China’s Sugar Capital Transformed

By Wang Zhe

Having fallen upon hard times, Guangxi Zhuang Autonomous Region's sugar producers are on their way back to success with the help of new investment and policy

The Sugarcane Labyrinth in Fusui County,Chongzuo.As a base for agriculture and science education, it is home to a collection of 280 species of sugarcane from the United States, Brazil,France, Australia,Thailand and other countries.

The Guangxi Zhuang Autonomous Region is China’s largest sugar producing base,while Chongzuo is the largest in Guangxi, thus nicknamed“China’s sugar capital”. The city has made full use of sugarcane crops and developed a large scale circular sugar industry. Cane juice can be made into cane vinegar — a healthy sweet and sour drink. It can also be made into blackstrap molasses plum candy, which is a snack very popular across China. A wide range of other sugar byproducts are also made available through sugar production — cane molasses can be processed into yeast, dried filter cake can be made into fertilizer and cane leaves and tail can even be made into an animal feed supplement.

As China’s largest sugar producer, Guangxi produces 60 percent of the country’s sugar.Chongzuo’s sugar output is about one-third of the region’s total, and one-fifth of the country’s total. However, in recent years, falling sugar prices in the international market had a negative impact on the development of the industry in the region. The enterprises and farmers in “China’s sugar capital”have fallen upon hard times.

The region’s government took action. It formulated an Overall Plan for Reinvigorating Guangxi’s Sugar Industry, with the aim of promoting the transformation and upgrading of its sugar industry and extending the whole industry chain of cane sugar.

According to the overall plan,Guangxi is going to build a China(Guangxi) Sugar Industrial Park in Chongzuo, consisting of the Sino-Thai (Chongzuo) Industrial Park, the China-ASEAN Nanning Airport Fusui Economic Zone and the Jiangzhou District Cane Sugar Circular Economy Industrial Park. On Sept. 15,2017, the construction of the China (Guangxi) Sugar Industrial Park officially kicked off. When completed, the park is expected to improve the region’s industry chain of innovation.

Growing Sugar Industrial Park

At the beginning of last November, on the eve of the 2017 China Sugar Expo, our reporter joined more than 100 domestic and foreign businessmen on a fact-finding tour to Chongzuo.

In the Youth Cane Vinegar Company located in the Sino-Thai (Chongzuo) Industrial Park,the visitors marveled at the cane vinegar that tastes sweet and sour, complete with the fragrance of sugarcane. They were informed that the cane vinegar is made from fermented raw cane juice. It suits most people’s taste better than the apple vinegar already commonly found in the market. With increased market demand, the company is planning to increase output. Quite a few visitors showed interest in this project.Wei Shaoyong, vice-president of the Zhujiang Xijiang Industrial Investment Fund Management Company, indicated clear intentions to provide financing for the company in the form of equity or creditor’s rights on the basis of an integrated assessment.

At the Guangxi Jinguan(golden crown) Food Company located in the China-ASEAN Nanning Airport Fusui Economic Zone, the visitors sampled blackstrap molasses plum candy and other snacks made from cane sugar. “Chongzuo has obvious advantages in cane sugar production,” said Wu Jinlong,the company’s manager. “It also enjoys geographical advantages.The local government has provided us with all kinds of support. That’s why we have chosen to build our factory here.At present, we are planning to build a new production line for more diversified products.”

The quality control department at the Youth Cane Vinegar Company located at the Sino-Thai(Chongzuo)Industrial Park.

In the same industrial park,reporters visited a joint venture of Lesaffre and Sungain Group.The French company is the world’s largest yeast producer.It is cooperating with Sungain on an active dry yeast project.“We are very close to raw material suppliers here, which gives us a cost advantage,” the plant’s French manager said.“In the next four-to-five years,we’ll continue to expand our production capacity. ”

In the Jiangzhou District Cane Sugar Circular Economy Industrial Park, the visitors were given a chance to examine a microbial fertilizer and straw feed project with annual capacity of 300,000 tons, the largest of its kind in Guangxi. Before we entered the workshop, the noise of the running machines was audible and the unique smell of fermented plants wafted toward us. According to the project manager, biological straw feed can greatly improve the absorption efficiency of planteating animals, while animal waste is the most convenient high-quality raw material for natural organic biological fertilizer. The operation of the project will help realize the industrialization of the circular economy of Chongzuo’s planting and breeding industry.

Vigorous Sugar Industry

“There is a huge consumer market for China’s sugar industry,” explained Yang Benpeng, director of the Sugarcane Research Center of the Chinese Academy of Tropical Agricultural Science.“The climate of southern China is most suitable for growing sugarcane. Tens of thousands of sugarcane farmers are making a living producing sugarcane crops on 1.5 million hectares of land.”

The traditional mode of production has led to stubbornly high production costs. To enhance the core competitiveness of the sugar industry, lowering sugarcane production costs and extending the sugar industry chain are vital. Liu Youming, secretary of the Chongzuo Municipal Party Committee, said that his city is treating this transformation as a tough but important challenge. To address the challenge, the city is planning to take steps in “three main tasks” — the first of which is to complete the construction of a 135,000-hectare high-yield, highquality sugarcane production base, ensuring that the total cane acreage surpasses 270,000 hectares and guaranteeing a supply of 20 million tons of sugarcane as raw material. The second task involves mergers and reorganizations of sugar producers to make them more refined, more specialized and stronger. The third task is the extension of the sugar industry chain to add value and enhance competitiveness.

China (Guangxi) Sugar Industrial Park is an important platform for the extension of the sugar industry chain. The construction of its top priority project, which is a pilot modern industrial complex of the Guangxi Chongzuo East Asian Sugar Industry Company benefiting from total investment of 2.75 billion yuan (US$425 million),was kicked off in September 2017. The land use of the project is 95 hectares. Its construction is expected to be completed by the end of November 2018. It will be a demonstration project of circular sugar production, combining sugar production with scientific education and tourism. This project is an integral part of the transformation and upgrading of Chongzuo’s sugar industry. It also represents a colorful chapter in Sino-Thai economic and trade cooperation.

In terms of mergers and reorganizations, Chongzuo has encouraged and guided local leading sugar enterprises, such as COFCO Sugar and the Nanning East Asian Sugar Industry Company,to actively participate. The market will play a leading role in this process, which will be conducive not only to the large-scale and professional development of the industry, but also to the precise and focused implementation of the government policy and financial support.

Since 2016, Chongzuo’s sugar industry has shown encouraging signs of improvement, with higher sugar yield, more timely payment to sugarcane farmers, rising sugar prices and significant improvement in benefits. In the 2016/2017 milling period, a total of 14.85 million tons of sugarcane were processed by the city’s sugar millers, leading to an output of 1.85 million tons of mixed sugar,topping China’s sugar producing regions for the 14th consecutive milling period.

With transformation and upgrading, a lot more is to be expected of Chongzuo’s revived sugar industry.