Sustainability Issues and Opportunities for Sugar and Integrated Industries in ASEAN Region

Abstract

The ASEAN nations play a significant role in the global sugar trade, collectively contributing approximately 10% of the world’s sugar production. These countries produce over 17 million tons of sugar annually, with imports and exports amounting to 9,108,624 tons and 7,421,737 tons, respectively, while domestic consumption stands at 15,836,900 tons. Thailand holds the position of the second-largest sugar exporter globally, commanding a 60% share of exports after Brazil. Indonesia ranks as the world’s third-largest sugar consumer and a significant importer. The Philippines, another sugarcane-producing country, focuses primarily on domestic consumption but aims to transition into a net sugar exporter. Southeast Asian countries represent 13% of global centrifugal raw sugar exports and 14% of global sugar imports, thereby exerting considerable influence on the global sugar trade. The annual import volume across ASEAN countries typically ranges from 5 to 6 MT, with cane sugar being the primary internationally traded sugar commodity from the region. Despite having favorable conditions, cane productivity, sugar production, and the overall status of the sugar industry in these nations face region-specific challenges. Sugarcane cultivation across ASEAN nations have been affected by climatic changes such as the El Niño phenomenon over the years. The governments of ASEAN Nations are taking initiatives to overcome this challenge. Recent economic developments, such as the establishment of the ASEAN Economic Community (AEC) and the ASEAN Free Trade Area (AFTA), alongside related reforms, have spurred these countries to adapt to emerging circumstances and enhance global competitiveness. This review highlights the current state of the sugar industry in the ASEAN countries, the challenges encountered by these nations in this sector, government initiatives to boost sugarcane production, and the way forward, particularly in light of new economic developments in the region.

Introduction

The Association of Southeast Asian Nations (ASEAN) functions as a regional coalition aimed at fostering economic, political, and security cooperation among its ten member states viz. Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. These nations exhibit diverse economic, political, and social landscapes. Singapore leads in GDP per capita at $83,000 according to 2022 World Bank data, while Myanmar records the lowest at around $1,100 (source: https://www.cfr.org). O’Neill (2023) reported Indonesia as having the highest GDP per capita at US$1,417.39 billion, in contrast with Laos PDR’s lowest at US$14.24 billion. Political systems across ASEAN members vary, reflecting distinct demographics and governance structures (source: https://www.cfr.org). With a collective population of approximately 662 million and a GDP surpassing US$3.2 trillion, ASEAN has experienced a significant increase in economic strength in recent years. The group has become a key player in Asian economic integration, participating in negotiations for the world’s largest free trade agreement and sealing six free trade pacts with neighboring economies. Despite inherent disparities, ASEAN remains a cohesive force, poised for further growth. Projections suggest the region’s GDP could reach US$10 trillion by 2030. Leading East Asian dynamics, ASEAN stands as one of the world’s fastest-developing regions, offering ample opportunities for business ventures and investments.

The Southeast Asian region encompasses several nations that play pivotal roles in the global sugar market, including Thailand, Indonesia, the Philippines, Vietnam, Myanmar, Laos, Cambodia, Brunei, and Malaysia. Together, these countries contribute approximately 22% of the world’s sugarcane production (Solomon 2014). Within ASEAN, sugar ranks as the second most significant food commodity, with production totaling around 17 million tons (MT), accounting for 9–10% of global output. Annual sugar consumption within ASEAN reaches 14 million tons, with per capita consumption ranging from 10 to 20 kg per year, indicating substantial growth potential for the industry. The annual import volume across ASEAN countries averages around 5–6 MT, with cane sugar being the primary internationally traded sugar variety from the region. The establishment of the ASEAN Free Trade Area (AFTA) has been nearly completed, with notable progress among ASEAN member states in reducing intra-regional tariffs through the Common Effective Preferential Tariff (CEPT) scheme for AFTA. Over 99% of the products listed in the CEPT Inclusion List (IL) of ASEAN-6—comprising Brunei Darussalam, Indonesia, Malaysia, the Philippines, Singapore, and Thailand—have seen tariffs lowered to the 0–5% range.

The newer members of ASEAN, including Cambodia, Laos, Myanmar, and Vietnam, have made significant progress in fulfilling their CEPT commitments, with nearly 80% of their products now included in their respective CEPT Inclusion Lists (ILs). The ongoing process of trade liberalization within ASEAN presents lucrative opportunities for sugar exports to the region but also intensifies competition among member states. ASEAN countries hold substantial sway in the global sugar trade landscape. Thailand ranks as the world’s second-largest sugar exporter after Brazil, with trade volumes exceeding 268,706 tons in the 2022–2023 period (Table 1). Indonesia ranks as the third-largest consumer globally and a significant importer of sugar. The Philippines, another key sugarcane producer, historically focused on domestic consumption; however, amid evolving circumstances, the country aims to bolster sugarcane and sugar production to transition toward becoming a net sugar exporter. In 2023, ASEAN countries collectively produced 167,177 thousand metric tons of sugarcane, yet with improved facilities and management, production could potentially reach 200 million tons. The self-sufficiency ratio, indicating the ratio of sugar production to domestic consumption, is highest in Thailand at 442% and lowest in Indonesia at 34.2% (Tables 1, 2, and 3).

Table 1 Sugar production, imports, domestic utilization, exports and ratio in ASEAN Countries.

Table 2 Sugarcane production (in thousand metric tons) in ASEAN Countries.

Table 3 Sugarcane Area (ha) and Yield (t/ha) in ASEAN Countries

On June 20, 2023, MSM Malaysia Holdings Bhd (MSM) formally became a member of the ASEAN Sugar Alliance (ASA) by signing a memorandum of understanding (MoU), signifying its participation in a collaborative effort within the sugar industry. The ASEAN Sugar Alliance, established in July 2016 in Bangkok, serves as a platform for leading sugar manufacturers from Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Thailand, and Vietnam to engage in dialogue and cooperate on matters of mutual interest. Its main objectives include advancing industry development, boosting regional competitiveness in the global sugar market, and fostering cooperation among member nations. Initially led by Thailand for a two-year term, the alliance aims to utilize provisions outlined in Thailand’s Cane and Sugar Act of 1984. These provisions encompass mechanisms for revenue sharing between farmers and millers, the establishment of an industry board, and the creation of emergency funds to support millers and farmers during periods of price volatility or adverse weather conditions.

The Philippines Sugar Industry

The Philippines is a significant player in the ASEAN sugar industry, though its average productivity is relatively low at around 65 tons per hectare. Approximately 90% of the sugar produced is consumed domestically, which contributes to high local prices due to the industry’s heavy protection. Despite these challenges, the sugar sector contributes approximately P70 billion annually to the Philippine economy and provides livelihoods through farming, processing, and trading activities. Around 80,000 sugarcane farmers operate on 424,199 hectares of land, a fraction of the Philippines’ total land area, employing about 700,000 people directly and benefiting an additional 5–6 million indirectly. These farmers collectively cultivate an area averaging 57 tons per hectare, with most farms being small, typically under 10 hectares, while only a few exceed 100 hectares. According to Mendoza (2019) for every 3 tons of sugar produced, one worker is directly employed, while approximately seven others find indirect employment opportunities.

Recent data indicate sugarcane cultivation spans approximately 19,434 hectares, yielding a total sugar production of 1.8 million tons. This production is supported by 24 operational sugar centrals with a combined milling capacity of 17,400 metric tons of cane per day, 14 refineries with a combined capacity of 8,000 metric tons per day, and 6 biomass-generating plants. Geographically, the Visayas region is crucial, contributing about 65% of the nation’s total sugar output, with Negros Island being the largest sugarcane cultivation area (https://www.sra.gov.ph/). Western Visayas is the largest producer, contributing 55% of the total output. However, severe drought attributed to the El Niño phenomenon has impacted nearly 100,000 hectares of sugarcane plantations in Negros, significantly reducing production (GMA integrated News, January 24, 2024, Bayoran 2024).

The primary challenge facing the Philippine sugar industry is yield inefficiency. Approximately 85% of farms are small-scale, covering less than 10 hectares, producing around 50 metric tons per hectare, while larger farms average 80 metric tons per hectare. This is considerably lower than other Southeast Asian countries like Thailand, which averages 100 tons per hectare. Factors such as suboptimal planting materials, soil fertility issues, inadequate irrigation, and the adverse impacts of climate change contribute to this productivity gap (World Wide Fund 2019). Improving productivity requires enhanced planting materials, optimized fertilizer use, and more efficient irrigation systems (FFTC-AP, https://ap.fftc.org.tw/article/1841). Processing inefficiencies also plague the industry due to numerous small-scale operations, necessitating the modernization of these facilities to enhance overall competitiveness.

In addition to production challenges, sugar producers in the Philippines face concerns about the impending reduction in sugar tariffs under the ASEAN Free Trade Area (AFTA). The scheduled tariff cut from 38 to 5% starting January 2015 could impact the domestic market significantly. The Sugar Regulatory Administration (SRA) manages Philippine sugar policy, working closely with industry stakeholders to regulate trade and domestic prices. At the beginning of each crop year, the SRA issues policies on production and marketing, including production quotas for domestic consumption and export (Tobias 2020). For the 2023–2024 marketing year, the SRA allocated the entire estimated production of 1.85 million metric tons for domestic consumption, though production estimates might decline by 10–15% due to El Niño (Florence, 2024).

Approximately 90% of the sugar produced in the Philippines is consumed domestically, with a small portion exported, predominantly to the United States. This stands in stark contrast to Thailand, which exports about 8 million metric tons of sugar annually. In the 2022–23 crop year, the Philippines produced approximately 640.91 thousand metric tons of refined sugar, marking a decline over the past six years (Table 4) (Statistica 2023). The highest demand was for raw sugar, totaling about 1.7 million metric tons. Refined sugar withdrawals varied from 10,524,897 metric tons in 2022–23 to 15,510,362 metric tons in 2018–19 (Table 4).

Table 4 Refined sugar production and Refined and raw sugar withdrawals in the Philippines over 5 years

Domestic sugar prices in the Philippines are typically higher than international rates. For example, retail prices of raw sugar in Metro Manila during November 2019 ranged from PhP 42 (US$ 0.08) to PhP 56 (US$ 1.10) per kilogram. Sugar consumption is predominantly by industrial users (65%), followed by institutional users (13%) and households (22%) (Fig. 1).

Fig. 1

Sugar consumption distribution by different consumers in the Philippines

The Philippine sugar industry faces significant challenges in both productivity and processing inefficiencies. Addressing these issues through improved agricultural practices and modernized processing facilities are essential for enhancing competitiveness. The management of tariffs and regulatory policies by the SRA will continue to play a crucial role in shaping the industry’s future.

Indonesia Sugar Industry

Indonesia, a significant sugar-producing nation in Southeast Asia, ranks as the seventh-highest consumer of sugar globally and the second-largest sugar importer after China. In 2023, sugarcane output reached approximately 2.27 million metric tons, resulting in total sugar production of 2,271,009 tons in 2023 and 1,923,036 tons in 2024 (Table 1). Historically, Indonesia was a major sugar exporter, second only to Cuba in the early 1930s, producing nearly 3.0 million tons of sugar and exporting 2.2 million tons to Europe. However, over the past 45 years, the country has become a net importer due to rising domestic consumption outpacing production. Predictions indicate that sugar consumption for 2022–23 will rise to 7.8 million metric tons (MMT) of raw sugar equivalent, up from 7.6 MMT in 2021–22. Correspondingly, 2023–24 sugar consumption is anticipated to reach 7.9 MMT of raw sugar equivalent, with 4.1 MMT for direct consumption and 3.7 MMT for the food and beverage industry. The demand for refined sugar in this sector in 2023–24 is expected to grow by 5 percent to 3.64 MMT (equivalent to 3.9 MMT of raw sugar) compared to 3.45 MMT (3.7 MMT of raw sugar equivalent) in 2022–23. Consequently, refinery running capacity for 2022–23 is projected to reach approximately 78% (Meylinah 2023).

The forecast for sugar consumption per capita in Indonesia suggests a continuous increase of 2.8 kg per capita (+ 10.11%) over the coming years. Therefore, sugar consumption per capita is estimated to reach 30.52 kg per capita by 2031. The OECD predicted Indonesia’s sugar consumption to be approximately 28.23 kg in 2023, up from 27.67 kg in 2022. An increased allocation for raw sugar imports, coupled with heightened demand for refined sugar from the food and beverage industry, is expected to elevate refinery running capacity. In 2021–22, running capacity increased to 70%, compared to 66% in 2020–21 (Meylinah 2023). As Indonesia progresses with its COVID-19 immunization program introduced in January 2021, fewer social distancing measures and travel restrictions are anticipated to reduce domestic sugar consumption. Conversely, the rising demand within the food and beverage industry is poised to drive up the consumption of refined sugar.

Sugar production significantly influences pricing, supply, and market dynamics within Indonesia. While domestic production helps to reduce dependency on imports and fosters market stability, there remains a notable disparity between growing demand and domestic production capacity. Thus, Indonesia heavily relies on imports, with Thailand being its primary supplier due to advantageous freight terms, particularly meeting Indonesia’s specific requirements (known as Indospec). To mitigate and stabilize retail prices, the Government of Indonesia (GOI) has authorized the importation of 991,000 tons of plantation white sugar in 2022–2023. In 2023, sugar imports reached approximately 2.9 billion U.S. dollars, with Thailand, Brazil, and Australia emerging as the largest exporters to Indonesia during this period (Nurhayati-Wolff 2024).

The Indonesian sugar industry faces challenges due to aging infrastructure, with approximately 40 mills being over a century old, while only six are less than 25 years old. Outdated machinery in these mills results in low recovery rates, discouraging farmers who could earn higher profits from cultivating other crops. Both state-owned and private sugar mills rely on smallholder farmers for sugarcane supply. State-owned mills are also aging, with around 37 out of 43 being over a century old. As private companies adopt more efficient machinery and technology, the contribution of state-owned mills declines. Moreover, state-owned companies experience a decrease in sugarcane plantation ownership compared to private firms. Between 2016 and 2021, the plantation area of state-owned companies decreased annually by 4.33%, while that of private companies grew by 5.99% per year. In 2022, state-owned mills accounted for 47.9% of the total national plantation area, with white sugar production reaching 49%, a slight increase from 45.1% in 2021 (Table 5).

Table 5 Growth of the Indonesian sugar industry over the years.

The aging machinery across the industry results in an average 5-year recovery rate of only 7.4%. Despite the recent increase in workers returning from the COVID-19 pandemic, higher moisture content due to increased rainfall is estimated to reduce the recovery rate to 6.6% in 2022–23, compared to 7.25% in 2021–22. However, the recovery rate is projected to bounce back to 7.4% in 2023–24 due to less rainfall, increasing the sucrose content in sugarcane. Private sugar mills are expanding, leading to increased production in 2022–2023. The El Nino phenomenon is forecasted to increase plantation white sugar production in 2023–24 to 2.6 MMT. But imports of raw sugar are expected to rise primarily due to increased demand from refineries. During 2023–2024, 450,000 metric tons of centrifugal sugar are imported while 5630,000 metric tons of sugar are exported from the country (Table 6). To mitigate and stabilize retail prices, the GOI has granted permits to import 991,000 tons of plantation white sugar in 2022–23.

Table 6 Centrifugal Sugar production, consumption, imports and exports in Indonesia.

Currently, Indonesia operates a total of 62 sugar mills, with a national installed capacity of 316,950 TCD. Among these mills, 43 are under state-owned management, while 9 are privately owned. The primary sugarcane-producing regions in Indonesia include East Java (47%), Lampung (32%), and Central Java (8%). In 2021, BPS reported that smallholder farmers contribute approximately 56% of the total sugarcane area, with the remaining area managed by state-owned and private companies. The area managed by smallholder farmers is decreasing due to infrastructure development and competition with other high-margin food crops such as corn and paddy. However, expansion by private companies’ areas, which grew by 5.98% outside of Java and 6.17% on Java Island, has offset the decline in smallholders’ areas. Consequently, the harvested area in 2023–24 is projected to increase to 490,000 hectares due to area expansion in Sulawesi and Sumatera, where new mills have been constructed (Meylinah 2023).

According to the USDA report, the retail price of plantation white sugar in Indonesia has increased due to rising production costs and growing demand. The Government of Indonesia (GOI) released a guideline from the National Food Agency in December 2022, setting reference prices for various commodities, including sugar, to regulate pricing. The reference prices for plantation white sugar are set at Rp. 11,500/kg ($768/MT) for producers and Rp. 13,500–Rp. 14,500/kg ($901–968/MT) for consumers. As of 2022, the new reference price at the consumer level stands at Rp. 13,500 per kg ($901/MT), representing an increase of 0 to 7.4%. The average retail price is Rp 14,400/kg ($961/MT), up 0.8% from Rp 14,283/kg ($954/MT).

Changing dietary habits, health concerns, and consumer preferences influence the sugar market, prompting producers to adapt their production methods and impacting the food and beverage industry. To bolster the bioethanol industry and work toward achieving sugar self-sufficiency, on November 4, 2022, President Joko Widodo (Jokowi) inaugurated the “Bioethanol from Cane for Energy Security” program at the bioethanol factory of PTPN X’s subsidiary PT Nusantara Agro Energy (Enero) in Mojokerto city, East Java. This initiative aims to attain sugar self-sufficiency within five years and produce 1.2 billion liters of bioethanol by 2030 through expanding sugarcane cultivation to 700,000 hectares.

The Government of Indonesia (GOI) had previously initiated a similar self-sufficiency drive in 2009, focusing on expanding land and revitalizing sugar mills. While the 2009 program resulted in a 12 percent increase in local sugar production, reaching 2.05 MMT by last year, it fell short of meeting the GOI’s self-sufficiency objective due to a 41 percent surge in consumer sugar demand over the past decade. In the bioethanol sector, ethanol producers in Indonesia primarily depend on molasses, a byproduct of sugarcane processing. With a yield of 7.4 percent, the 2021–22 sugar production is expected to generate approximately 1.49 MMT of molasses. Annually, an average of 516,000 metric tons of molasses is exported, while about 52 percent of the molasses supply is utilized by ethanol distillers. Indonesia mainly produces industrial-grade ethanol for both domestic consumption and exports. Previous self-sufficiency drives fell short due to increased consumer demand, despite a 12% increase in local sugar production. Ethanol producers primarily depend on molasses, generating approximately 1.49 MMT annually. The bioethanol mandate program has been inactive since 2010, resulting in minimal demand for fuel-grade ethanol. The sugar self-sufficiency program targets increasing sugarcane yield, expanding cultivation, enhancing mill efficiency, and improving farmer welfare.

Industry sources indicate that achieving the break-even point, considering the entire cultivation process from planting to economic harvest scale, will require a minimum of 8 years. Farmers in Java persist in prioritizing the cultivation of food crops such as rice, corn, or soybeans, which offer three harvest cycles per year. Limited infrastructure presents challenges for expanding cultivation beyond Java. The southern part of Sumatera is identified as the sole feasible area for sugarcane plantation expansion. However, even in this region, sugarcane faces fierce competition from cassava. As a result, rather than expanding, Indonesian sugarcane plantations are witnessing a decline over time. Recently, Industry Minister Agus Gumiwang Kartasasmita has stated that the government is determined to accelerate efforts to achieve sugar self-sufficiency by 2028. The roadmap includes measures such as increasing sugarcane productivity to 93 tons per hectare by improving agricultural practices, adding 700 thousand hectares of sugarcane plantation area, as well as increasing the efficiency, utilization, and capacity of sugar factories to achieve a sugar yield of 11.2 percent. The industry will also focus on improving sugarcane farmers’ welfare and increasing the production of bioethanol from sugarcane to at least 1.2 million kiloliters by 2030 (https://sugar-asia.com/indonesian-govt-aims-to-achieve-sugar-self-sufficiency-by-2028).

Myanmar Sugar Industry

Myanmar, located in Southeast Asia, covers an area of approximately 676,577 square kilometers and has a tropical monsoon climate with three distinct seasons: summer, rainy, and cool. As of April 2024, the estimated population is 54.87 million, with over 70% residing in rural areas, and 65% of the labor force engaged in agriculture. Sugarcane cultivation is concentrated in the upper Saging Region, northern Shan State, and the Bago, Yangon, and Mandalay Regions. Planting typically occurs between December and January, with harvesting from November to February of the subsequent years. The rotation cycle for sugarcane cultivation spans four years. In 2023–24, sugarcane was planted across 175.88 thousand hectares, yielding 10,881,000 metric tons of cane and 90,000 tons of sugar (Table 1). In 2022, Myanmar’s sugarcane production reached 11.5 million tons, up from 2.03 million tons in 1973, with an average annual growth rate of 5.10% (Knoema 2023). Approximately 70% of farmers own land parcels of 1–2 hectares.

Myanmar operates 19 operational sugar mills (Fig. 2), collectively producing 30,000 tons of sugar per day, which falls short of meeting domestic demand. Per capita sugar consumption was recorded at 2.91 kg in 2021, and sugar production totalled around 330,000 tons in 2020 (Fig. 3). The annual sugar production is estimated at 450,000 tons, with exports directed solely to Vietnam due to declining domestic consumption. The growth rate decreased by 0.23% from 2022 to 2023 (Table 7).

Fig. 2

Sugar Mills with crushing capacity (TCD) in Myanmar under government and private sector

Fig. 3

Sugar production (thousand tons) in Myanmar (2011–2020)

Table 7 Sugar domestic consumption in Myanmar over the last ten years.

Since 1997, Myanmar’s sugar industry has modernized, shifting from import substitution to export orientation by increasing cultivated areas. However, cane yield has stagnated at around 60 metric tons per hectare over the past decade. The industry includes various stakeholders: government agencies, semi-government agencies, large-scale private companies, and small to medium sugar processing enterprises, with the private sector holding approximately 58% of the market share. Sugarcane prices are determined based on weight rather than sugar content. For the 2023–24 season, sugar mills like Shwenyaung Myabayin have increased the price to K150,000 per ton, while others range from K110,000 to K120,000 per ton, compared to last season’s K90,000–100,000 per ton. Sugarcane prices in Myanmar are higher compared to Thailand and India.

Private sector refineries procure high-quality cane at premium rates, with farmers delivering their cane directly to factory premises. All refineries can set their purchase prices, competing with neighboring factories. Government-determined sugar selling prices factor in the break-even point of production and consumer subsidies. State-owned factories are either leased or sold to private enterprises. Sugar imports are controlled by the Ministry of Commerce and Trade, as sugar is categorized as a sensitive commodity in the ASEAN region. Despite challenges such as fragmented cane fields, financial burdens, high production costs, and limited infrastructure, the Myanmar sugar industry benefits from mechanization, government support, favorable legislation, abundant resources, and optimal climatic conditions (Fig. 4).

Fig. 4

Strengths and challenges of the sugar industry in Myanmar

Expanding the industry requires structural adjustments and a robust sugar policy. Opportunities exist for increasing production, establishing market information services, and attracting foreign investment. Suitable areas for cultivation include upper Mandalay Division, upper Sagaing Division, Kayin State, Northern and Southern Shan State, as well as existing regions.

Recent investments, such as the joint venture company ‘Great Wall–Wilmar Holdings Limited’ by WSMPL and Great Wall, aim to boost sugar production in Myanmar. This venture will acquire all existing sugar-related businesses from Great Wall and its affiliates, including two sugar mills with a combined capacity of 4,000 metric tons of cane per day and a total production capacity of 65,000 metric tons of sugar per year, a bioethanol plant, and an organic compound fertilizer plant. These initiatives are expected to significantly enhance sugar production, indicating promising prospects for industry growth and development.

Vietnam Sugar Industry

Vietnam, a key player in the ASEAN region, ranks 19th globally in sugarcane yield, averaging 54 tons per hectare during the 2023–24 period, below the world average of 70 tons per hectare. In 2023–24, 134.88 thousand hectares were dedicated to sugarcane, with an anticipated yield of approximately 68.23 tons per hectare for 2024 (Table 1). For this season, 25 sugar factories are expected to be operational, with a collective capacity of 122,200 tons of sugarcane per day (Fig. 5) (Anonymous 2023a). Vietnam’s average Commercial Cane Sugar (CCS) content is around 10%, lower than other major producers. Total sugar production reached 876,428 tons in 2023, with an expected increase to 920,249 tons in 2024, while domestic consumption was 1,890,000 tons in 2023.

Fig. 5

Sugar mills in Vietnam

Vietnam’s sugar industry faces challenges such as the impacts of the El Niño phenomenon, rising agricultural material prices, smuggled sugar, and trade fraud. Sugar exporters aim to capitalize on higher export prices and trade measures, potentially revitalizing sugarcane cultivation and mill operations. However, intense competition from illicitly traded sugar and substantial inventory undermines competitiveness in both domestic and international markets.

The sector primarily serves domestic needs, but declining quantity and quality of sugarcane are attributed to climate change, especially in the Central Highlands and southern regions. Despite these challenges, increased cultivation area, crushed output, and sugar production during the 2022–23 season indicate a potential recovery. In the 2021–22 cycle, raw sugarcane prices surged by 100,000–150,000 VND per ton, prompting farmers to reinvest, boosting yields. The total cultivation area for 2022–23 was 141.906 hectares, marking an increase of 17.151 hectares compared to the previous season, with an average yield of 69.3 tons per hectare.

Vietnam’s sugar industry faces significant issues such as declining sugar prices, shrinking cultivation areas, and competition from low-cost smuggled sugar. In the 2022–23 season, the sector achieved the dual objective of raising purchase prices to regional levels while maintaining competitive sugar prices (Anonymous 2023a). However, smuggled sugar remains a major problem. The Vietnam Sugar Association reported that smuggled sugar volumes reached 501 thousand tons in 2021 and escalated to 816.544 tons in 2022 (Fig. 6).

Fig. 6

Source Cao Anh Duong 2023

Cane area and production statistics in Vietnam over the period of time.

Sustainable production aims to leverage primary and waste streams for product development, reducing input requirements and enhancing the value chain. Biogas extraction from wastewater lowers energy consumption, while biomass fertilizer production supports a circular economy (Nguyen et al. 2022). The industry must implement measures to strengthen sugarcane production links amidst competition from other crops (Anonymous 2023a). Besides, diverse sugar import tariff quota on different countries has also been allocated in the country (Table 8).

Table 8 Sugar import tariff quota allocation for 2023 in Vietnam

Favorable conditions for sugarcane growth suggest an average yield exceeding 85 tons per hectare. Despite these prospects, the industry grapples with challenges such as small land parcels, high input costs, suboptimal productivity, and competition from other crops. Mechanization remains low, at 10–20% compared to 80–90% in Brazil and Australia. The average sugar price in Vietnam is higher than in neighboring countries (Xuan et al. 2014) complicating competition (Table 9).

Table 9 Average price of sugar in Vietnam and other competing countries

The Vietnamese sugar industry has targeted expanding cultivation to 250,000 hectares by 2025 and 300,000 hectares by 2028. To achieve these goals, the Vietnam Sugar Association has urged the Ministry of Agriculture and Rural Development to prioritize research funding for sugarcane varieties and projects in key regions.

Vietnam’s favorable conditions, such as expansive flat terrain and adequate rainfall, bode well for sugarcane cultivation. The government supports the industry due to its role in rural development. Initiatives like land consolidation aim to create larger, more efficient farms, emphasizing advanced techniques to enhance productivity and stabilize regions. Domestic sugar consumption is expected to rise, driven by a young population and high growth rate.

The industry faces significant challenges (Fig. 7), including the influx of smuggled sugar from Thailand, accounting for about 19% of the total supply. This illicit sugar is priced lower due to tax evasion and reduced production costs. Reducing smuggling activity will help balance supply and demand, improving domestic sugar prices and profit margins. Vietnam is poised for future growth in sugarcane and sugar production (Fig. 7), targeting four key areas by 2030: producing 2.7 million tons of sugar, generating 2.4 million MWh of electricity from bagasse, producing 150 million liters of ethanol per year, and 500,000 tons of filter cake fertilizer. These goals align with meeting domestic demand and leveraging natural resources effectively.

Fig. 7

Challenges and prospects of the Vietnam sugar industry

Sugar Industry in Cambodia

Cambodia, an ASEAN member, plays a significant role in sugarcane production. In 2023, the country harvested a total of 2,734,000 metric tons (Table 1) of sugarcane, covering an area of 48.37 thousand hectares, which is anticipated to slightly decrease to 43.79 thousand hectares by 2024. However, despite this projected decrease, sugarcane cultivation has shown substantial growth over the years, expanding from 13,297 hectares in 2008 to 16,490 hectares in 2021(Table 10). Additionally, there has been a notable increase in sugarcane yield from 29,615 kg per hectare in 2008 to 41,480 kg per hectare in 2021. Despite these advancements, total sugarcane production has steadily risen from 385,238 tons in 2008 to 682,700 tons in 2021 (Table 10). Sugarcane cultivation is mainly concentrated in provinces like Kampong Speu, Koh Kong, Oddar Meanchey, and Preah Vihear (Narayan 2024; Sar 2020; Joshua 2021; Inclusive Development International 2021). The sugarcane season typically spans from November to April, with labor shortages during the harvesting period in April presenting a significant challenge for the sector.

Table 10 Sugarcane cultivation, production and productivity over the years in Cambodia.

Retail prices for sugarcane typically range from US$ 0.70 to US$ 1.20 per kilogram, showcasing a market sensitive to both local and global economic trends. Lower wholesale prices indicate Cambodia’s potential as a competitive player in the global sugarcane market, especially with strategic exports to countries like Vietnam, the Netherlands, and the Czech Republic (Narayan 2024). In 2009, UK sugar giant Tate and Lyle entered into 5-year contracts with KSL to procure all its output from Cambodia. Subsequently, in 2010, the Koh Kong refinery exported its first 10,000 ton shipment of sugar to the UK. Despite this, Cambodia managed to export 38,000 metric tons of sugar to the EU in 2014, its primary market, generating revenue worth $17.4 million. This export is facilitated under an EU trade deal aimed at alleviating poverty in developing nations. Despite these achievements, concerns have arisen over the displacement of approximately 12,000 Cambodian small farmers and their families due to this initiative, leaving them in dire straits. Cambodia benefits from sugar exports to the European Union (EU) under the Everything But Arms (EBA) trade scheme, which allows duty-free and quota-free access for Cambodian goods, including sugar. Approximately 80,000 hectares of land have been allocated for sugar production, although reports have linked existing concessions to human rights violations (Anonymous 2012).

Significant expansion initiatives are underway in Cambodia to boost sugar production. Recently, a Chinese-owned agricultural company inaugurated a $360 million sugar mill in northern Cambodia, marking the establishment of one of Asia’s largest sugar processing facilities. Rui Feng (Cambodia) International Co., Ltd, affiliated with Chinese enterprises holding economic land concessions (ELCs) in Preah Vihear Province, is leading the construction of this new sugar mill. The facility has a capacity of 20,000 TCD (tons of cane per day) and can produce 2000 tons of refined sugar annually (Anonymous 2012). Additionally, there is potential for the development of sugarcane-based biofuel, although this has yet to be fully realized (FAO 2021). Furthermore, Cambodian sugar industries are increasingly focusing on sustainable development goals (SDGs). They emphasize the critical importance of infrastructural development and sustainable water management practices to ensure that the expansion of the sugar industry does not compromise the environment or jeopardize vital water resources for local communities.

Thailand Sugar Industry

Thailand holds a prominent position in global sugarcane cultivation, significantly contributing to its economy through sugar and ethanol production. Thailand is the second-largest sugar exporter and third-largest producer globally, with an annual export volume of about 10 million metric tons (Kunsiripunyo 2023; Shahbandeh 2023). Sugarcane cultivation spans around 1.72 million hectares, mainly concentrated in the Northern, Central, Eastern, and Northeastern regions, where 57 sugar factories are located. The factories’ milling capacities range from 3,000 to 50,000 tons of cane crushed per day, collectively processing approximately 1 million tons daily. The harvesting season typically spans from November to March, with peak activity in January and February when mills operate at maximum capacity (Kunsiripunyo 2023).

Approximately 75% of sugarcane production is in the central and northeastern regions, known for superior yields and dense factory clusters. Over the past 23 years, sugarcane production and productivity have fluctuated (Table 11). The Thai Office of Cane and Sugar Board (OCSB) aims to expand cane cultivation and increase sugar production under its strategic plan from 2015 to 2026. This plan intends to increase cultivation from 1.7 to 2.6 million hectares, elevate cane production from 106 to 180 million tons, and boost sugar production from 11.1 to 20.4 million tons.

Table 11 Sugarcane production and productivity in Thailand over the years.

In the marketing year 2022–23, sugar production reached 11 million metric tons, a 9% increase from the previous year, attributed to higher sugarcane production and extraction rates (Anonymous 2023b). The increase in sugar production outpaced sugarcane production growth due to a higher extraction rate of 117.8 kg of sugar per ton of sugarcane in 2022–23, compared to 110 kg in 2021–22. Ninety-seven percent of the total sugarcane output was allocated to sugar production, a slight decrease from 98% in the previous year (Anonymous, 2023b). However, projections for 2023–24 estimate a decline to 8.1–9.4 million metric tons, primarily due to adverse weather conditions. Drought during the crucial growth phase severely impacted sugarcane yields for the 2023–24 period, prompting a downward revision in sugar production forecasts by 15% compared to 2022–23 levels. Precipitation levels between January 1 and September 10, 2023, were substantially lower, with a 32% decrease compared to the same period in 2022, significantly affecting sugarcane growth stages (Anonymous 2023a). Despite current challenges, prospects for the upcoming season appear promising, with favorable returns motivating farmers to expand cultivation, potentially surpassing 80 million tons of cane in 2024–25 (Watak 2024).

Thailand’s sugarcane production sector exhibits modest productivity, characterized by small-scale farming operations and predominantly rainfed cultivation. Only 22% of the total agricultural land and 10% of sugarcane fields benefit from irrigation. The industry faces stiff competition from alternative crops like rice, cassava, corn, rubber, and oil palm. Numerous challenges confront the sector, including labor shortages, escalating minimum wage rates, logistical hurdles, and soaring fuel costs (Fig. 8). Thailand grapples with challenges akin to those encountered by other agricultural and developing nations, including an aging population, rapid population growth, climate change, low agricultural productivity, labor shortages, and drought. Climate conditions and rainfall distribution significantly curtail productivity, leading to modest cane yields and low sugar content, despite the considerable crushing capacity of sugar mills relative to available cane. Moreover, escalating production costs, labor scarcity, the mechanization of cane farming, and the imperative for enhanced irrigation underscore the need for significant attention.

Fig. 8

Thailand sugar industry challenges and Government initiatives for better sugarcane cultivation

Molasses production saw a decline to 3.4 million metric tons in the marketing year 2022–23, marking a 6% decrease from the previous year. This decrease in production, attributed to minimal rainfall during the sugarcane maturity and ripening stages, is expected to constrain the molasses supply for ethanol manufacturing in 2023. Molasses prices also decreased from 2021–24 (Table 12). Additionally, the establishment of a new sugar-juice-based ethanol facility in 2022 initiated the production of industrial-grade ethanol for biochemical purposes (Anonymous, 2023b). The strategic plan from 2015 to 2026 aims to address the rising sugar consumption in Southeast Asia, the utilization of ethanol for biofuel in Thailand, and align with the government’s policies such as the new S-curve or bioeconomy policy and Thailand 4.0 initiative.

Table 12 Yield and Wholesale Prices of Sugar and Molasses (2021–2024) in Thailand

Sugar consumption in the country has increased to 3.1 million metric tons in the 2022–23 crop season and is projected to reach 3.2 million tons for 2023–24, reflecting an annual increase of around 3%. This growth is expected to align with the anticipated economic recovery, particularly in the hotel and food service sector (USDA Foreign Agricultural Service 2023). According to the Office of Cane and Sugar Board, sugar consumption surged by 7% during the initial seven months of the marketing season 2022–2023, primarily driven by heightened household sugar demand, which escalated by 13%. Conversely, industrial sugar demand experienced a slight decline of 1%, mainly due to reduced sugar requirements in the food processing sector. Specifically, sugar demand from food processors, constituting approximately 30% of domestic sugar demand for industrial purposes, contracted by 7% in the first half of 2023, paralleling a decline of around 5% in processed food exports compared to the same period last year (Anonymous 2023b). Current sugar yield and wholesale prices of sugar and molasses in Thailand are given in Table 12.

Thailand stands out as the sole net sugar exporter within the ASEAN region, with approximately 90% of its sugar exports directed toward Asia. Its strategic positioning in Southeast Asia, coupled with the increasing demand stemming from sugar deficits across Asia and Southeast Asia, presents considerable potential for Thailand’s sugar industry. Key destinations for Thai sugar include Indonesia, Japan, Cambodia, and China, with export volumes steadily rising and expected to surpass the 9 million metric ton mark within the next two years. Thailand exported around 11 million metric tons of sugar in 2022–23, marking a significant upsurge from the preceding year (Shahbandeh 2023). However, sugar export projections for 2023–24 are predicted at 10 million metric tons, attributing this adjustment to the anticipated sluggish economic recovery among trading partners in 2023 and 2024. Additionally, foreign buyers exercised caution in their new purchases for the latter half of 2023, owing to the prevailing upward pressure on global sugar prices, which soared to 26–27 cents/lb, representing an increase of approximately 43% from the average world sugar prices observed in 2022.

Sugar exports in the initial nine months of the marketing year 2022–23 amounted to 6.4 million metric tons, reflecting a marginal increase of approximately 1% compared to the corresponding period in the previous year. This uptick was primarily driven by heightened exports of refined sugar, which totaled 2.6 million metric tons, marking a notable 15% surge from the same period in the marketing year 2021–22. Sugar mills capitalized on selling more premium sugar varieties to yield higher returns. Refined sugar exports constituted 40% of the total sugar exports, up from 35% in the preceding year. Conversely, exports of raw sugar and white sugar, accounting for 52% and 8% of total sugar exports, respectively, experienced declines of 7% and 5% compared to the same period last year (Anonymous 2023b). Thailand successfully utilized its allocated U.S. quota of 22,455 metric tons of raw sugar (raw value) during the Fiscal Year 2023. This allocation comprised the original quota under the U.S. tariff-quota (TRQ) of 15,061 metric tons, a reallocation of 4,129 metric tons, and an increased allocation of 3,265 metric tons. Export prices under the U.S. TRQ exceeded world market prices (Anonymous, 2023b). The estimated export value of Thai sugar in 2023 is expected to range between 3260 and 3385 million EUR, representing a 1–5% increase compared to 2022. This growth is projected to soar by 125%, attributed to the low base during 2020–2021 due to the impact of the COVID-19 pandemic. Consequently, sugar production and stock levels in Thailand are deemed adequate to meet the demand in the export market. Thailand primarily exports three main sugar products: raw sugar, white sugar, and refined sugar. In terms of export destination value, Asia accounts for 95.68%, with neighboring countries such as Indonesia, Vietnam, Cambodia, and South Korea being key customers. As per the data from the Office of the Cane and Sugar Board, Thai sugar products constitute approximately 37% or 2 million tons of exports to Indonesia, with the lowest price set at 239.75 EUR per ton, reflecting Indonesia’s substantial orders. Conversely, Europe and North America represent the smallest export destinations, comprising only 0.46% of the total export volume. Despite this, prices in these regions are the highest compared to other destinations, averaging around 450 EUR per ton. Furthermore, Oceania and Africa collectively account for approximately 3.3% of export value (Kunsiripunyo 2023).

The Thai government offers financial packages to sugarcane farmers, allocating 5.9 billion baht ($170 million) during 2020–21 and 8.2 billion baht ($233 million) during 2021–22 to incentivize them to reduce the burning of sugarcane during harvesting, a practice that significantly contributes to air pollution. These incentives target approximately 200,000 sugarcane farmers and 56 sugar mills across 47 provinces in Thailand. As a result, in the 2022–23 crop season, the proportion of burned sugarcane decreased to 33% of the total sugarcane harvest, a significant reduction from the 70% observed in the previous year. Furthermore, the government estimated sugarcane selling prices at 1,120 baht ($31.8) per metric ton, a notable increase from the 1,070 baht ($30.4) per metric ton in 2021–22, driven by heightened demand for ethanol in 2022–23 (Anonymous 2023b).

Thailand’s sugar policy, intricately linked to its industrial policies, sees substantial government intervention. This encompasses managing cultivation areas, establishing domestic prices, providing direct payments to farmers, and facilitating loans and subsidies to ensure sustainable production and mitigate price volatility. With the industry’s privatization, government control has been limited, mainly focusing on setting market prices. Farmers may face reduced prices and increased market volatility as domestic prices align with international rates. The government continues to support industry diversification toward ethanol production, co-generation, and value-added products, translating into annual support of at least $1.3 billion (Anonymous 2015a, 2015b, 2016).

The 10-year cane and sugar strategy (2015–2026) includes establishing new sugar mills and expanding existing ones, potentially increasing production capacity to 1.1 million metric tons of sugarcane per day. The Thai government promotes the industry’s development through public–private partnerships, focusing on modern farming practices, mechanization, irrigation improvement, and R&D for new value-added products. The promotion of efficient sugarcane farming systems can significantly enhance sugarcane yield and sugar recovery while minimizing production costs and energy use. Integrating sugar and ethanol production can lead to increased profits for both industries. Improving yield and sugar recovery efficiency can boost the industry’s competitiveness. Effective government regulation and adequate enforcement are crucial for the sugar industry’s stability and growth, given its economic and social importance.

The Thai sugar industry must leverage ASEAN integration by enhancing efficiency, increasing production with fewer resources, and optimizing resource utilization. Positioned as the second-largest sugar exporter globally and the largest in Asia, Thailand is poised to benefit from exporting sugar to other ASEAN nations amidst regional free trade encouragement.

Sugar Industry of Malaysia

Malaysia, a notable sugarcane producer in ASEAN, typically produces between 1.3 and 1.6 million tons annually. Sugarcane, with about 7% sugar content, is harvested from January to April. The northwest region, especially Perlis and Kedah, is the primary area for sugarcane cultivation, benefiting from a conducive dry season. However, efforts to grow sugarcane in Perak and Negri Sembilan failed due to higher costs and less favorable conditions. Expansion potential exists in Johor and Sarawak.

In the 1960s, sugarcane cultivation in Malaysia covered less than 2,000 hectares, yielding 43,600 metric tons annually. Over three decades, production surged before declining in the 2000s. The peak occurred in 1995 with approximately 1.6 million MT. However, production plummeted after 2000, dropping to about 30,000 MT by 2017.

In 2023, Malaysia’s refined sugar production increased to about 1.98 million metric tons, up from 1.73 million metric tons in 2022 (Statistica, 2024b, Fig. 9). The decline in the 2000s may be due to adverse weather and conversion of plantations to crops like oil palm and rubber. Current sugarcane cultivation is mainly in Johor, Sarawak (3,863 MT), and Selangor (3,857 MT). Retail sugar in Malaysia is priced at RM2.85 per kilogram, one of the lowest in ASEAN, contrasting with higher prices in Thailand, Singapore, the Philippines, and Indonesia. Since 2013, retail sugar prices have increased marginally (Kamaruddin 2024).

Fig. 9

Sugar production in Malaysia over the past ten years

Malaysia has shifted from being a net importer to a net exporter of refined sugar. The deficit of raw sugar has outpaced the surplus of refined sugar, indicating rising domestic demand for food-grade sugar. In 2023, Malaysia imported 1,382,569 tons of sugar, with an expected increase to 1,893,139 tons in 2024. Exports were 113,412 tons in 2023, projected to rise to 194,091 tons in 2024 (Table 1). In 2022, Malaysia’s raw sugar exports were valued at $148 million, ranking 26th globally. Major export destinations included Vietnam, Singapore, the Philippines, Fiji, and Chinese Taipei, with the Philippines, Singapore, and Fiji showing the fastest growth between 2021 and 2022. Malaysia was the 8th largest raw sugar importer in 2022, with Brazil, India, Thailand, South Africa, and China as primary suppliers.

Malaysia’s dependence on sugar imports from Brazil and global supply limitations due to export suspensions by major producers like Thailand and India pose vulnerabilities for the local sugar industry (Kamaruddin 2024). Malaysia has long-term contracts with Australia and Fiji, covering 40–60% of annual import needs (FAO 2021). Additionally, an excise tax on sweetened beverages was implemented in 2019, targeting those with over 5 gm of sugar per 100 ml. Raw sugar imports are duty-free, with refined sugar imports also duty-free within a 100,000 ton yearly limit to support domestic refiners. Per capita sugar consumption is increasing due to rising incomes and a shift toward a modern diet with more processed foods and beverages (Koh 2021).

Domestic sugarcane was crucial to Malaysia’s sugar refining sector, coinciding with the emergence of refinery companies owning sugarcane plantations. Major companies include MSM Malaysia Holding Berhad and Central Sugars Refinery. Subsidiaries MSM Prai Berhad and MSM Perlis Sendirian Berhad were established in 1959 and 1971, respectively. Central Sugars Refinery, founded in 1965, resulted from mergers of various refineries. Other notable refineries include Gula Padang Terap and MSM Sugar Refinery Johor, with an annual capacity of 3.0 million metric tons, exceeding domestic demand of 1.5 million metric tons.

Malaysia’s per capita sugar supply has fluctuated, peaking at 53.4 kg in 1997, declining to 30.3 kg in 2005, and rising to 43 kg in 2013, a 43% increase since 1961. Among Asian nations, Malaysia ranks second in per capita sugar supply, trailing only Jordan (Tan and Tumin 2019).

Malaysian sugar manufacturers face challenges due to increased production expenses and government price controls. Global sugar price surges, shortages, and rising oil and transportation costs have led to significant losses for producers (Chini Mandi 2024). The sector is grappling with escalating operational costs, supply deficits, and price escalations, compounded by rising crude oil prices affecting refining processes reliant on natural gas (Kamaruddin 2024). Additional challenges include transportation costs and currency fluctuations, particularly the depreciation of the ringgit against the US dollar (Fig. 10).

Fig. 10

Challenges in sugarcane industry sector in Malaysia

In response, the Malaysian government has implemented measures to support sugar producers. Monthly incentives of RM1,000 per ton are provided for coarse granulated and fine sugar packaging to mitigate financial losses. These incentives are expected to continue until a revised pricing mechanism is introduced in 2024 (Kamaruddin 2024). Additionally, the government has capped the wholesale price of refined sugar at RM2.69 per kilogram, with retail prices for coarse (Gula Pasir Kasar) and fine sugar (Gula Pasir Halus) set at RM2.85 and RM2.95 per kilogram, respectively, to stabilize the market and provide relief to producers facing economic challenges.

Lao PDR Sugar Industry

Sugarcane is grown across all provinces in the nation except Bokeo. In 2022, the cultivated area for sugarcane reached 30,435 hectares (Table 13). While the sugarcane harvested area has seen fluctuations in recent years, it generally trended upward from 1973 to 2022. While individual farmers own most of the land, private sugar companies also manage a significant portion. The country is home to two main sugar factories: Mitr Lao Sugar Factory, operating mainly in Savannakhet Province, and Hoang Anh Gai Lai (HAGL) Sugar Factory, focusing on Attapeu Province. Sugarcane production has steadily risen over the years, reaching 1.5 million tons in 2022, marking a substantial increase since 1973. Sugarcane exports experienced a notable 32% increase in 2022 (Allen and Keuangkhamsing 2022).

Table 13 Sugarcane production, productivity in Lao PDR over the years.

Despite sugarcane cultivation existing in most provinces, the area devoted to it is minimal in many areas, with four states accounting for 88% of the total sugarcane plantation area. Savannakhet and Attapeu provinces are the primary sugarcane producers, contributing 70% of the country’s total sugarcane area, with higher productivity. Although Savannakhet Province leads in production, it does not top the list in terms of productivity. Phongsaly province boasts the highest sugarcane productivity, followed by Savannakhet. The country’s average sugarcane productivity stands at 49.3 tons per hectare, comparatively low compared to neighboring countries and the global average. Mitr Lao Sugar Co., Ltd., a Thai-owned company and the largest miller in Laos, produces around 44,000 tons of sugar annually (2009–2010), with about 95% of this production being exported, primarily to sugar refineries in England under the EBA tariff privilege. Sugarcane production in Laos has steadily increased from 818,800 tons in 2010 to 1,840,465 tons in 2014. There is significant potential to boost sugarcane production and productivity while also exploring diversification into ethanol and electricity production.

Conclusion and Way forward

The ASEAN sugar industry faces several challenges, including low cane productivity, high production costs, small land holdings, competition from more lucrative crops, and inadequate R&D support. Climate fluctuations further exacerbate these issues, affecting sugarcane production. Nations like Vietnam also struggle with illegal sugar imports, which drive down prices. Proactive measures, such as research, development initiatives, and government policies, are being undertaken to address these challenges. Key areas of focus include enhancing elite varieties, sharing germplasm, adopting tailored agronomic practices, diagnosing pests and diseases, employing sugarcane genomics and biotechnology, utilizing micropropagation for rapid elite variety multiplication, and conducting outreach programs to increase yield per hectare and reduce production costs.

The ongoing Asian Economic Integration anticipates significant trade integration and tariff reductions within the region, leading to increased sugar flow, reduced prices, and favorable import–export dynamics. The rising demand for sugar necessitates increased cane production and productivity. The establishment of the ASEAN Sugar Alliance (ASA) signifies cooperation among ASEAN sugar industries to share technological advancements and research. Countries like Thailand, the Philippines, Indonesia, Cambodia, Myanmar, and Vietnam have committed to this initiative since 2016. China has also been encouraging collaboration with ASEAN nations in the sugar industry since 2020.

While agriculture may not be the primary focus for Brunei Darussalam and Singapore, it remains vital for other ASEAN countries. As incomes rise, there will be a shift toward a more diverse and quality-focused demand for agricultural products, presenting significant development prospects. Efforts to mitigate ecosystem degradation, reduce reliance on chemical inputs, and enhance efficiency at farm and mill levels are crucial for ensuring the industry’s long-term viability and competitiveness. By fostering partnerships, embracing technological advancements, and prioritizing sustainability, ASEAN nations can maximize their sugar industry’s potential, contributing significantly to regional economic development and food security.