Bangkok, Oct 29 - Thailand, the world's second biggest sugar exporter, is expected to start 2009/10 sugarcane crushing on Nov. 20, slightly earlier than usual, millers and industry officials said on Thursday.
"The monsoon rains have subsided so there is no rain disrupting harvesting, which means we can start crushing quite early," said an official at the Agriculture Ministry.
The crushing season usually starts in early December. It is expected to run through to the end of April 2010.
Cane production in 2009/10 is likely to be only 71 million tonnes, giving around 7.1 million tonnes of sugar, according to the latest crop survey conducted jointly by millers, cane growers and traders.
The forecast was slightly lower than the most recent forecast of 76.4 million tonnes of cane, or around 7.6 million tonnes of sugar, from the Office of Cane and Sugar Board (OCSB), which oversees the country's sugar sector.
CROP SWITCHING
Sugar output in 2008/09 was 7.14 million tonnes.
Thai farmers have failed to grow more cane to capitalise on record high sugar prices because planting for the 2009/10 crop began in late 2008 and world prices only started rising in mid-2009.
New York futures hit a multi-year high of 24.85 cents per pound in early September on speculative buying in anticipation of strong demand from India, where a weak monsoon hit production.
The March raw sugar contract closed at 21.93 cents per lb on Wednesday.
Traders said they expected lower 2009/10 sugar output than the OCSB because farmers had switched to other commodities.
"During the survey, we found that farmers in the north and northeast regions had shifted to growing rubber," said a trader from a leading miller that participated in the survey.
Rubber trees need 5-7 years to mature and start producing latex, after which they can be tapped for almost 25 years, so switching from sugarcane to rubber cannot be easily reversed.
Thailand is the world's biggest rubber producer. Responding to surging prices in 2004, the Thai authorities launched a campaign to get farmers to grow more rubber on an additional 160,000 hectares in the north and northeast of the country.
After a recent rally in prices, there are even plans to expand rubber output to another 160,000 hectares from 2010.
The benchmark export-grade rubber sheet (RSS3) was quoted at $2.40 per kg on Thursday, rubber traders said.
But farmers are still expected to grow more cane in the next 2010/11 crop in a bid to profit from the surge in sugar prices.
The OCSB has forecast that Thailand would produce a record 80 million tonnes of cane, or around 8 million tonnes of sugar.
"Farmers are unlikely to shift back from rubber to sugar cane. However, we expect those who grow tapioca or corn to switch to sugarcane in the 2010/11 crop," one trader said.
Thailand usually sets aside 2 million tonnes of sugar for domestic consumption and the rest is for export.