American geographer Jack F. Williams, in an academic paper titled Sugar: The Sweetener in Taiwan’s Development, described sugar as one of the two cornerstones of the rural economy before 1950; the other was rice. Sugarcane farming had a massive impact on land use and economic development in Taiwan. The refining of sugar was the island's earliest large-scale energy-intensive industry, and it has left behind several landmark buildings, and also fragments of a narrow-gauge railway network established specifically for the transportation of raw sugar cane.
Sugarcane was growing in Taiwan before the Dutch arrived in 1624, and because the VOC recognized its potential as a cash crop, they encouraged Han migrants to plant even more. The Kingdom of Dongning ramped up sugar production and boosted exports to Japan. However, for much of the Qing period the industry stagnated due to a shortage of capital. After 1895, however, production multiplied as Japanese entrepreneurs, backed by the colonial government, built modern refineries and expanded the area devoted to growing sugar to about one-fifth of all the land under cultivation. By 1920, sugar accounted for 65% of Taiwan’s exports. In 1950, the figure was 80%. Since then it has dwindled to almost nothing because other countries - notably Brazil, India and Thailand - are able to produce sugar more cheaply.
Sugar has left a noticeable physical imprint on the landscape. Most of the large fields in the south used to be sugar plantations, and a number of former sugar refineries have been converted into cultural venues.