Sweeteners China News 1511 (12 issues per year)

Date: 2015-12

“2015 sees M&A in China’s sweetener industry. In sucrose, starch sugar and HIS segments, there are enterprises involved in this:

– By acquiring other enterprises to expand production scale: Nanning Sugar and Guangxi Guitang acquired sugar plants fromYongkai Sugar and Paper
– By extending into the downstream supply chain to enrich product range: Guilin Layn planned to develop end products such as health-care products and cosmetics; ZCHT intended to develop stevia sweetener compounds

Those enterprises that ever failed in the industry competition, now come to breakdown, or renew themselves. For example, Yongkai Sugar and Paper vowed solemnly in January 2015 that it would integrated its sugar assets and go listed within 1 year; however, its 2 large sugar plants, Daqiao Sugar Plant and Zuojiang Sugar Plants were (or to be) acquired, only the small Litang Sugar Plant left. In 2015/16 extracting season, it announced not to start business. In this view, it is possible that the company will completely withdraw from the market.

Suzhou Hope also fell down during the AK market competition. In February this year, the company noted the reorganisation plan. In November, it basically finished the plan. However, it still takes time for the company to make an entire recovery. In addition, the definitive measures were taken by the EU on the Chinese AK producers – Suzhou Hope specifically shall pay anti-dumping duty of USD4.74/kg (EUR4.47/kg). This will exert pressure on the company.

According to researcher CCM, many sweetener companies have plans to carry out M&A. We will continue following this issue in this newsletter.”


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