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11/02/09 - Commodity Online Drastic drought to hit China sugar output

BEIJING (Commodity Online) : Unprecedented drought that hit Most of China's
fertile regions is likely to hit its sugar output for next crop year,
according to Ministry of Agriculture.

The total area under sugar is expected to fall by 8%, while the area under
beets is estimated to fall by more than 50%, resulting in a significant drop
in beet sugar output from the previous year, said the ministry in a report.

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China, the world's third-largest sugar producer and second-largest consumer,
is expected to start crushing later this month.

The country's sugar output for the 2008-09 crop year totaled 12.43 tons,
down from 14.84 million tons the previous year.

Dragon nation's sugar production for the 2009-10 crop year, which began Oct.
1, will likely fall due to shrinking area and erratic weather, experts said.

A decline in fertilizer expenditure and a nationwide drought have also
affected the crops, they said.

China's total sugar output should be lower than 12 million metric tons, as
area and output drop in most growing regions, except Guangxi Zhuang
Autonomous Region, according to Guangdong Sugar Association.

Output in Yunnan and Guangdong provinces, the second- and third-largest cane
sugar producing regions, is expected to fall by 185,000 tons and 60,000 tons
to 2.05 million tons and 1 million tons respectively, while Guangxi output
is expected to remain steady from the previous crushing at 7.63 million
tons.

Ministry officials said although a deficit is expected in the 2009-10 crop
year, plentiful state reserves and committed imports from Cuba can meet
domestic demand.