Thai July sugar exports fall 24% on month on tight supply

August 25, 2020
S&P Global Platts |

Singapore — Thai sugar exports fell 24% on the month in July, which traders attributed to tight supply which forced destination buyers to seek alternative, more competitively priced origins.

Total sugar exports from Thailand in July were 428,174 mt -- comprising 204,761 mt of raw sugar, 26,908 mt of low-quality whites and 196,505 mt of high-quality whites -- compared with 559,938 mt in June, data released Aug. 25 from the Thai Sugar Millers Corp. showed.

Raw sugar exports between January and July were down almost 20% year on year at 2.7 million mt.

While Indonesian imports of Thai raw sugar over January-July were little changed year on year at 1.94 million mt, traders said Thai export sales into Indonesia would likely fall further in the third and fourth quarters.

Indonesia is the top importer of Thai raw sugar and typically accounts for 60%-70% of Thailand's total raw-sugar exports.

Due to a small Thai crop that has driven cash premiums to high levels, Indonesian buyers have switched to more competitively priced Indian and Brazilian raw sugar.

According to a shipment report, Indonesia imported 404,947 mt of bulk raw sugar from India between Jan. 1 and Aug. 6.

Thai January-July white sugar exports fell by 6% year on year, to 1.8 million mt, according to TSMC data.

July shipments to Vietnam slumped to 61,625 mt from 89,850 mt in June and 101,530 mt in May.

The drop in exports to Vietnam was mainly attributed to a drop in domestic prices caused by a large import program in the first half of 2020.

The Vietnamese domestic white sugar price was heard around Dong 11,000-11,500/kg ($470-$500/mt), compared with Dong 13,000/kg earlier this year.

Traders also said the surge in London No. 5 white sugar futures in recent weeks had also made Thai prices unattractive for sales to Vietnam.

"Regional demand for whites will be weak in Q3 as the Philippines and Vietnam are importing less. We are also at the tail end of the Thai crop so there is not much left to be exported," a Singapore-based trader said.