September 10, 2009 / 7:28 AM / 9 years ago

INTERVIEW-Thai Roong Ruang may export 10 pct more sugar in 2010

* Demand from India a factor in higher export forecast

* Production to rise to 1.4 million tonnes in 2009/2010

By Apornrath Phoonphongphiphat

BANGKOK, Sept 10 (Reuters) - Thai Roong Ruang Group, Thailand’s second-biggest sugar miller, has expanded capacity because it expects its exports to rise 10 percent in 2010, helped by a revival in demand from India, a senior executive said.

The company is forecasting exports of nearly 1 million tonnes in 2010, up from around 890,000 tonnes expected in 2009, Executive Director Utai Asdatorn said.

“We have expanded our capacity as we see a bigger crop and strong demand,” Utai told Reuters in an interview on Thursday.

“Soaring world sugar prices have encouraged millers to produce more sugar and that means farmers are growing more cane,” he said.

New York raw sugar for October delivery SBV9, which sets the global trend, settled at 20.99 cents per lb on Wednesday after hitting a 28-1/2-year high last week at 24.85 cent per lb.

In the current 2009/10 crop, Thailand, Asia’s biggest sugar exporter, is forecast to produce around 7.6 million tonnes of sugar from around 72-76 million tonnes of cane.

Its 2009/10 crushing season is expected to start in November and end in April.

Thai Roong Ruang Group, which runs seven sugar mills, is one of five big Thai millers to have expanded capacity to meet rising global demand.

After the expansion, it is likely to produce 1.4 million tonnes of sugar in 2009/10, up from 1.2 million tonnes in the previous crop.

Utai said the company had contracted to sell around 50 percent of its 2009/10 production in advance through international trading houses.

“We sell mostly to our traditional customers in Asia and the Middle East. However, we expect to sell more sugar to India next year,” Utai said.

India, the world’s biggest sugar consumer, has been largely absent from the Thai market for several years but tight domestic supply has forced it to import more, the main factor behind the rise in world prices in recent months.

It is expected to import around 4 million tonnes of sugar in the 2009/10 crop year due to a fall in domestic cane production caused by a poor monsoon.

Utai said he expected Thai sugar production to rise gradually over the next few years as the world sugar deficit encouraged farmers to grow more cane.

The London-based International Sugar Organization (ISO) has forecast a global sugar deficit of 8.4 million tonnes in 2009/10. [ID:nL2138534] (Editing by Alan Raybould)

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