Casuco, while reporting the loss of VND26 billion, has decided to suspend the sugar production of the 2023-2024 crop at Phung Hiep sugar mill in Hau Giang province. The decision is attributed to the shortage of sugarcane materials as growers want to sell sugarcane to other buyers rather than the mill. 

A report of the Hau Giang provincial agriculture department showed that to date, farmers have harvested more than 2,000 hectares of sugar cane out of the total 3,200 hectares this crop, mostly in Phung Hiep and Nga Bay City. As such, 1,000 hectares of sugarcane have not been harvested.

According to Nguyen Van Hieu, a farmer in Tan Phuoc Hung commune of Phung Hiep district, in general, sugarcane is harvested after 10-12 months of growing. However, in recent years, as the sugarcane prices fluctuate all the time, instead of selling sugarcane to the mill, farmers prioritize to sell sugarcane in bundles of 10 plants to merchants who collect sugarcane for making drinks.

Under this selling mode, farmers estimate the weight of sugarcane plants and calculate the amounts of money buyers have to pay and deliver bundles of 10 plants to buyers, while there is no need to weigh merchandise and no requirement on CCS (commercial cane sugar) content.

“It doesn’t take much time to care for this kind of sugarcane. We can sell sugarcane just after 5-6 months of cultivation and we don’t have to pay high costs,” Hieu said. 

In most cases, when selling sugarcane under this mode, farmers can collect at least VND500 per kilogram higher than the prices paid by sugar mills. However, sales depend on merchants, who always try to force prices down.

The current sharp sugarcane price fall has put Nguyen Van Tien, a farmer in Tan Phuoc Hung commune, on tenterhooks as sugarcane is the major source of revenue of his family.

According to Tien, merchants contacted farmers in mid-October and came to collect sugarcane in bundles at VND2,300-2,500 per kilogram, but the prices have dropped to VND1,100-1,200 per kilogram. Meanwhile, merchants collecting sugarcane to sell to sugar mills pay less than VND1,000 per kilogram.

As prices are decreasing, merchants have requested to lower prices negotiated before, or will break the deals, accepting to lose deposits.

Farmers foresee that with the current harvesting pace, they will only finish the harvest after 2-3 months.

Tran Van Tuan from Phung Hiep district agriculture sub-department confirmed that merchants have unanimously forced the prices down after the sugar company’s decision to suspend Phung Hiep mill.

Tam An