20180316-USDA-Sugar_and_Sweeteners_Outlook_17页_689kb

Sugar and Sweeteners Outlook Summary

Core Content

This document provides an outlook on sugar and sweeteners for the 2017/18 fiscal year, focusing on production, imports, exports, domestic deliveries, and ending stocks in the U.S. and Mexico. It also includes insights into market conditions, price trends, and the impact of the re-export program.

Main Points

U.S. Sugar Outlook

• Production: U.S. sugar production for 2017/18 is projected at 9.240 million STRV, up 10,000 STRV from the previous month.
  • Beet sugar remains unchanged at 5.219 million STRV.
  • Cane sugar increases by 10,000 STRV to 4.021 million STRV, primarily due to improved conditions in Texas.
• Imports: Total imports are raised by 151,000 STRV to 3.467 million STRV, driven by increased re-export program imports and a slight rise in Mexican imports.
• Exports: Exports are projected at 150,000 STRV, up 50,000 STRV from the previous month.
• Ending Stocks: Ending stocks are raised by 111,000 STRV to 1.953 million STRV, with a stocks-to-use ratio of 15.5%.
• Domestic Deliveries: Total domestic deliveries are 12.480 million STRV, with 12.325 million STRV for food and beverage use. Deliveries for domestic use remain stable, while cane sugar deliveries show a slight decrease through January but increased in January 2018.

Mexico Sugar Outlook

• Production: Mexico's sugar production for 2017/18 is projected at 6.050 million MT, a 50,000 MT decrease from the previous month due to slower harvested area growth.
• Imports: Total imports are raised by 35,000 MT to 170,000 MT, mainly for human consumption.
• Exports: Exports are projected at 1.347 million MT, down 15,000 MT from the previous month, due to lower supplies.
• Ending Stocks: Ending stocks are 989,000 MT, maintaining a stocks-to-consumption ratio of 22.0% and a stocks-to-use ratio of 15.9%.

Key Information

Production Conditions

• U.S.: Favorable weather conditions have supported record levels of sugar production, particularly for sugarbeets and sugarcane. Texas and Louisiana have seen notable increases in cane sugar production.
• Mexico: Sugarcane harvest continued without major interruptions, but lower harvested area reduces production outlook. Production of low-polarity sugar is on track to meet the Export Limit.

Import and Export Trends

• U.S. Imports: Increased due to re-export program and Mexico.
• U.S. Exports: Raised due to strong export pace, especially to Mexico.
• Mexico Imports: Increased to meet domestic consumption needs, while exports to the U.S. slightly increased.
• Re-export Program: Despite a regulatory change in 2016, U.S. refiners have found new channels to maintain import volumes. The program now projects 400,000 STRV of imports.

Price Trends

• Refined Sugar Prices: Remain above previous year levels, with beet sugar at 36.00 cents per pound and cane sugar at 37.00 cents per pound in February 2018.
• Price Spread: The spread between U.S. and Mexican sugar prices remains significant, with Mexican estandar sugar prices 7.35 cents higher than U.S. raw sugar prices in February 2018.

Market Dynamics

• Stocks-to-Use Ratio: The U.S. ratio is 15.5%, while Mexico's is 15.9%.
• HFCS Consumption: Increased in Mexico, likely due to high sugar prices and reduced supply, which has driven demand for high fructose corn syrup.

Summary Table

Additional Notes

• The re-export program is crucial for maintaining import volumes and refinery utilization.
• Weather and regulatory changes have impacted production and trade dynamics in both countries.
• Price differentials continue to influence trade flows and market behavior.