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VSSA proposes self-defense measure against HFCS
By Trung Chanh
Monday,  Aug 20, 2018,13:25 (GMT+7)

VSSA proposes self-defense measure against HFCS

By Trung Chanh

Hau Giang Province’s farmers harvest sugarcane. VSSA proposes self-defense measure against high-fructose corn syrup (HFCS) - PHOTO: TRUNG CHANH

CAN THO – The Vietnam Sugar and Sugarcane Association (VSSA) has written to the Government calling for an investigation into the import of high-fructose corn syrup (HFCS) and the application of a special self-protection measure against this sugar-like substance due to the negative influence of the imported product on the domestic sugarcane sector.

In the letter sent to the Prime Minister, VSSA noted the difficulties being faced by the sugarcane sector and suggested some solutions.

Pham Quoc Doanh, chairman of VSSA, stated that despite taking various positive steps to maintain production, including flexibly adjusting sales plans, sugarcane firms have failed to raise sugar consumption and prices.

Accordingly, sugar prices reported at factories have recently fallen to VND11,000-11,500 per kilogram for refined standard sugar, dropping by 30% year-on-year, resulting in some factories leaning toward losses.

In addition to the Thai sugar being smuggled into the country, the large volume of HFCS imports has seriously affected the Vietnamese sugarcane sector, according to VSSA.

The letter claims that a type of HFCS popularly imported into Vietnam is HFCS-55, with 55% fructose, which is 1.1-1.3 times sweeter than sugarcane.

HFCS is mostly replacing sugarcane in the production of food, drinks and medicines, showing direct competition with sugarcane.

Statistics from the General Department of Vietnam Customs indicate that the imported HFCS volume skyrocketed in the 2015-2017 period, with some 67,800 tons in 2015, 70,000 tons in 2016 and some 89,300 tons in 2017, up 31.7% against 2015.

In terms of the price, the VSSA letter notes that HFCS is getting cheaper. One ton of HFCS was priced at US$496 in 2015, US$460 in 2016 and US$398 in 2017, while one ton of sugarcane cost US$630 in 2015, US$726 in 2016 and US$702 in 2017.

HFCS enjoys a zero import duty policy with an unlimited quota, in line with prevailing regulations, whereas sugarcane is subject to a quota regime, according to VSSA.

Cheap prices and a preferential import tax policy make HFCS more attractive to food and beverage firms, leading to low consumption of local sugarcane.

In the three-year period, domestic sugarcane firms incurred a loss of an estimated VND527 billion, according to the document.

VSSA stated that if the Government does not intervene and address these problems, the sugarcane sector will suffer greater losses, which may lead to the closure of small factories.

VSSA has thus proposed the Government adjust preferential tax policies for sugarcane and HFCS products, suggesting a probe should be launched into HFCS imports and a self-defense measure should be applied against the sweetener.

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