Importing Sugar from Brazil to Bangladesh: A Step-by-Step Guide

 

Md. Joynal Abdin
Founder & Chief Executive Officer, Trade & Investment Bangladesh (T&IB)

Editor, T&IB Business Directory; Executive Director, Online Training Academy (OTA)
Secretary General, Brazil Bangladesh Chamber of Commerce & Industry (BBCCI)

 

Brazil is one of the world’s largest and most consistent sugar exporters, with established export logistics, multiple shipping options (bulk and containerized), and widely traded grades such as VHP raw sugar and refined white sugar (often referenced by ICUMSA color grades like 45, 150). Brazilian export flows commonly move through major ports like Santos and Paranaguá, which are set up for high-volume agricultural commodities. For Bangladeshi importers, Brazil is attractive when (a) global prices are competitive, (b) you need steady volume, and (c) you want standard grades that refiners and consumer-packers can handle reliably.

 

2) Understand what you are importing: raw vs refined sugar (and how it changes your plan)

Your whole import plan supplier choice, inspection, packaging, vessel type, port handling, and even buyer segment depends on the grade.

 

A. Raw sugar (common for local refineries)

• Usually traded as VHP (Very High Polarization) raw sugar.
• Typically moved in bulk shipments (large volumes) to reduce freight per ton.
• Final product quality depends heavily on local refining capability and loss factors.

 

B. Refined white sugar (common for direct consumption/packaging)

• Often referenced as ICUMSA 45 (very white), or higher numbers like ICUMSA 150 depending on market segment.
• Can be shipped bagged (e.g., 50 kg) in containers or sometimes break-bulk/bagged cargo, depending on volume and port handling.

 

Importer tip: If you are not a refinery, refined sugar is operationally simpler (no refining risk), but you must control packaging integrity, labeling, and quality compliance more strictly at destination.

 

3) Regulatory compliance in Bangladesh: what cannot be ignored

Sugar is a food product. That means your shipment must be compliant with relevant Bangladesh requirements, including conformity/standards controls.

 

A key point for importers: Bangladesh Trade Portal indicates that sugar may be imported after obtaining a conformity standards certificate from BSTI.

In practice, importers usually plan for destination-side quality verification (and sometimes pre-shipment inspection too), because any non-compliance can trigger delay, storage cost, demurrage, and rejection risk.

 

Also, Bangladesh maintains a structured duty/tax framework for sugar under HS Chapter 17 (notably HS 1701). In the NBR Customs Tariff FY 2025–2026, HS codes under sugar show duty/tax components (e.g., entries for 170112, 170113, 170114, 170191, 170199) with stated CD/VAT/RD/AT/AIT columns.

Important: Duty structures can change via SROs or policy moves; for example, Bangladesh news sources reported regulatory-duty adjustments impacting import-level duty burden in late 2024.

So, before you open the LC, confirm the current applicable duty/tax treatment with your C&F agent using the exact HS code and product description.

 

4) Commercial planning before you buy: the decisions that protect your margin

Before requesting offers from Brazil, fix these items internally:

 

1. Target market and buyer

• Refinery supply (raw sugar) vs packer/wholesaler/retail supply (refined).
• Define acceptable quality ranges (color, moisture, polarization, insoluble matter, contamination limits).

 

1. Shipment size and freight strategy

• Bulk: best cost per ton for large lots (commonly refinery buyers).
• Containers: flexible for smaller lots, easier handling, but freight/ton may be higher.

 

1. Pricing model

• Decide whether to buy on a floating benchmark basis or fixed price.
• Include: commodity price + premium/discount for grade + freight + insurance + bank/LC cost + port charges + duties/taxes + inland logistics + wastage.

 

1. Timing and seasonality
   Brazil’s logistics are strong, but global sugar markets can be volatile. Build buffer for vessel schedule changes, port congestion, and documentary delays.

 

5) Step-by-step process: how to import sugar from Brazil to Bangladesh

Step 1: Set up your importer readiness (Bangladesh side)

Operationally, you should have:

• Import capability (trade license, bank relationship for LC/TT, and relevant registrations used for import operations).
• A nominated C&F agent to advise HS classification, port procedure, and the real landed-cost model for your shipment.

 

Step 2: Select product specification and HS code mapping

Work with your C&F agent to map the correct HS code under HS 1701 and align the spec with your contract wording (raw vs refined, added flavor/color or not, packaging type). The NBR tariff document lists sugar HS entries and associated duty/tax columns for FY 2025–2026.

 

Step 3: Shortlist Brazilian suppliers and request an export offer

Ask for a formal offer/proforma invoice covering:

• Product grade/spec (e.g., VHP or refined ICUMSA grade), crop/production info if available
• Quantity, tolerance, packaging (bulk / 50 kg bags), and marking
• Incoterms (FOB Santos/Paranaguá or CFR/CIF Chattogram/Mongla)
• Shipment window, partial shipment rules, and transshipment policy
• Payment terms (LC at sight/usance, SBLC, TT against documents—choose cautiously)
• Required documents list (see Step 8)

 

Brazilian exporters commonly ship through ports including Santos and Paranaguá.

 

Step 4: Do supplier due diligence and contract the risk controls

For food commodities, do not rely only on price. Add risk controls:

• Company legitimacy checks (registration, export track record)
• Contract clause for quality/weight determination method (where, by whom, and which lab/standard)
• Clear tolerance for moisture, color, polarization, contaminants
• Dispute resolution and penalty clause for out-of-spec cargo
• Demurrage responsibility and laytime terms for bulk vessels (if applicable)

 

Step 5: Decide inspection model (recommended)

Common models:

• Pre-shipment inspection (quality + weight + packaging condition) by a recognized surveyor
• Load-port supervision for bulk cargo
• Destination testing aligned with BSTI conformity needs

 

Because sugar import requires conformity/standards control, plan your inspection flow so you can support BSTI compliance steps without delays.

Step 6: Arrange financing and open the LC (typical for Bangladesh imports)

Most large commodity imports are done via Letter of Credit. Align LC terms with what your supplier can provide. Keep LC conditions “document-realistic” (banks reject documents for minor mismatch).

 

Key LC alignment points:

• Exact product wording (must match invoice/packing list/COO)
• Latest shipment date and document presentation period
• Required certificates (COO, quality, weight, fumigation if any, insurance if CIF, etc.)
• Partial shipment / transshipment terms

 

Step 7: Book shipping and confirm logistics chain

Your logistics plan should include:

• Load port in Brazil (often Santos/Paranaguá)
• Discharge port in Bangladesh (commonly Chattogram; choose based on your inland distribution plan)
• Container vs bulk vessel selection
• Storage plan (bonded warehouse vs direct delivery)
• Demurrage/detention budgeting

 

Step 8: Prepare the full document set (must match LC + customs needs)

Typical documents for sugar import include:

• Commercial Invoice
• Packing List
• Bill of Lading (B/L)
• Certificate of Origin (COO)
• Quality/Analysis Certificate (lab report; parameters as per contract)
• Weight Certificate (especially for bulk)
• Insurance Certificate (if CIF or if LC requires)
• Any required conformity/standards-related papers to support BSTI process

 

Step 9: Arrival, port handling, and customs clearance in Bangladesh

Your C&F agent will manage:

• Manifest/IGM processes
• HS classification finalization and duty/tax assessment
• Coordination for examination/sampling if required
• Port charges, storage, and release order procedures

 

The duty/tax structure for sugar is documented in the NBR Customs Tariff FY 2025–2026 under HS 1701 lines (showing duty/tax components by HS code).

Also, regulatory-duty policy changes have occurred in recent years, so always confirm the latest treatment before shipment/LC.

 

Step 10: BSTI conformity and quality release workflow

Because sugar is listed as requiring a conformity standards certificate (per Bangladesh Trade Portal), your operational plan must include:

• How sampling/testing will be handled
• Which lab/surveyor is acceptable for your buyer and regulators
• How you will store cargo while awaiting results (especially important for bulk shipments to avoid high demurrage)

 

Step 11: Inland transport, warehousing, and distribution

For refined sugar (bagged), focus on:

• Bag integrity, moisture protection, palletization, and pest control
  For raw sugar (bulk/refinery), focus on:
• Rapid discharge + controlled transport to refinery to reduce handling loss and contamination risk

 

6) Costing and pricing: build a realistic landed-cost model (so you don’t lose money)

A strong landed-cost model includes:

• FOB/CFR price
• Ocean freight + port surcharges
• Marine insurance
• Bank charges (LC opening, confirmation if any, margin, interest if usance)
• Port costs (handling, storage, scanning, survey)
• Duty/tax based on correct HS code per NBR tariff schedule
• Inland freight and warehouse
• Wastage/shrinkage allowance
• Working-capital cost until sales collection

 

If duty/tax policy shifts (as reported at times by Bangladesh sources), your model must have a buffer.

 

7) Risk management: the most common mistakes Bangladeshi importers make

1. Buying on price only without enforceable quality/inspection terms.
2. Weak LC wording leading to document discrepancy and delayed release.
3. Wrong HS code assumption causing sudden duty/tax shock at customs.
4. No plan for BSTI conformity steps, resulting in port storage and demurrage.
5. Improper moisture/packaging protection for refined sugar, causing caking, bag damage, and claims.

 

8) Practical checklist (summary you can follow for each shipment)

• Confirm product type (VHP raw vs refined ICUMSA grade) and packaging
• Confirm HS code and current duty/tax using NBR tariff + current policy notes
• Finalize supplier, inspection plan, and enforceable contract terms
• Open LC with realistic document requirements
• Book vessel/containers and lock shipment window
• Prepare complete document set and ensure perfect consistency
• Plan BSTI conformity workflow in advance
• Clear customs efficiently and execute inland distribution with quality protection

 

Closing note

Importing sugar from Brazil can be highly profitable for Bangladeshi importers when you treat it as a controlled system: correct product selection, correct HS classification, disciplined contract + inspection, LC/document accuracy, and a pre-planned BSTI conformity workflow. The importers who win consistently are the ones who manage quality risk + documentary risk + policy/duty risk not only commodity price.