Analysis Sugar
Sugar price decline continues unabated
On the ICE exchange in New York and London, prices continue to fall. Although last week's news from Brazil is not necessarily price-depressing. News close to home concerns the progress of sugar beet processing.
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Cosun reports that there are still some 2,8 million tons of beets to be processed, of which 2 million tons still have to be harvested. Or 30% of the area. The yield expectation remains the same, namely 12,4 tons of sugar per hectare.
Sugar prices fell yesterday to $464,51 per tonne in New York, and in London the price dropped to $547,70 per tonne. The current pressure on sugar prices contrasts with the news from Brazil's Unica. The main producing region produced 59,2% less sugar in the first half of November, to a total of 898.000 tonnes. This brings sugar production since the start of the season to 38,274 million tonnes. This is 3% lower than in the same period last year. Logically, sugar cane processing was also lower in the first half of November (-52,8%), which means that processing since the start of the season is 2,2% lower compared to the same period last year.
USDA expects more sugar production, but declining ending stocks
On the other hand, the US Department of Agriculture reported in the latest World Markets and Trade report on November 21 that global production is expected to increase to 186,619 million tons in market year 2024/25. This is a revision from the previous forecast of May (186,024 million tons of sugar). Global production in market year 2023/24 is estimated at 183,827 million tons.
Consumption expectations are also rising: the November forecast for 2024/25 is 179,631 million tonnes of sugar, higher compared to market year 2023/24 (177,567 million tonnes).
The figures on the world stocks are interesting. The May forecast showed a closing stock of 38,339 million tonnes, but this has increased significantly in the November forecast to 45,427 million tonnes. The closing stock of market year 2023/24 was 48,372 million tonnes. The expectation now is that the world closing stock of sugar will decrease in market year 2024/25.
ISO expects sugar shortage
The International Sugar Organization (ISO) previously expected, in the quarterly forecast of November, a world sugar shortage for 2024/25. This shortage was estimated at 2,513 million tons of sugar. This is lower than the previous forecast (in August 3,58 million tons). The ISO assumes a world production of 179,069 million tons and a consumption of 181,582 million tons.