Fifteen firms won bids at the Ministry of Industry and Trade’s second auction of sugar import quotas in Ha Noi on Wednesday.

A worker operates a packaging machine at a KCP Vietnam Industries Limited sugar factory, an Indian-owned company located in Phu Yen Province. Viet Nam must import 89,500 tonnes of sugar this year, following its commitment to the World Trade Organisation (WTO). 

Viet Nam must import 89,500 tonnes of sugar this year, following its commitment to the World Trade Organisation (WTO). The commitment consists of 44,000 tonnes of raw sugar and 45,500 tonnes of refined sugar.

The bidding was organised by the ministry and the National Council of Pilot Sugar Quota Bidding 2017.

According to the council, there were 28 bidding application from businesses that have sugar import demand this year. All the applications were valid.

Three out of five companies won bids for import quotas of raw sugar, namely Bien Hoa Sugar Joint Stock Company, Thanh Thanh Cong Tay Ninh Sugar and Bien Hoa, Ninh Hoa Sugar Company Limited, securing a total import quota of 14,666 tonnes.

The State budget collected VND110 billion (US$4.9 million) from the bidding of 44,000 tonnes of raw sugar at the price of VND2.5 million per tonne.

Suntory PepsiCo Viet Nam was not eligible to join the bidding due to a lack of documents.

There were 12 winners for import quotas of refined sugar with the lowest price of VND1.82 million and the highest price of VND4.55 million per tonne, respectively.

The 12 companies included Interfood Shareholding Company with 1,000 tonnes, Sanofi Synthelabo Viet Nam Company 1,000 tonnes, Quang Ngai Sugar Company 4,500 tonnes, and Vinh Hao Mineral Water Joint Stock Company 1,000 tonnes.

Vina Coffee Bien Hoa Joint Stock Company won 7,000 tonnes, Frieslandcampina Viet Nam Company Limited 3,000 tonnes, Nestle Viet Nam Company 9,000 tonnes, and Kirin Viet Nam got 1,000 tonnes.

Perfetti van mele Viet Nam Company won 12,000 tonnes, Puratos Grand-Place Viet Nam Company 1,000 tonnes, Red Bull Viet Nam Company 2,000 tonnes, and Orion Food Vina won Company 3,000 tonnes.

Speaking at the auction, deputy minister Tran Quoc Khanh, the council’s chairman, said this was the second time Viet Nam had auctioned the use of duty quota to import sugar following its WTO commitments.

Results of the auction showed that most of the applications were valid, adequate and strictly adhered to guidelines in the preparation of the documents.

The ministry has distributed the entire sugar import quota this year to businesses through the bidding to ensure transparency and fairness, Khanh said.

He asked the winners to co-operate with the ministry in implementing necessary steps and regulations after the bidding.

In addition, he assigned the Import-Export Department to report the auction’s results to the Ministry of Agriculture and Rural Development and relevant agencies.

As per a ministry circular on managing import tariff quota for sugar this year, bidders can include traders who supply sugar for food manufacturing and traders supplying raw sugar for the production of refined sugar.

An auction was held for the first time in September 2016 for duty import quota of 85,000 tonnes of raw and refined sugar with the average price of VND1.53 million per tonne of raw sugar and VND1.69 million per tonne of refined sugar. The auction collected VND138 billion to the State budget. Eleven businesses had then won the tender.

The winning bid prices this year were higher than those of the previous year. However, world sugar prices have been low. Specifically, the price this month was $392 per tonne, lower than the $397 per tonne in the previous months.

The sugar selling price in the domestic market is VND15,000-VND16,000 per kilo or $666-710 per tonne.

Prior to 2015, import quotas were assigned for sugar producers and companies using sugar in their production, such as beverages and confectionery.

Viet Nam Sugarcane Association proposed several times to open the tender to all instead of assigning it to specific businesses to create a fair process. 

VNS