commune, Thanh Chuong), in addition to his family's available land area, for the past 3 years, has rented land from many other families in the area, renting 5% of the land locally to grow over 50 hectares of raw sugarcane. Thanks to proper investment in care, the annual sugarcane yield reaches over 70 tons/ha, sometimes reaching over 80 tons/ha. With the sugarcane price purchased by the factory at the field of over 1.1 million VND/ton, his family earns a profit of about 30-40 million VND/ha each year.
“The last pressing season, the price of sugarcane was high, now the price of sugar is increasing, so for the 2023-2024 crop, my family has rented more land to grow sugarcane. At the same time, I also contacted other localities in the province to expand the area,” said Mr. Le.
The increase in sugar prices has led to an increase in raw sugarcane prices, and with many policies to develop sugarcane raw material areas and many mechanisms to support sugarcane growers, farmers in Tan Ky, Anh Son, Quy Hop, Nghia Dan districts are actively taking care of sugarcane and converting ineffective land areas to new planting. Therefore, the sugarcane area in the province has increased quite rapidly. In 2021, the whole province had nearly 18,500 hectares, in 2022 it increased to nearly 20,200 hectares, and in 2023 the sugarcane area is expected to be over 23,000 hectares.
According to the approval of the "Project on developing key agricultural products of Nghe An province in the period of 2021 - 2025, with a vision to 2030", by 2025, the total sugarcane area of the province will be 26,700 hectares (including 5,000 hectares of high-tech sugarcane), with an output of 2,000,000 tons; by 2030, the area will be 25,700 hectares (including 10,000 hectares of high-tech sugarcane), with an output of 2,200,000 tons.
With the current sugar price, with the sugar market showing many improvements, sugar enterprises are actively expanding raw material areas, stabilizing processing capacity, gradually improving technology, processing lines to create other products besides sugar and after sugar, hopefully, the project's goals will soon be reached, farmers in raw sugar areas will increase their income, develop production. Sugarcane is not only a "poverty eradication" plant but also a "rich" plant for farmers in raw sugarcane areas.