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USDA Sugar and Sweeteners Outlook


19 June 2013

USDA Sugar and Sweeteners Outlook - June 2013USDA Sugar and Sweeteners Outlook - June 2013


USDA Sugar and Sweeteners Outlook

On May 23, 2013, the U.S. Department of Agriculture (USDA) released the World Production, Supply and Distribution (PSD) for centrifugal sugar. Included in the May 2013 sugar PSD were new supply and use estimates for the 2012/13 marketing year, first projections of supply and use for 2013/14, and some revisions to older data. The USDA estimates 2012/13 world sugar in surplus at 10.110 million metric tons raw value (MTRV) and projects a smaller 2013/14 surplus of 6.707 million MTRV. World stocks-to-use are estimated at 23.4 percent in 2012/13 and projected at 22.7 percent in 2013/14. World stocks-to-use have averaged 23.8 percent since 1989/90 but only 20.0 percent in the 4 years prior to 2012/13. World exports are projected in 2013/14 to increase substantially by 2.255 million (MTRV) to 59.191 million MTRV. Exports from Brazil are expected to grow 1.650 million MTRV to 29.300 million MTRV.

Each year the Sugar and Sweetener Outlook of the Economic Research Service (ERS) makes calendar year estimates of total sweetener deliveries that are available for food and beverage consumption by U.S. consumers. U.S. deliveries of total sweeteners for human food and beverage use for 2012 are estimated at 20.350 million tons, slightly higher than 2011 deliveries of 20.320 million tons. Neither refined sugar deliveries nor high fructose corn syrup (HFCS) deliveries changed that much from the previous year. On a per capita basis, U.S. sweetener deliveries for 2012 were 129.5 pounds, down 0.7 pounds from 2011 and down 19.7 pounds from the 149.2 pounds in 2000. After adjusting for food losses prior to consumption, per capita sugar consumption (intake) for 2012 is estimated at 41.3 pounds, the same as last year. HFCS per capita consumption is estimated at 27.1 pounds, down 0.3 pounds from 2011 and down 9.7 pounds, or 26.4 percent, since 2000.

On June 12, 2013, the USDA released its latest estimate/projection of 2012/13 and 2013/14 sugar supply and use for the United States and Mexico in the World Agricultural Supply and Demand Estimates. 2012/13 Mexico sugar production is estimated at 6.840 million mt, a large 625,000 mt increase from May, based on an increased harvested area estimate and better than expected yields. 2012/13 exports are increased by 100,000 mt to 1.718 million mt. All of the increase is expected to go the U.S. market. The remainder of the supply increase augments ending stocks and is expected to lead to strong exports to the United States in first quarter (October – December) of 2013/14. Overall 2013/14 sugar exports are forecast at 1.937 million mt, with all but 110,000 mt going to the U.S. market. 2013/14 ending stocks are projected at 1.172 million mt. The implied stocks-to-consumption ratio is 27.5 percent, far above the 22.0 percent level traditionally considered to be optimal.

All changes to the U.S. sugar supply and use balance are through changes in imports. In 2012/13, imports from Mexico are estimated at 117,000 short tons, raw value (STRV) higher than last month. Low returns to exporting to the U.S. market are expected to decrease tariff-rate quota (TRQ) imports by 54,000 STRV. 2012/13 ending stocks increase by 63,000 STRV to 2.231 million STRV, implying a stocks-to-use ratio of 19.0 percent. The primary effect of the 2012/13 increase in Mexico’s sugar exportable surplus is to increase U.S. imports in early 2013/14. Imports from all sources are forecast at 3.810 million STRV and ending stocks are forecast at 2.680 million STRV. The implied 2013/14 stocks-to-useratio is a high 22.4 percent.

World Sugar

On May 23, 2013, the U.S. Department of Agriculture (USDA) released the World Production, Supply, and Distribution (PSD) for centrifugal sugar. Included in the May 2013 sugar PSD were new supply and use estimates for the 2012/13 marketing year, first projections of supply and use for 2013/14, and some revisions to older data. The USDA bases most of its estimates and projections on information contained in various Sugar Annuals published through the Global Agricultural Information Network (GAIN) of USDA’s Foreign Agricultural Service (FAS).1 These reports for major sugar-producing and consuming countries were reviewed in last month’s Sugar and Sweetener Outlook, and summaries are provided below.

Table 1 shows supply sources (beginning stocks, production, and imports) and use (exports, domestic consumption, and ending stocks) for major countries and aggregate regions. World exports are projected in 2013/14 to increase substantially by 2.255 million metric tons raw value (MTRV) to 59.191 million MTRV. Exports from Brazil are expected to grow 1.650 million MTRV to 29.300 million MTRV. Brazil sugarcane production is expected to rise by 8.3 percent, but a smaller proportion of the crop—48 percent compared with 50 percent in 2012/13—is forecast to be used for producing sugar instead of ethanol due to lower returns from exporting sugar. Nonetheless, sugar production is projected 4.7 percent higher than last year, up to 40.4 million MTRV, due to the larger sugarcane crop.

Sugar production in India for 2013/14 is projected at 25.3 million MTRV. Although production is down 7.7 percent relative to 2012/13, it is still much higher than the low point of the last sugar cycle, when production was only 15.95 million MTRV in 2008/09. India is forecast to import 1.5 million MTRV in 2013/14, while exporting as much as 600,000 MTRV. Ending stocks are projected at 9.75 million MTRV, equal to 4.5 months of consumption.

Sugar production in Thailand is expected to recover from 2012/13 drought conditions by 600,000 MTRV to a total of 10.5 million MTRV. Exports are projected at 8.5 million MTRV, up 500,000 MTRV from 2012/13. Exports only 5 years ago were less than 5 million MTRV.

Other major sugar exporters are expected to contribute to overall export supply expansion in 2013/14. Production in both Australia and South Africa continue recovering from the extreme weather conditions experienced in 2010/11 and 2011/12—excessive rainfall and cyclone damage in Australia and extreme dryness in South Africa. Australian exports are expected to rise 300,000 MTRV from last year to 3.4 million MTRV. South African exports are expected to rise to 500,000 MTRV, up from last year’s 400,000 MTRV and up from only 272,000 MTRV in 2011/12.

Guatemala is expected to export 1.655 million MTRV, up 15,000 MTRV, and Colombia is expected to export 880,000 MTRV, up 60,000 MTRV. Colombian sugar production has finally recovered from the excessively wet conditions of 2009-11 but still faces increased competition from ethanol production from the underlying sugarcane crop.

Russia is expected to increase sugar imports by 330,000 MTRV to 1.03 million MTRV. This increase partially offsets a small expected decline in production but should also allow consumption to expand by 200,000 MTRV to 5.715 million MTRV. Russian sugar imports are only 45 percent of their value in the period 2008/09 through 2010/11. China is forecast to import 2.6 million MTRV in 2013/14, enough to allow consumption to increase 1.204 million MTRV to 16.604 million MTRV while keeping ending stocks at about the same level as in 2012/13.

The European Union (EU) is forecast to import 3.8 million MTRV in 2013/14, about the same as estimated for 2012/13. Most imports come from traditional developing-country suppliers covered under European Partnership Agreements and under the Everything-But-Arms agreement.

June 2013

Published by USDA Economic Research Service

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