Sugarcane production in the central province of Quảng Ngãi. — VNA/VNS Photo Hoài Nam

Sugar could become more expensive during the remaining months of 2023, according to the Vietnam Sugarcane and Sugar Association (VSSA).

Data from the Vietnam Commodity Exchange (MXV) showed global sugar prices had reached US$161 per tonne in nearly November, a 150 per cent increase compared to the beginning of the year, marking the highest price in the last 12 years.

Industry experts said a decrease in supply as India and Thailand, two of the two largest producers, lowered their output was the main factor behind recent price hikes.

Thành Thành Công-Biên Hòa JSC, a major sugar producer in Việt Nam with a 46 per cent market share, said the company's revenue increased to VNĐ5.9 trillion ($245.8 million) during the first three quarters of 2023, a nearly 20 per cent increase compared to the same period in the previous year, fetching VNĐ663 billion in pre-tax profit.

After-tax profit, however, plummeted by 17 per cent as the company struggled with high interest rates, paying out over VNĐ444 billion on interest payments, almost double the amount recorded in 2022.

Lam Sơn Sugar reported its highest growth, VNĐ471 billion in revenue and VNĐ17 billion in profit, a 55 per cent and 113 per cent increase, respectively compared to the same period in 2022. In an earlier development, Lam Sơn Sugar announced a plan to import 40,000 tonnes of raw sugar this year, as part of an effort to meet their annual target.

Sơn La Sugar also reported strong growth with a revenue of VNĐ431 billion and profit of VNĐ119 billion, an increase of 26 per cent and 47 per cent respectively, compared to the period last year. An effort to reduce financial costs by Sơn La Sugar has yielded stronger profits and was on its way to meeting this year's fiscal target.

Quảng Ngãi Sugar reported an after-tax profit of VNĐ506 billion for the third quarter of 2023, a 60 per cent increase compared to the same period last year but slightly lower than their performance during the first and second quarters of 2023.

In total, Quảng Ngãi Sugar reported a total revenue of VNĐ7.74 trillion during the first nine months of the year, an increase of 23 per cent compared to the same period last year, with sugar being the strongest growth driver for the company, fetching VNĐ3.12 trillion in revenue and VNĐ1.26 trillion in gross profit.

With just a few months left before the end of 2023, the price of sugar will likely increase due to higher demand, typically seen towards the Tết (Lunar New Year) Holiday. Meanwhile, inventory has been running low for some time, prompting experts to anticipate difficulties on the supplier's side in the domestic market.

They advised sugar producers to capitalise on high prices to strengthen domestic sugarcane production and rely less on imports. — VNS