This Access Asia report on the sugar market in China deals with the ongoing developments as the market restructures. The report deals with both foreign companies in the sector, local initiatives and production.
Sugar is obviously a major world crop with global turnover approximately US$ 100 billion and rising as a result of increasing consumption and the switch to high quality products. Sugar has been produced for centuries, though only become a universal food in the 1850s. China grows both beet and cane sugar. Sugar cane is really a form of perennial grass, which is replanted every few years and contains approximately 10% sugar. Sugar beet is an annual crop with around 15% sugar content. As well as sugar for ingredients and personal consumption it is also used for ethanol (an automobile fuel) and other by-products including animal feed and paper. The retail market for sugar in China has grown by over 80% since 1995. Despite price fluctuations due to the effects of altering world sugar prices and local shortages the demand for sugar by Chinese consumers is steadily growing. Growth is being stimulated by growing use of sugar as an ingredient in food and beverage products as well as an additive to foods and drinks. In general, cane sugar refineries are performing better than beet sugar refineries, most of which are currently recording losses. Despite this the government estimates that 152 of China’s small sugar mills are faced with bankruptcy. In 2000 and 2001, new controls on China’s sugar production led to domestic sugar prices rising quickly, ending a three-year depression. China’s key sugar-producing provinces - Guangxi, Guangdong, and Yunnan - experienced major sugar price increases.