Millers urge liberalisation of sugar, cane

"Although we're happy that cane growers can get a better price, the

government should consider the effects in all dimensions and solve the problem in the long run," said Prakit Pradipasen, chairman of Thai Sugar Millers Corp.

"What will the government do if the primary price of cane in the next harvesting season is lower than growers' production costs like this year? Borrow from banks?" he said.

The state should float cane and sugar prices and help growers develop new species and increase yields.

The yield here is quite low at 9 tonnes per rai, while other countries such as Brazil produce 20 tonnes.

"If we can boost our yield to 15 tonnes, sugar mills will achieve better economies of scale and cane growers will get more income, too," he said.

Nutthapol Asdathorn, executive director of Thai Rung Rueng Group, said he believed that the hike of Bt5 per kilogram would not have a serious effect on the cane and sugar industry. What concerns him is the industry's readiness to handle the implementation of Afta.

"To liberalise the cane and sugar industry is necessary because we will not able to control the sugar price in the global market. Despite the pact, some countries still have barriers to sugar from Thailand," he said.

If the state wants to sustain the cane industry by promoting ethanol, it should seriously consider revising the Excise Department's law controlling ethanol as a drinking alcohol.

"Otherwise, it will be very difficult for ethanol producers to decide on further investment if the state doesn't take the obvious direction," he said.