Report on contract sugar cane planting in Kokang

May 13, 2011

云南糖网 (Yunnan Sugar Net) has published a feature article on contract sugar cane planting in Kokang, a now-defunct Special Region 1 of Burma’s Shan State. The article does not mention the occupation of the region byBurmese  government forces in 2009, and the figures it gives suggest that contract farming has not been affected.

Yunnan’s Zhenkang 镇康 County signed an agreement with Kokang on the joint development of 30,000 mu (2,000 ha) of farmland in 1996 under a Chinese government “opium substitution” subsidy scheme. 13 thousand mu was actuallyplanted, of which 9 thousand with sugar cane. In Kokang’s Minzu Township 民族乡, for example, most of a population of 14 thousand now derive their livelihoods from sugar cane. At current prices, one mu of sugar cane results in 1,900 yuan of net annual revenue. One household made 40,000 yuan last year and bought a car.

The Kokang representative of 镇康南华南伞糖业, a Zhenkang sugar mill, recalls that locals met the — presumably more or less forced — “sugarification” with suspicion. The company provided the cash, seedlings, technology, and management, and collected the crop; the Zhenkang County government “mediated”, and the Kokang government organised the distribution of seedlings and fertilizers. In 2010-11, Kokang sugar cane made up 60% of the cane used by the company’s mill. By March 2010, it had invested 17 million yuan in the scheme, including road construction.

In 2008, at the time of the commodity price boom, two other companies from Zhenkang signed agreements to plant 100 thousand mu of walnuts and rubber, respectively, in Kokang. The article does not mention if these plans are now going ahead. The Zhenkang government also designated an industrial park next to the Kokang border.