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USDA Sugar and Sweeteners Outlook

19 May 2015

USDA Sugar and Sweeteners Outlook - May 2015USDA Sugar and Sweeteners Outlook - May 2015

USDA Sugar and Sweeteners Outlook

U.S. domestic sugar production expected to fall slightly in 2015/16; Mexican sugar market expected to be relatively tighter in 2015/16

The USDA’s May publication of the World Agricultural Supply and Demand Estimate (WASDE) provided its first projection for 2015/16. Domestic sugar production is expected to total 8.450 million short tons, raw value (STRV) for the year. This would be a 0.9- percent decrease from the revised 2014/15 production estimate of 8.527 million STRV. Imports for 2015/16 are projected at 3.810 million STRV, with 1.369 million STRV expected from quota programs—based on minimum commitments to the World Trade Organization and under Free Trade Agreements, since quota amounts have not yet been announced by the USDA—while 2.116 million STRV are expected from Mexico, up from the current estimate of 1.526 million STRV for 2014/15. Domestic deliveries for 2015/16 are projected at 12.120 million STRV, up 1.0 percent from 2014/15, based on a 1.1 percent increase of deliveries for food use to account for refined sugar’s higher proportion of total caloric sweetener consumption. Ending stocks for 2015/16 are projected to be 1.547 million STRV, further lowered from the downward revision of the 2014/15 projection of 1.607.

Mexican sugar production in 2014/15 was revised downward by 50,000 metric tons, actual weight (MT), to 6.000 million MT, based on additional information on the impacts of adverse weather in the Veracruz production region earlier in the season. Production in 2015/16 is also projected to be 6.000 million MT, although less area is expected to be harvested, with higher sugar per hectare yields offsetting the decline. Exports for 2015/16 are projected to total 1.821 million MT, with 1.811 million MT destined for the United States. The U.S. share is based on the calculation of U.S. Needs as defined by the suspension agreements for the anti-dumping and countervailing duties investigations against Mexican sugar signed in December 2014. Domestic deliveries of sugar in 2015/16 are estimated at 4.574 million MT, unchanged from the 2014/15 projection, with human consumption totaling 4.250 million MT for both 2014/15 and 2015/16. With a relatively tight supply situation anticipated for Mexico in 2015/16, expanded sweetener consumption is expected to be accounted for primarily by high-fructose corn syrup, which is expected to increase from an estimated 1.420 million MT in 2014/15 to 1.478 million MT in 2015/16. Ending stocks for 2015/16 are projected to be 668,000 MT, down from the revised 2014/15 estimate of 907,000. This would result in a 15.7 percent stocks-to-domestic-consumption ratio for 2015/16, which is relatively low by historical standards. For 2014/15, the revised stocks-to-consumption ratio estimate is 21.3 percent.

Published by USDA Economic Research Service

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