Food & Beverage: The next milling year is expected to drive sugar prices con
China Sugar More by domestic demand and supply fluctuations determined. China's sugar price fluctuations has two core elements: supply and demand changes in the domestic and international sugar price fluctuations. As China continues to implement import of sugar "quota license" (2009 to 1.945 million tons), and 70% for the state-run trade, so the volatility of the Chinese price of sugar is more determined by domestic supply and demand. Among them, the yield change is expected to be a key factor in sugar fluctuations. Fluctuations in the international market price of sugar can be linked through the domestic and foreign futures and to some extent the impact of the domestic sugar price movements.
Sugar production in China next crop season is expected to increase flat or cut. Comprehensive information, we expect the 09/10 sugar planting area of sugar will drop. Among them, the southern planting area of sugar cane, down 5%; northern sugar beet acreage dropped 27%. 09/10 Sugar sugar production is expected around 12.24 million tons of about 200,000 tons year on year cut about. However, sugar production in Guangxi rose to 7.93 million tons may be more than 08/09 increased 300,000 tons of sugar. Comparison of the sugar plantations, the decline
and government policy guidance is the main reason for the decline of sugar growing area. 09/10 Sugar causes of the decline of sugar cultivation main reasons: 1. Comparative effectiveness of sugar cultivation declined, farmers will plant less. Especially in the north area of sugar beet, sugar-based business-benefit considerations of individual and reduce the 09/10 sugar beet price of (expected). And even individual businesses to be shut down parts of the sugar beet sugar factories in north China. 2. Local policy guidance. Guangxi introduced a 09/10 crop season (the sugar of) purchase price policy for sugar cane: sugar cane 09/10 bought on regular crop season down payment to maintain price 260 yuan / ton level, and continue the whole region Unity Down payment of ordinary sugar cane purchase price. It also provides: 08/09 to 07/08 years of crop season and the average sugar yield in crop season as the base, 09/10 crop season municipalities, in principle, yield some sugar from the city is responsible for purchasing and storage, purchasing and storage costs incurred by the local financial commitment (increasing the amount of sugar by the regional economic commission approved); the policy objective of control is undoubtedly 09/10 sugar cultivation of sugar, particularly the provisions of the local financial commitment to purchasing and storage costs, making local governments to expand the enthusiasm of sugar cultivation decline.
Decline of sugar production under the crop season is the main reason for sugar prices to continue upward. We did pre-judging the trend had sugar: sugar recovery stage, but the smaller the probability of continued sharp rise. Prompted us to change the trend is expected that the 09/10 sugar sugar sugar growing area of decline. China's sugar production next crop season does not increase or decreased slightly, the price of sugar will increase the sustainability of the uplink. Meanwhile, the international price of sugar possible depreciation of the dollar Financial Capital speculation and other factors continue to ratchet up and push up through the interaction of Chinese sugar futures.
Investment advice: continue to maintain the sugar industry, "promising" rating. We recommend that investors concerned about the sugar industry companies. Sensitivity from the production point of view of scale and performance, we recommend the following order: Nanning Sugar (000 911), the grain Tuen River (600 737), your share of sugar (000 833), the callback may be overweight.
Key risk is that the actual sugar production to increase next crop season. Sugar yield and sugar not only the actual planting area, but also with the unit of production, sugar content was relevant. The climate change is affecting yields, sugar content was a key factor. 09/10 Sugar actual planting area of sugarcane has not yet clear, Guangxi sugar production may exceed the expected yield increase. So, sugar sugar in reserve under the pressure of the Library up to more difficult.
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