Sugar surplus to weigh on Australian industry
http://www.sugaronline.com/website_contents/view/1205885December 20, 2012 at 2:14 PM
Global sugar production is expected to ramp up next year to record levels, presenting a challenge for the Australian cane industry which currently supplies 80% of its sugar to the world market, according to the Australian Broadcasting Corp.
China, India, Thailand and even Pakistan are all anticipating higher than average crop levels, meaning they won't be reliant on Aussie imports next year.
Green Pool Commodities analyst Tom McNeil says the high price of sugar in recent years has been an incentive for cane-growing nations to increase production, and now Australia is starting to see the impact.
"The world will be looking at a surplus of around nine million tonnes," he said.
"I think it will remain a cyclical commodity and I think Australian producers will continue to live in that sort of environment and have to make hedging decisions and planting decisions in light of a fairly volatile world market."
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