|The Ministry of Industry and Trade on Tuesday allowed domestic companies to export sugar with large volumes in an attempt to reduce the record high inventories of 450,000 tonnes.—VNA/VNS Photo Hoang Hai
HCM CITY (VNS)— The Ministry of Industry and Trade on Tuesday allowed domestic companies to export sugar with large volumes in an attempt to reduce the record high inventories of 450,000 tonnes.
Since the beginning of the 2012-13 sugar crop, the Sugar and Sugar Cane Association has predicted that there would be a sugar surplus.
Sugar is one of the country's price-stabilised commodities, so its exports are only allowed when there is a surplus, according to Ha Huu Phai, head of the association's branch in Ha Noi.
The country needs about 1.2-1.3 million tonnes of sugar a year.
The association estimates that the sugar output in the 2012-13 crop will reach 1.4 million tonnes.
In addition, stocked sugar from last year as well as imported and smuggled sugar are available.
About 300,000-400,000 tonnes of sugar are smuggled into Viet Nam from the southwest border a year, according to the association.
The country now has 40 sugar mills producing the 2012-13 sugar crop.
The sugar inventories of the companies have increased by about 100,000 tonnes a month since the beginning of the crop, which normally begins in September.
To reduce inventories, some sugar mills have cut prices, but sales continue to be low because of low demand.
Some sugar mills have also exported small quantities of sugar through unofficial channels.
To reduce sugar inventory in the long term, smuggled sugar must be strictly controlled and sales of legal sugar must increase, according to Phai.
The sugar industry needs to improve its competitiveness on price and quality, especially against smuggled sugar, he said. — VNS