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Summary of Sugar and Sweeteners Outlook Report (May 2018)

Core Content

This report provides an outlook for the U.S. and Mexican sugar markets for the 2017/18 and 2018/19 fiscal years. It outlines production, use, import, and export trends, as well as ending stocks and stocks-to-use ratios, based on data from the U.S. Department of Agriculture (USDA) and other relevant sources.

Main Points

U.S. Sugar Market Outlook (2017/18 and 2018/19)

• Production Decline: U.S. sugar production for 2018/19 is projected to decrease by 3.0% compared to 2017/18, totaling 8.981 million STRV.
  • Beet sugar production is expected to fall by 3.7%.
  • Cane sugar production is expected to decline by 2.2%.
• Domestic Use Increase: Domestic sugar use is projected to rise by 1.4%, with 12.500 million STRV delivered for food and beverage use.
• Import Trends: U.S. sugar imports are forecasted to decrease by 1.7%, primarily due to fewer imports under quota programs.
  • Imports from Mexico are expected to increase nearly 30%, contributing to the overall import reduction.
• Ending Stocks and Stocks-to-Use Ratio:
  • Ending stocks for 2018/19 are projected at 1.542 million STRV, with a stocks-to-use ratio of 12.1%.
  • This indicates a tighter market than the 2017/18 estimate, which had a stocks-to-use ratio of 15.0%.

2017/18 U.S. Production and Deliveries

• Beet Sugar Production: 5.221 million STRV, an increase of 82,000 STRV from the April projection.
  • Higher production is attributed to improved planting progress and a slightly higher sucrose extraction rate.
• Cane Sugar Production: 4.031 million STRV, with Florida's production rising by 4.2% and Louisiana's decreasing by 10.6%.
• Deliveries:
  • Domestic deliveries for food and beverage use are expected to increase by 1.4%.
  • Total deliveries are projected at 12.655 million STRV, with a 1.5% annual growth rate.
• Ending Stocks: 1.901 million STRV for 2017/18, up 42,000 STRV from the previous month.

Mexico Sugar Market Outlook (2017/18 and 2018/19)

2017/18 Production and Deliveries

• Production: Estimated at 5.970 million MT, a reduction of 80,000 MT from the previous month.
• Imports: Increased to 190,000 MT, up 20,000 MT from the April projection.
• Deliveries:
  • Domestic deliveries are expected to total 4.377 million MT, a 159,000-MT reduction from the previous month.
  • Human consumption is projected at 4.562 million MT, while imports for IMMEX (sugar-containing product exports) are estimated at 50,000 MT.
• Ending Stocks: 1.243 million MT for 2017/18, with a stocks-to-human consumption ratio of 28.7% and a stocks-to-use ratio of 21.0%.

2018/19 Production and Deliveries

• Production: Projected to increase by 0.9% to 6.025 million MT.
  • Higher beginning stocks and improved planting progress in the U.S. are expected to contribute to this growth.
• Imports: Projected to decline to 84,000 MT, with a slight increase in imports for the IMMEX program.
• Exports:
  • Exports to the U.S. and Puerto Rico are projected to be 1.408 million MT.
  • Exports to other countries are expected to be 10,000 MT.
• Ending Stocks: Projected at 983,000 MT for 2018/19, with a stocks-to-use ratio of 15.4%.

Key Information

• Planting Progress: U.S. sugarbeet planting was delayed due to cold weather in April and early May, but progress accelerated in late May, leading to a strong yield forecast.
• Impact of Weather: In Louisiana, the sugarcane crop conditions have worsened, leading to a reduction in production compared to the previous year.
• Import Dynamics:
  • U.S. imports from Mexico are expected to rise due to increased U.S. needs and lower domestic production.
  • Imports under quota programs are projected to decrease, while non-program imports are expected to increase.
• Market Trends:
  • U.S. domestic deliveries are expected to grow due to increasing population and refined sugar consumption.
  • Mexico's domestic market is expected to see a rebound in deliveries in the coming year due to falling wholesale prices.

Figures and Tables

• Table 1: Highlights U.S. sugar supply and use for the 2016/17 to 2018/19 periods.
• Table 2: Details beet sugar production and related factors for 2017/18.
• Table 3: Provides a comprehensive overview of Mexico's sugar supply and use for the 2016/17 to 2018/19 periods.
• Figures 5–11: Show trends in production, deliveries, and inventories for both the U.S. and Mexico.
• Figures 12–16: Illustrate the production and consumption trends in Mexico, including the impact of trade agreements and market conditions.

Conclusion

The U.S. sugar market is expected to face tighter conditions in 2018/19 due to lower production and higher use, while Mexico's market is projected to see a slight increase in production and ending stocks. The report underscores the importance of weather, trade agreements, and domestic consumption trends in shaping the outlook for both countries.