Thai Sugar Industry Prepares For Sugar Price Floating, Expected To Be Implemented By the End Of 2017

The cane and sugar industry has been in talks with the government on the revised Cane and Sugar Act and sent representatives to join the National Legislative Assembly’s review committee on the amendment of the Cane and Sugar Act B.E. 2527 to ensure a circumspect review and allow the Act to be enacted by the cane crushing season late this year in the hope of quashing Thailand’s dispute with Brazil.

Mr. Sirivuth Siamphakdee, President of the Thai Sugar Millers Corporation Limited’s public relations working group has revealed that every relevant party, including governmental agencies, cane growers, and sugar mills, is working at full steam to reach a conclusion on the management approach after the current quota system is abolished and replaced by sugar price floating, so that it could be enacted by December 1, 2017, which will fall in the 2016/2017 cane crushing season. Although the Office of the Cane and Sugar Board (OCSB) proposed the draft Cane and Sugar Act B.E. 2527 to the Cabinet earlier, Section 77 of the Constitution B.E. 2560 prescribes that a public hearing must be held to consider opinions from all stakeholders from the governmental and private sectors as well as consumers. Therefore, OCSB invited public opinions again through its website and compiled a summary to be considered in the reviewing process and submitted to the Cabinet along with the draft Act. If approved, the draft Act will be put forward to the National Legislative Assembly (NLA) for review and subsequent enactment.

However, to expedite the enactment of the amended Act and ensure fairness to all parties and compliance with the international trade law, NLA has appointed a committee to review the amendment of the Cane and Sugar Act B.E. 2527. The committee is composed of representatives from governmental agencies, sugar mill entrepreneurs, and cane farmers so as to derive information on all necessary aspects and is working in parallel with OCSB to speed up the review process, so that the draft Act can be put into law by this upcoming cane crushing season.

The draft Cane and Sugar Act B.E. 2527 is part of the restructuring of the entire cane and sugar industry in a bid to strengthen it as well as quell the ongoing dispute with Brazil, which earlier accused Thailand of subsidizing its sugar exporters and domestic sugar producers, distorting the pricing structure. In essence, the amended Act aims to reduce the role of the government’s regulatory agencies and make way for the private sector to take part in the management of the cane and sugar industry, abolish the current sugar quota in favour of retail price floating, terminate the 160-baht subsidy program for cane growers, and add new definitions of sugar cane so that it can be used to manufacture of other kinds of products.

“Every party in both the governmental and private sectors related to the cane and sugar industry is trying to create a new and stronger system for the cane and sugar industry and hopes that the draft Cane and Sugar Act, which is being reviewed by the NLA-appointed committee with due circumspection, will be in compliance with international trade law, maintain fairness for all stakeholders, and not lead to any new issues that will give rise to disputes as in the past. This is so that the draft Act could be passed into law by December 1,” said Sirivuth.

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