Chinese sugar imports are forecast to fall to a five-year
low next season, as production rises and the government clamps down on smuggling
and other imports, US officials said.
Chinese sugar production is expected to rise by 1.0m tonnes
in 2017-18, to 10.50m tonnes, helped by a government drive to increase can
production, and rising prices, the US Department of Agriculture's bureau in
"Increased domestic sugar production and an expected easing
of prices next year are forecast to result in steady growth in sugar
consumption, as well as a decrease in imports," the bureau said.
However, a great deal of uncertainty remains over Chinese
government policy, and its impact on the market, with the potential for imports
to fall faster if further restrictions are increased.
2016 saw the launch of the Chinese government's latest
five-year plan, which included a programme to boost sugar production to 15.0m
tonnes by 2020.
Given consumption is forecast to rise to 18.0m tonnes over
the same period, this would suggest a gradual shrinking of imports.
Chinese sugar imports are forecast to fall by 1.0m tonnes
year-on-year, to 4.2m tonnes, the lowest level in five years.
"Higher domestic production and tighter expected government
control over imports will likely result in a reduction in imports," the bureau
And the bureau also noted reports from industry contacts that
illegal sugar imports have also fallen.
"The Chinese government has reportedly increased monitoring
and combating of sugar smuggling," the bureau said, also noting that availability
of Indian sugar for smuggling has been restricted this year.
Potential for further
And the bureau noted that imports could be drop even faster,
if the Chinese government enacts further restrictions.
The Chinese Ministry of Commerce is currently conducting a "safeguard
investigation," which has the potential to find that the domestic industry is
threatened by imports, opening the way for further restrictions.
The results of this
investigation are expected on May 22.
"If safeguard measures are implemented, it would likely
result in an even further decline in imports," the bureau said, noting
potentially effects on stocks and prices as well.