During this time, we see that the US trade policy towards other countries causes impacts throughout the world. There have been higher trade barriers; particularly the trade war between United States and China has become very tense by creating high trade tariffs in many products. Such situation has greatly affected to business performance of many multinational companies investing in both countries. At the same time, many countries are facing continuous economic problems and some countries are in critical situation such as high inflation in Turkey, Argentina and tremendous inflation in Venezuela etc. These situations warn us that the global political and economic changes may occur at any time.
Although such situation has not affected the global sugar industry, but over the past two years, due to good weather, global sugar productions was more than consumption about 15 million tons. Resulting in declination of the world sugar prices and affecting sugar exporting countries including Thailand which sugarcane production was 20-30% higher than years ago by its output of 134.45 million tons and sugar yield of 14.64 million tons. In addition, Thailand announced the abolition of domestic selling proportionate quantities according to quota A, so the domestic sugar sales competition became intensely, as a result, domestic sugar prices dropped and affected to sugar business performance of our Group.
Our Group has realized and foreseen this problem, so it has invested and increased revenues from downstream business for many years. Revenues from sales of electricity, pulp business, ethanol business fertilizer and soil conditioning products business are able to generate good return to our Group. We are studying to invest in bagasse pulp mold which has rising demand in the world market and also business expansion by studying for joint investment with Global Green Chemicals Public Company Limited or “GGC” for Bio Complex, which will create higher value added of sugar cane to bio-chemical industry. The investment requires a lot of capital. So it takes time to study the whole picture and related aspects including risk management so that to ensure a good return in the future.
I am confident that the KTIS Group will move and grow stably in the future and would like to express our gratitude to shareholders, directors, executives, employees and all related organizations for continuing support and help KTIS Group. With our long experience in business, we will lead the organization to grow sustainably.