Mitr Phol urges government to hike sugar price as costs soar

June 8, 2022
The Nation |

Mitr Phol Group, Asia's largest sugar producer, wants Thailand's Commerce Ministry to be open to discussing the raising of sugar prices as the cost of the cultivation and production has surged by 40 per cent.

Speaking to the media during a tour around his factory in Suphan Buri province, Buntoeng Vongkusolkit, chairman of Mitr Phol Group, said the current surge in global prices of sugar was due to a reduction in supply after India, the world's largest sugar producer and second-largest exporter after Brazil, decided to curb its sugar export. He said it would not seriously impact Thai supply and exports.

He insisted that production right now is adequate for domestic consumption and for regular export. However, in his view, the issue of most concern is the rising cost of cane cultivation and production of sugar.

Diesel fuel and fertilizer are the main cause of his concern as the prices of those two have already increased by 40 per cent compared to the last harvest season.

"Our company and the Sugarcane Farmers Association have already sent our request to the Office of the Cane and Sugar Board several times so that they can raise the issue with the government. Sugar is a price-controlled commodity so we need to discuss it with the government before raising the price. We still hope that they will talk to us soon about the proper price," Buntoeng said.

When asked what is the appropriate price for sugar right now, Buntoeng did not respond. He said global sugar prices currently stand at around 19 cents per pound, so the price of Thai sugar should not be more than that level.

He urged the government to urgently consider raising the price of sugar before global sugar prices decline. 

He explained that the reason farmers and producers were still able to endure the present conditions were because the price of sugar is really good. However, when sugar supply increases to meet the demand but the cost of energy and fertilizer remains high, that would be the real crisis.