The sugar markets in the U.S. and Mexico are undergoing significant adjustments in production, imports, and stocks, influencing sugar supply dynamics for the 2023/24 and 2024/25 crop years. This analysis provides a detailed overview of the changes and their potential impacts on the market.
U.S. sugar supply for 2023/24 is decreased mainly due to lower domestic production, with an offsetting increase in specific import categories.
For 2024/25, U.S. sugar supply sees further reductions, with lower beginning stocks and production but slightly increased imports.
Mexico's sugar production for 2023/24 is adjusted upward, with increased exports to the U.S. and higher imports for domestic consumption, leading to substantial increases in ending stocks for 2024/25.
For the 2023/24 season, the U.S. sugar supply is revised downward by 34,257 short tons, raw value (STRV), totaling 14.377 million STRV. This reduction is primarily due to decreased beet sugar production, which is down 50,040 STRV owing to lower sugar recovery from desugared molasses and higher beet pile shrink. While imports from Mexico are reduced by 31,434 STRV due to lower production of below 99.2 polarity sugar, this decrease is more than compensated by an increase in high-tier tariff and other types of sugar imports. Notably, the "Other" category, representing the raw sugar equivalent of refiners molasses, is adjusted upward by 47,146 STRV for the remainder of 2023/24 and the full year of 2024/25, enhancing the direct consumption imports category.
The 2024/25 U.S. sugar supply forecast indicates a decrease of 18,959 STRV due to lower initial stocks and reduced production, even with an uptick in imports. Florida's cane sugar production is estimated at 2.004 million STRV, a drop of 31,848 STRV according to processors' predictions. Ending stocks for 2024/25 are expected to be 1.445 million STRV, resulting in a stocks-to-use ratio of 11.51 percent.
Mexico’s sugar production for the 2023/24 season is estimated at 4.718 million metric tons (MT), an increase of 69,067 MT over the previous month. This rise is driven by a late-season uptick in production due to increased harvested area, totaling approximately 740,000 hectares. The share of low polarity sugar continues to decline, now estimated at 6.00 percent. Exports to the U.S. are projected at 398,704 MT. Imports for consumption are revised up to 496,000 MT based on the latest estimates. For the 2024/25 season, ending stocks are significantly increased by 78,277 MT to 978,457 MT to cover use for 2.5 months before the start of the next sugar campaign.
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The information provided in this market insight is for general informational purposes and should not be considered financial advice. It is not intended to offer any financial recommendations or endorsements. Any decisions made based on the content are the sole responsibility of the reader.
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