China's top sugar area sees lower 2008/09 output

SHANGHAI, Feb 19 - China's largest sugar region of Guangxi expects to produce 7.6 million tonnes of sugar in the 2008/2009 crushing season, down 19 percent from a year earlier, a senior industry official was quoted as saying on Thursday.

Nong Guang, director of the local industry association attributed the loss to winter weather damage early last year and to too much rain later in the cane-growing period.

Most Chinese sugar mills complete crushing canes in April.

The lower output in Guangxi, which produces about 60 percent of the country's total output, was likely to drag down the country's total production this year. China produced a record 14.8 million tonnes of sugar last year.

To aid sliding domestic sugar prices and help farmers, the Guangxi government has agreed to purchase 400,000 tonnes from local mills for reserves, in addition to 800,000 tonnes already bought by the central government from this year's production.

The lower output projection failed to support domestic futures prices.

Zhengzhou white sugar fell 1 percent, with the most active September contract trading at 3,536 yuan ($517.2) per tonne by midday, in line with losses in raw sugar prices in New York.

source:alibaba