Mills will be asking the Ministry of Commerce to extend tariffs originally set in 2017 that would support domestic sugar pricing, per Reuters.
A year ago, the Chinese government levied tariffs on all out-of-quota (OOQ) sugar, which meant that developing nations were no longer exempt from the tariff on all OOQ sugar, as had previously been the case. The OOQ tariff was set at 95 percent on May 2017, cut to 90 percent on May 2018, and cut to 85 percent on May 2019. After May 2020, the tariff would presumably fall back to 50 percent.
The current tariff-rate quota (TRQ) totals 1.945 MMT of sugar with a tariff of 15 percent; per FAS, 70 percent of the quota volume is assigned to state-owned companies.
The China Sugar Association may also petition for antidumping and anti-subsidy investigations, though no more details are available at this time.
Historically, high tariffs have been seen to encourage smuggling of sugar, much presumably via China’s lengthy borders. Authorities have claimed to have successfully clamped down on this smuggling in recent years.
China sugar production, imports, consumption