Thursday, August 5, 2004
World sugar price seen up 10% by WTO ruling: Thailand
Reuters Bangkok, August 5
The World Trade Organisation's ruling against European Union sugar export subsidies will push world prices up by at least 10 per cent, Thailand's sugar industry said on Thursday.
Thailand, Asia's largest sugar exporter, ships around seven million tonne of sugar each year, both raws and whites.
"Thailand will gain from the ruling. The world sugar price is expected to rise by at least 10 per cent," said a senior official at the Thai Sugar Millers' Association.
The association calculated that EU will be forced to slash its sugar exports by at least two million tonne a year as a result of the ruling, the official said.
"Without the subsidy, EU will be unable to export sugar because its price is not competitive against sugar from Thailand, Brazil and Australia," he said. Thailand has a good chance to replace the EU in markets in Asia, West Asia and Russia, the official said.
The preliminary WTO ruling is confidential and a final ruling should be issued in September after both sides have had time to comment, although final rulings rarely differ from the preliminary ones.
Thailand took the case to the WTO along with Brazil and Australia, arguing that European subsidies had increased production artificially and depressed world prices.
Each side is able to appeal and it could be another year before the decision takes effect.
© HT Media Ltd. 2004.