The Sweet Success of Vietnam’s Sugarcane Industry: Climbing to the Top

Since 2021, Vietnam's domestic sugar industry has been witnessing a resurgence, following the implementation of trade defense measures on imported sugarcane products. Between 2011 and 2021, sugarcane fields witnessed a decline from 283,000 hectares in the 2011/12 crop year to just 146,938 hectares in the 2021/22 crop year. However, in the last three years, there has been a notable turnaround, with sugarcane fields now covering nearly 175,000 hectares, indicating a sweet revival for the industry.

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According to a report by the Vietnam Sugarcane Association, the total sugarcane cultivation area in the country for the 2023/24 crop year was 174,842 hectares, of which sugarcane area of farmers linked to selling raw materials to sugar factories accounted for 93% of the total sugarcane area in the country.

THE STRUCTURE OF SUGARCANE VARIETIES REMAINS IMBALANCED

Mr. Nguyen Van Loc, Chairman of the Vietnam Sugarcane Association, said that according to a summary of reports from the operating sugar factories in the 2023/24 crop year, the total harvested sugarcane area in 2023/2024 was 163,019 hectares, an increase of 11.4% (corresponding to an increase of 21,113 hectares) compared to the previous crop year. Meanwhile, the harvested sugarcane area in the 2022/2023 crop year was 141,906 hectares and 124,753 hectares in the 2021/2022 crop year.

Regarding sugarcane cultivation, according to a survey by the Vietnam Sugarcane Research Institute in 2024, the structure of sugarcane varieties nationwide in the 2024/2025 crop year includes 60 varieties. Of which, the KK3 variety had the largest planting area (accounting for 68.3% of the total sugarcane planting area in the country), followed by varieties such as: LK92-11 (9.3%); R579 (4.5%); and the rest are other varieties.

Compared to the structure of varieties in Thailand in 2024 (KK3 accounts for 97%, LK92-11 accounts for 1%, and other varieties account for 2%), the structure of sugarcane varieties in Vietnam, although more diverse (with more varieties), is tending to develop similarly to Thailand, as the area of the two main sugarcane varieties, KK3 and LK92-11, in Vietnam has gradually increased from 31% in 2017 to 77.6% in 2024.

“The sugarcane output in the 2023/2024 crop year reached 11,204,789 tons, an increase of 1,708,431 tons (corresponding to an increase of 17.9%) compared to the 2022/2023 crop year with 9,496,358 tons and 7,532,728 tons in the 2021/2022 crop year.”

Mr. Nguyen Van Loc, Chairman of the Vietnam Sugarcane Association.

However, Dr. Cao Anh Duong, Director of the Vietnam Sugarcane Research Institute, said that the current structure of sugarcane varieties in Vietnam is quite imbalanced, with the area of medium-maturing varieties accounting for over 90%, while the area of early-maturing and late-maturing varieties is both below 5%.

In some areas, due to the impact of the policy of buying sugarcane in bulk (not buying by sugar content), the area of some old sugarcane varieties with high yield and low quality such as R579, K88-92, K88-65, My55-14, etc., is tending to increase again. Meanwhile, sugarcane varieties with average yield but high sugar content such as ROC22, ROC27, VD93-159, etc., are still not widely used by farmers. This has had a significant impact on the average sugar recovery rate of sugar factories.

To continue researching and determining the appropriate structure of sugarcane varieties for ecological regions, from 2022 to 2024, within the framework of the research topic on potential-level research and 5 research cooperation contracts, testing of varieties between the Vietnam Sugarcane Research Institute and sugar factories: NASU, Lam Son, KCP, Tuy Hoa, and Vietsugar, from 2022 to 2024, 23 new sugarcane lines/varieties were introduced, including 12 Vietnamese hybrid lines/varieties and 8 imported varieties.

The initial results have identified a number of promising lines/varieties with high yield and quality such as VN12-9-2, VN12-64- 25, VNN08-14-12, KK07-250, U-thong 15, U-thong 17, CSB06-4-162, NSUT10-266, YZ08-1609, etc.

Regarding sugarcane cultivation, the mechanization rate in land preparation currently reaches a very high level (over 90%). However, mechanization in care, weeding, fertilization, and harvesting is still very limited. Some large enterprises in localities with the potential to create large fields have invested in machinery and equipment to mechanize relatively synchronously and professionally from land preparation to harvesting, achieving high efficiency and reducing production costs. Currently, there are over 50 combined sugarcane harvesting machines in the country, meeting about 15% of the demand for mechanical sugarcane harvesting.

In the 2023/2024 crop year, many sugar factories promoted the application of mechanization in sugarcane irrigation, applying new irrigation techniques such as spraying and drip irrigation. Most of the sugarcane areas that were invested in care and irrigated properly according to techniques significantly improved sugarcane yield, quality, and economic efficiency compared to non-irrigated areas.

Some sugarcane enterprises… through technology transfer cooperation programs (such as An Khe Sugar Factory) or sponsored by foreign countries (such as sugarcane farmers in Thanh Hoa province) are piloting the application of new 4.0 technology solutions such as RICULT (USA), VIGREEN (Australia), etc., to digitize the management of the sugarcane value chain.

These enterprises have supported farmers in sugarcane cultivation activities with digital devices to monitor and analyze the growth of sugarcane, early detection of risks and limitations of damage; accurately predict yield; estimate the time of sugarcane maturity along with the corresponding area to have an appropriate purchasing strategy.

In addition, in many sugarcane areas, unmanned aerial vehicles (drones) have also been widely applied to spray pesticides, helping to effectively control sugarcane pests and diseases, especially in the stage of large sugarcane.

SUGAR OUTPUT INCREASES

Mr. Nguyen Van Loc said that in the 2023/24 sugarcane crop year, the factories in the industry crushed 11,204,789 tons of sugarcane and produced 1,107,777 tons of sugar of all kinds. Compared to the 2022/2023 sugarcane crushing season, sugarcane crushing volume in the 2023/2024 crop year increased by 17.9% and sugar production increased by 18.4%. Compared to the 2020/2021 sugarcane crushing season, in the last 4 consecutive crushing seasons, sugarcane crushing volume increased by 66% and sugar production increased by 61%.

“Especially in terms of sugar yield, in the 2023/24 crop year, Vietnam reached a sugar yield of 6.79 tons of sugar/hectare. Compared to the major sugarcane-producing countries in the region, including Thailand, Indonesia, and the Philippines, this achievement has, for the first time, put the Vietnamese sugarcane industry in the top position in terms of sugar yield in the region.”

Mr. Nguyen Van Loc, Chairman of the Vietnam Sugarcane Association.

This shows that, since 2021, after Vietnam applied trade remedies to some imported sugar products, the Vietnamese sugar industry has witnessed a significant revival and growth. Notably, the price of sugarcane has been continuously increased by the Vietnamese sugar industry for 5 consecutive crop years (an increase of 152% compared to the 2019/20 crop year), from only VND 0.85-0.9 million/ton in 2020 to currently VND 1.2-1.3 million/ton of sugarcane.

“This sugarcane price is equivalent to that of the major sugarcane-producing countries in the region (compared to the price of sugarcane in the 2023/24 crop year in Thailand of 38.9 USD/ton, equivalent to VND 935,000/ton, the price of sugarcane bought by the Vietnamese sugar industry is VND 1,267,993/ton, higher than Thailand’s by 35%). This has led to an increase in the area of sugarcane cultivation, and continuous increases in sugarcane and sugar production in the last 4 crop years,” said Mr. Loc.

The 2023/24 crop year also witnessed a significant shift in sugarcane production. The Central – Highlands region, with its competitive advantages in agriculture and processing industry, has achieved remarkable growth, increasing by 96% compared to the 2020/21 crop year. With 62% of sugar production, this region has become the largest sugarcane production center in the country.

“In terms of the market, the price of sugar sold by domestic factories is lower than that of other countries. Specifically, the price of sugar in the Philippines is 193%, Indonesia is 106%, and China is 107% higher than that of Vietnam. Thus, in the 2023/24 crushing season, the Vietnamese sugar industry has shown its true competitiveness in achieving the dual goal of increasing the price of sugarcane purchased to a level equivalent to or higher than that of countries in the region while still maintaining the lowest sugar price,” affirmed Mr. Nguyen Van Loc.

An Khe Sugar Factory – Gia Lai.

On September 12-14, 2024, in An Khe town, Gia Lai province, the Vietnam Sugarcane Association will organize a “Conference to Review the 2023/24 Sugarcane Production” to assess the competitiveness of the Vietnamese sugarcane industry and its development orientation. Along with this is a workshop on “Improving the Competitiveness of Vietnam’s Sugarcane Industry” to share technologies and experiences to improve the productivity, quality, and reduce the cost of sugarcane and sugar production.

Within the framework of the event, there will be many activities, including: Exhibition of Vietnam’s Sugarcane Agro-Industry; Culture, Sports, and Art Festival of the Sugarcane Industry; Commendatory Ceremony for Outstanding Sugarcane Farmers. Delegates will also visit An Khe Sugar Factory, sugarcane material area of Nghia An commune, Dak H’Lo, Kong B’La, LÆ¡ng KhÆ¡ng, TÆ¡ Tung communes, and the Anh Hung Nup Memorial House in StÆ¡r resistance village…

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