BRASÍLIA: Brazil is one of the countries to be included in a probe by the Chinese government over large sugar imports, the head of Brazil’s cane industry group Unica, Elizabeth Farina, told Reuters on Wednesday. Farina said Unica was notified by Brazil’s Foreign Ministry regarding the probe. It is expected to send preliminary comments to China’s government by Oct. 12. According to Farina, Australia, Thailand and South Korea will also be investigated.
Brazil is the world’s largest sugar producer and exporter and China is its largest buyer. The Asian country bought almost 10 percent of total Brazil center-south exports in 2015/16 of 23 million tonnes, according to data from Unica. “It is worrying, of course, since China is our largest buyer. They could adopt safeguards to protect their local industry,” Farina said. Safeguards are usually implemented through sharp increases on import tariffs, said the Unica’s head, adding that they could hurt the flow of sugar to China.
China said last week it was launching a probe into soaring sugar imports dating back to 2011 that it said was hurting the local sugar industry. The investigation is expected to take up to six months. “They (Chinese) said there was an increase of more than 600 percent on imports since 2011. We are still translating their documents to try to better understand their allegations,” Farina said. Unica said it hired a law firm with a branch in China to follow the probe.
Sugar producers around the globe suffered from a cycle of low international prices from around 2012 to 2015, when prices started to recover on expectations for a global sugar deficit. New York raw sugar futures are currently hovering around the highest levels in the last four years.
