China will start to levy a safeguards tariff on sugar imports after a six-month investigation, in order to protect the domestic sugar industry and stabilize the market, the Ministry of Commerce said on Monday [22 May 2017]…Full Article: China Daily May 2017

Key Points

  • In addition to the 50% import duty on out-of-quota sugar imports, China’s Tariff Commission of the State Council will impose an additional 45% duty (1st year – 2017), 40% (2nd year – 2018) and 35 (3rd year – 2019).
  • China reportedly has 40 million sugar farmers that produce 14 million MTs of sugar annually.
  • From 2011 to 2015, Chinese imports of sugar increased from 2.92 million MTs to 4.85 million MTs.

ChinaAg Comments

  • In September 2016, National Development and Reform Commission (NDRC) announced that China will sell 350,000 MTs of sugar from its state reserves at CNY 6,000 (US$900) per MT. During the same month, the Ministry of Commerce began investigating foreign sugar imports at the request (submitted July 2016) of the Sugar Association of the Guangxi Region.
  • In March 2016, Chinese authorities have launched a “Gateway Sword 2016” campaign (ends on 31 December 2016) in order to close 227 illicit border crossings into Guangxi, increase border patrols, and combat the influx of smuggled sugar, grain and frozen food. At the same time, according to a Chinese sugar industry expert, China has a 2 million MT per year sugar supply gap as the country’s output and imports total 14 million MTs, while consumption totals 16 million MTs annually. As a result of the sugar smuggling, China’s domestic sugar prices have not declined.The price of sugar in Guangxi Region was approximately CNY 5,400 per MT [~US$834 per MT].
  • In January 2016, Guangxi Region canceled a regulation that permitted individuals to import 1 kg of sugar per day.
  • In 2015, Chinese sugar imports spiked owing to cheaper prices on the international market (vs. domestic prices). A large of amount of these imports were held in bonded warehouses for failing to register and pay duties. As of late 2015, China reportedly had 500,000 MTs to 800,000 MTs of sugar in bonded warehouses waiting for customs duties to be paid.
  • From the 2014-15 to 2015-16 season, Guangxi’s sugarcane production area decreased by 100,000 ha to 800,000 ha.
  • In 2014, China introduced a new registration system that required sugar importers that don’t qualify for the low import tariff quota to secure permits before their sugar clears customs. China was hoping to cap 2015 sugar imports at 3.8 million MTs.
  • In 2013, China produced 128.2 million MTs of sugarcane crops (unprocessed sugarcane). Guangxi produced 81 million MTs of approximately 63% of the country’s total output.
  • In China, sugarcane production is centered in the southern regions, whereas beetroot production primarily occurs in the north. In 2011, Guangxi province produced 72 million MTs of sugarcane or 64% of China’s total output. Neighboring Yunnan and Guangdong provinces produced 18.9 million MTs (17%) and 13.9 million MTs (12%), respectively.

Hong Kong Trends

Similar Posts by ChinaAg

Spread the word. Share this post!