Sugarcane price poised to hit B950

       Sugarcane farmers will enjoy a record high cane price of nearly 1,000 baht a tonne this season, thanks to the global sugar deficit that has pushed up global sugar prices to a 28-year high.
       "Cane farmers can expect to gain 950 baht a tonne during this 2009-10 harvesting season, a record high in local cane history," said Prasert Tapaneeyangkul, the secretary-general of the Office of the Cane and Sugar Board (OCSB).
       The price is for cane with a commercial cane sugar (CCS) rating of 10,the total recoverable sugar percentage.
       The government's record high price is calculated based on the export sugar quota, of which around 70% has been committed to sales contracts at a high 19.75 US cents per pound at the exchange rate at 35 baht per dollar.
       "This is the highest price ever for the local cane industry. Farmers should be happy as it is a considerable increase from 830 baht per tonne they earned last year while the cost of production is relatively unchanged from the previous year. It is a wonderful year for the sugar industry," Mr Prasert said.
       The early arrival of winter breezes should also enhance cane sweetness.Mr Prasert said that 70% of cane farmers may have output with a higher CCS of 12.28, for which they may earn up to 1,043 baht per tonne.
       The OCSB expects the factories to start crushing this month. It hopes to see 71.44 million tonnes of cane crushed in this season, a 7.49% increase from 66.46 million tonnes last year. The rise in production is the result of good cane prices since last year which attract more growers.
       Sugar production is expected to reach 7.61 million tonnes this year, a 6% increase from 7.18 million tonnes produced last year, with 5.5 million tonnes allocated for export sales.
       The board also agreed to increase domestic sugar allocation to 2.1 million tonnes from 1.9 million last year.
       "This is because we expect food processors for export, who usually purchase cheaper export sugar, to shift to domestic sugar as the export price may be more expensive than the local one,"Mr Prasert said.
       At present, the domestic price is much cheaper than the export price.