China’s sugar market faces dual pressures with imports jumping to 740,000 tonnes in July while extreme weather conditions threaten domestic production in the key beet-producing region of Inner Mongolia.

Record rainfall hits beet production

Inner Mongolia registered its heaviest continuous rainfall during July and August since 1956, with over 60% of annual precipitation falling in just one week. Industry experts expect losses of up to 30% in the region’s beet crop, reducing projected output from 1.5 million tonnes to 1.25 million tonnes for the upcoming campaign starting September 1st.

The flooding adds pressure to China’s domestic sugar supply, which already faces challenges from waterlogged cane areas across southern provinces following heavy summer rainfall.

Import activity accelerates ahead of festival season

July’s import surge brought the average CIF landed price to CNY3,186 per tonne (USD445/tonne) before duties and taxes, equivalent to approximately 18.00 cents per pound on a FOBS basis 96. This increase is typical ahead of the mid-Autumn Festival in October, when sugar consumption traditionally spikes.

From January to July, total imports reached 1.78 million tonnes, representing a 4% increase year-on-year. The Ministry of Foreign Trade began reallocating unused Additional Import License (AIL) quotas in mid-August, with many licenses acquired by national and international food processing companies.

Strong domestic sales performance

Despite import pressures, Guangxi province – China’s largest sugar producing region – reported robust sales performance. By July 31st, 85.1% of the current marketing year’s production had been sold, totaling 5.5 million tonnes and marking an increase of 396,600 tonnes compared to the same period last year.

Industrial inventory in Guangxi stood at 968,900 tonnes at the end of July, down 113,000 tonnes year-on-year, indicating healthy demand absorption.

Price dynamics favor coastal refineries

Market data shows a USD70 per tonne cost advantage for high-grade refined sugar produced by coastal refineries compared to domestic cane sugar from Guangxi. This differential, split between logistics costs and quality premiums, helps explain the continued demand for imported raw sugar among China’s eastern seaboard refineries.

Current prices for refined sugar range between CNY6,000-6,500 per tonne including 13% VAT across major consumption centers from Beijing to Nanjing.

The combination of weather-related production concerns and seasonal demand patterns suggests China’s import requirements may remain elevated through the remainder of 2025.

This news article is part of our full market analysis. To view the full analysis, go to: https://app.vespertool.com/market-analysis/2237