Affected by the severe floods this year, the supply of white sugar raw materials in China is relatively reduced. Affected by climate change from El Nino to La Nina, the floods in China this year are more serious than in the past few years. Guangxi, Fujian, Jiangxi and other areas where sugarcane cultivation accounts for a large proportion in China have all suffered floods. Among them, more than 500,000 mu of sugarcane in Guangxi Province, which accounts for more than 60% of the national sugar production, was affected. Sugarcane is one of the important raw materials for sugar production. The flooding in sugarcane planting areas will naturally affect the supply of white sugar in China.
China is the largest producer and consumer of white sugar in the world, and the shortage of white sugar has pushed up the price of white sugar. China's local white sugar production accounts for more than 60% of the total domestic consumption, but due to natural factors such as weather, the output of white sugar, which is already in the production reduction cycle, has dropped even more. In addition, with the gradual stabilization of the domestic epidemic, the resumption of work and production is progressing smoothly, domestic consumption is also slowly recovering, and the demand for white sugar, which was originally reduced due to the epidemic, is slowly returning to normal. This background of decreasing supply and increasing demand naturally pushed up the price of white sugar in the domestic market.
Domestic and foreign policies are also important factors affecting sugar. The main foreign sugar-producing countries are India, Brazil, the United States and so on. All countries have corresponding policies to intervene in sugar production, so that the price of sugar is kept below the domestic level. In addition, the subsidies and support measures for sugar production in the United States and other countries have further depressed the international sugar price. Domestic sugar is also subject to macro-control, and government departments such as the National Development and Reform Commission and the Ministry of Commerce will make adjustments according to the actual situation in China. In order to keep the price of sugar stable, protect the sugar and beet producers in China and protect the sugar industry, it is beneficial to control the price of sugar at a slightly higher level, which can avoid the impact of foreign investment.