Global Sugar Consumption Expands While Production Stagnates

Global sugar production for 2014/15 is forecast flat at 176 million metric tons (raw value) as a reduction in Brazil is mostly offset by growth in India. With abundant supplies continuing to weigh on the market, global consumption is forecast to rise as demand in India and China expand. Trade is down slightly as lower exports from Brazil and Mexico are only somewhat offset by Thailand.

2014/15 Sugar Overview

United States production is forecast unchanged from last year at 7.7 million tons. Consumption continues to rise, while imports of 2.8 million tons are forecast down 200,000 tons. Stocks are forecast at just under 1.0 million tons. Imports under the tariff rate quota assume minimum U.S. commitments to import raw and refined sugar. On May 9, 2014, the United States International Trade Commission determined that imports of sugar from Mexico have injured or threatened to injure U.S. sugar producers. As a result, the United States Department of Commerce will continue to investigate anti-dumping and countervailing duty margins, with a preliminary decision on subsidies expected in June, 2014, and a preliminary decision on dumping in September, 2014. These deadlines can be extended in special circumstances.

Brazil’s production is forecast to ease 1.0 million tons to 36.8 million as drought conditions lower yield. Consumption is expected to increase slightly reflecting population growth and expansion in the food processing sector. Exports are forecast down 1.0 million tons to 25.3 million on lower exportable supply.

Thailand’s production is projected to decline 400,000 tons to 11.0 million as yield returns to normal, more than offsetting an increase in area. Consumption continues to trend higher, driven by rising household and industrial use. Exports are forecast to jump to a record 8.3 million tons based on growing Asian demand, particularly from Indonesia and Cambodia. Exports will likely benefit from the Association of Southeast Asian Nations Economic Community Agreement.

India’s production is expected to increase nearly 900,000 tons to 27.9 million due to increased yield as consumption is forecast to continue rising. Exports are forecast to fall to 1.5 million tons to meet domestic demand.

European Union’s production is forecast at 16.3 million tons up 200,000 on both increased sugar beet area and yield. As consumption continues to trend higher, imports are forecast to grow by 250,000 tons to 3.8 million tons. Exports remain at 1.5 million tons, limited by the sugar export ceiling in the World Trade Organization.

China’s production is projected at 13.7 million tons, down 600,000 on lower yield. Rising consumption, which outpaces production, and lower imports are expected to drawdown stocks.

Mexico’s production is forecast slightly higher at 6.9 million tons, while consumption remains virtually unchanged for a third consecutive year. Exports are forecast down nearly 400,000 tons to 2.2 million.

Russia’s production is expected to remain at 4.4 million tons as an increase in area is offset by reduced yield. Consumption and imports are forecast down slightly.

Revised 2013/14 from November forecast:

- Global production is up slightly (877,000 tons) to 175.7 million.

o India is revised up 1.6 million tons to 27.0 million on higher yield.

o Brazil is lowered 950,000 tons to 38.8 million as more sugar cane is used for ethanol.

- Global imports are lowered 2.1 million tons to 50.0 million.

o India is down 1.7 million tons as imports drop to 100,000 on increased available supplies to meet domestic demand.

o Iraq is lowered 700,000 tons to 300,000 on weaker demand.

o China is revised up 1.1 million tons to 3.9 million on growing demand