20220119-USDA-USDA_Sugar_and_Sweeteners_Outlook_2022.1.19_17页_1mb

Summary of the Sugar and Sweeteners Outlook: January 2022

Core Content

This report provides an outlook for U.S. and Mexican sugar supply and use for the 2021/22 fiscal year (October/September), highlighting the record-high U.S. sugar production, changes in import volumes, and the implications of export limits and trade agreements.

U.S. Sugar Outlook

Key Highlights

• Supply Increase: U.S. sugar supplies for 2021/22 increased by 94,689 STRV to 14.113 million STRV, driven by higher domestic production and beginning stocks, which offset lower imports.
• Production Growth:
  • Cane Sugar: Increased by 144,333 STRV to 3.992 million STRV, largely due to strong expectations for the Louisiana campaign.
  • Beet Sugar: Increased by 7,650 STRV to 5.400 million STRV, surpassing the previous record high of 5.279 million STRV in 2017/18.
• Total Production: If realized, total sugar production for 2021/22 would reach 9.393 million STRV, the highest on record.
• Import Reduction:
  • Total imports for 2021/22 decreased by 60,209 STRV to 3.016 million STRV.
  • The reduction is attributed to lower-than-expected volume under the WTO raw sugar TRQ and FTA TRQ, with the 2021 TRQs now closed.
• Ending Stocks:
  • Ending stocks for 2021/22 increased to 1.773 million STRV.
  • The stocks-to-use ratio rose to 14.4 percent, up 0.77 percentage points from the previous month.
• Export Limit:
  • The U.S. Department of Commerce maintained the November Export Limit of 908,730 STRV for Mexico, which is 150,000 STRV higher than the initial limit.
  • The Export Limit is set at 758,730 STRV, with no more than 30 percent of the sugar allowed to be refined with polarity at or above 99.2 degrees.
• Prices:
  • U.S. sugar prices remain elevated, with Midwest refined beet sugar at 39 cents per pound and Northeast refined cane sugar between 49-55 cents per pound.
  • The price differential between U.S. and world sugar futures is narrowing, potentially affecting high-tier imports in the coming months.

Mexico Sugar Outlook

Key Highlights

• Supply and Use Unchanged: Mexico's sugar supply and use for 2021/22 remain unchanged from the previous month's forecast.
• Total Supply and Use:
  • Total supply is 7.095 million MT.
  • Total use is 6.178 million MT.
• Ending Stocks and Ratio:
  • Ending stocks remain at 916,883 MT.
  • Stocks-to-use ratio is 14.8 percent.
• Production Status:
  • Domestic sugar production is forecast at 5.979 million MT, below CONADESUCA's projection of 6.116 million MT.
  • Harvest and milling campaign started slowly, with only 45 out of 49 sugar mills operational as of week 15.
  • Cumulative area harvested is 158,358 hectares, down 7,740 hectares from the previous year.
  • Sugarcane processed is 12,526,740 MT, down from 12,907,231 MT in the same period last year.
  • Sugarcane yield is up slightly, while sugar extraction rate is down by 0.03 percent.
• Sugar Production:
  • Total sugar production is 1,265,535 MT, down 3 percent from 2020/21.
  • The production of the additional sugar under the suspension agreement is expected to begin in early January after export permits were granted.

Key Information

U.S. Sugar Supply and Use

• Beginning Stocks: Increased to 1,705,000 STRV.
• Total Production: Forecast at 9,393,000 STRV.
• Imports: Reduced to 3,016,000 STRV.
• Total Supply: Projected at 14,113,000 STRV.
• Total Use: Unchanged at 12,340,000 STRV.
• Ending Stocks: Increased to 1,773,000 STRV.
• Stocks-to-Use Ratio: 14.4 percent.

Mexico Sugar Supply and Use

• Beginning Stocks: 1,053,000 MT.
• Production: 5,979,000 MT.
• Imports: 63,000 MT.
• Total Supply: 7,095,000 MT.
• Total Use: 6,178,000 MT.
• Ending Stocks: 916,883 MT.
• Stocks-to-Human Consumption Ratio: 23.4 percent.

Main Points

• U.S. Production: Record-high sugar production in both cane and beet sectors, with beet sugar surpassing previous records.
• U.S. Imports: Reduced due to lower-than-expected TRQ entries, with the WTO raw sugar TRQ imports entering at a faster pace than usual.
• Export Limit: Maintained at 908,730 STRV for Mexico, with no changes to other import categories.
• Use and Stocks: Sugar use remains unchanged, but ending stocks and stocks-to-use ratio have increased due to higher supply.
• Mexico Production: Slow start to the harvest and milling campaign, with production slightly below expectations and some mills not yet operational.
• Trade Dynamics: High-tier imports are still expected to play a role in meeting demand, especially if domestic production and supply variables remain unchanged.

Conclusion

The report indicates that U.S. sugar production has reached record levels, supported by strong domestic output and higher beginning stocks, while imports have decreased. Mexico's sugar supply and use remain stable, with a slow start to the production season and the Export Limit maintained at a higher level. Prices in the U.S. remain elevated, and the potential for high-tier imports and logistical challenges could impact the market in the coming months.