Thursday, June 29, 2017
The Myanmar Times
The Myanmar Times

China sugar shipments decreasing

Myanmar's brief boom as a sugar exporter appears over, as traders say Chinese customs are turning back shipments at the border.

China started buying sugar from Myanmar in April last year as Chinese sugar plantations declined in number. Over the next year, Myanmar exported more than 3 million tonnes across the border via Muse and Chinshwehaw border posts.

But in the past few months Chinese authorities recently began a crackdown on illegal trade, disallowing cross-border shipments despite many local exporters having made deals with Chinese traders across the border, U Win Htay, deputy chair of the Myanmar Sugar and Sugar-Related Products Merchants and Manufacturers Association, told The Myanmar Times on October 21.

Most of the sugar exported by Myanmar is bought from Thailand and India and re-exported to China.

Prices hit their peak at the beginning of this year, with tonne of sugar fetching 5300 Chinese yuan, worth US$783, the equivalent of more than K1200 per viss of sugar (one viss equals 1.6kg or 3.6lbs). But the price had slid to 4200 yuan (then about $600) by April. A brief recovery to 4700 yuan failed to persuade Myanmar shippers the market was worth it, he said.

“The world sugar price is $625 per tonne at the port. Exchange rates mean this is uneconomical. Though transportation charges are falling because of increasing exports to China, sugar prices have plunged by about K80 to K50 per viss,” said U Win Htay.

Minister for Commerce U Than Myint said his ministry was aware of the problem, but that Myanmar and China did not have an official agreement on sugar trading. The commerce minister urged patience as his ministry was reaching out to Beijing to begin discussions on a bilateral trade agreement that would hopefully pave the way for a sugar quota, he said.

“When you see trade between an economic giant and the developing small country, people think that Myanmar will immediately benefit from its strategic location of being in between China and India,” he said. “People think that Myanmar can penetrate those markets with its products, but in reality, their own products are dominating their local markets legally and our products are just penetrating in small amounts as illegal trade.”

The government was also negotiating with other countries, he added, so local producers were not solely reliant on China.


Translation by Win Thaw Tar