The Sugarcane Value Chain in Latin America and Asia Main Actors, Market Mechanisms, Labour Issues and Opportunities Diana Quiroz, Barbara Kuepper, Gerard Rijk, Eline Achterberg 5 May 2021 Colophon This research report is commissioned and published by CNV Internationaal. About Profundo With profound research and advice, Profundo aims to make a practical contribution to a sustainable world and social justice. Quality comes first, aiming at the needs of our clients. Thematically we focus on commodity chains, the financial sector and corporate social responsibility. More information on Profundo can be found at www.profundo.nl. Authorship This report was researched and written by Diana Quiroz, Barbara Kuepper, Gerard Rijk and Eline Achterberg, with contributions of Ward Warmerdam and Mara Werkman. Correct citation of this document: Quiroz, D., Kuepper, B., Rijk, G., and E. Achterberg (2021, May), The Sugarcane Value Chain in Latin America and Asia, Amsterdam, The Netherlands: Profundo. 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Contents Summary ................................................................................................................................... 1 Abbreviations ............................................................................................................................. 3 Introduction ............................................................................................................................... 4 Methodology ........................................................................................................ 6 1.1 Objective ........................................................................................................................... 6 1.2 Sugar sector mapping ...................................................................................................... 6 1.2.1 Global developments and dynamics in the sugar sector .............................................. 6 1.2.2 Country sector profiles ..................................................................................................... 7 1.2.3 Relationships with Dutch financial institutions .............................................................. 7 1.2.4 Price-setting, sales and profits ........................................................................................ 7 1.2.5 Environmental and social responsibility issues ............................................................. 8 The global sugarcane market ................................................................................ 9 2.1 Global sugar crop production and the role of sugarcane .............................................. 9 2.2 Key products derived from sugarcane .......................................................................... 10 2.3 Global sugar market developments and drivers .......................................................... 11 2.3.1 Market volatility .............................................................................................................. 11 2.3.2 Global sugar consumption ............................................................................................. 13 2.3.3 The impact of the COVID-19 pandemic ........................................................................ 13 2.3.4 Sugar consumption outlook .......................................................................................... 13 2.4 Main social and environmental sustainability issues in sugarcane production ........ 14 2.5 Voluntary certification schemes for sugarcane production ........................................ 16 2.6 Main traders of sugarcane products ............................................................................. 17 2.7 Main buyers of cane sugar ............................................................................................ 18 The sugarcane sector in selected countries ........................................................ 19 3.1 Role of focus countries in sugar production ................................................................ 19 3.2 Direct Dutch imports of sugarcane products from focus countries ........................... 20 3.3 Bolivia .............................................................................................................................. 20 3.3.1 Production of sugarcane and derived products ........................................................... 20 3.3.2 Key industry actors ......................................................................................................... 21 3.3.3 Trade relationships ......................................................................................................... 22 3.3.4 Impact of COVID-19 ........................................................................................................ 23 3.3.5 Living wages ................................................................................................................... 23 3.4 Colombia ......................................................................................................................... 24 3.4.1 Production of sugarcane and derived products ........................................................... 24 3.4.2 Key industry actors ......................................................................................................... 25 3.4.3 Trade relationships ......................................................................................................... 26 3.4.4 Impacts of COVID-19 ...................................................................................................... 26 3.4.5 Living wages ................................................................................................................... 27 3.5 Guatemala ....................................................................................................................... 27 3.5.1 Production of sugarcane and derived products ........................................................... 27 3.5.2 Key industry actors ......................................................................................................... 29 3.5.3 Trade relationships ......................................................................................................... 30 3.5.4 Impact of COVID-19 ........................................................................................................ 30 3.5.5 Living wages ................................................................................................................... 31 3.6 Nicaragua ........................................................................................................................ 31 3.6.1 Production of sugarcane and derived products ........................................................... 31 3.6.2 Key industry actors ......................................................................................................... 32 3.6.3 Trade relationships ......................................................................................................... 33 3.6.4 Impact of COVID-19 ........................................................................................................ 33 3.6.5 Living wages ................................................................................................................... 33 3.7 Peru ................................................................................................................................. 33 3.7.1 Production of sugarcane and derived products ........................................................... 33 3.7.2 Key industry actors ......................................................................................................... 34 3.7.3 Trade relationships ......................................................................................................... 35 3.7.4 Impact of COVID-19 ........................................................................................................ 36 3.7.5 Living wages ................................................................................................................... 36 3.8 Cambodia ........................................................................................................................ 37 3.8.1 Sugarcane production and derived products ............................................................... 37 3.8.2 Key industry actors ......................................................................................................... 37 3.8.3 Trade relationships ......................................................................................................... 39 3.8.4 Impact of COVID-19 ........................................................................................................ 40 3.8.5 Living wages ................................................................................................................... 40 3.9 Indonesia ........................................................................................................................