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U.S. + Mexico Sugar Market Report

June 2024 Edition

Date: 19/06/2024 – Sugar

Welcome to our monthly U.S. + Mexico Sugar Market Report, covering data updates from 01/05/24 to 10/06/24. This report provides an overview of the latest developments in U.S. and Mexico’s sugar production, yield projections, and import/export adjustments based on data from the USDA Economic Research Service (ERS) report published 18th of June, 2024.

Note – 1 short tons raw value (STRV) = 0.907185 metric tons

U.S. Production Overview

U.S. sugar production is reduced for both 2023/24 and 2024/25 due to lower beet sugar production and a decrease in Florida cane sugar output.

  • Beet Sugar: For 2023/24, beet sugar production is revised down by 50,000 STRV (short tons raw value) to 5.045 million STRV due to lower sucrose recovery and increased shrinkage.
  • Cane Sugar: Florida’s 2024/25 cane sugar production forecast is decreased by 32,000 STRV to 2.004 million STRV following a lower production outlook by cane processors.

Import Adjustments

  • High-Tier Tariff/Other Imports: For the period of 2023/24, the category is increased by 47,000 STRV to account for imports of cane molasses used in producing refined cane sugar.
  • Mexican Imports: Imports from Mexico for 2023/24 are trimmed by 31,000 STRV due to a diminished outlook for low polarity sugar, significantly down from previous projections.

Export Adjustments

  • 2023/24 Ending Stocks: Lowered by 34,000 STRV to 1.724 million STRV, with a stocks-to-use ratio of 13.6%.
  • 2024/25 Ending Stocks: Reduced by 19,000 STRV to 1.445 million STRV, resulting in a stocks-to-use ratio of 11.5%.

Mexico Production Overview

For 2023/24, Mexico’s sugar production has increased by 69,000 MT to 4.718 million MT, though still a 25-year low. The harvested area is expected to reach 740,000 hectares.

Export Adjustments

  • Exports to the U.S.: Reduced to 399,000 MT for 2023/24 due to a lower share of low polarity sugar in production, considerably down from the May projection.
  • Exports to Other Countries: Reduced to zero for 2023/24, with the excess production contributing to carryover stocks into 2024/25.

Summary

The updated USDA ERS forecast highlights a mixed outlook for the U.S. and Mexico sugar markets in 2024. Adverse weather conditions have led to reductions in production, and decreased imports from Mexico contribute to a tighter supply. Regular monitoring of these trends is essential for stakeholders.

References

  • USDA ERS Sugar and Sweeteners Outlook – Link (June 2024 Report)
  • Image Credit: Steven Penton (D940D2B87D4BB63AEE5B2A1DDC031166)

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