Report Highlights:

For 2013/2014, the Nicaraguan Sugar Commission (CNPA) anticipates a sugarcane harvest of 7.2 million MT, with a total sugar production of 758,776 MT, raw value, a 6 percent increase compared to the previous year. The increase in production is attributed to the increase of sugar cane planting. CNPA reports that sugarcane plantings increased 5 percent in 2013/2104, reaching over 71,556 hectares.

Executive Summary:

The sugar industry in Nicaragua has experienced a steady growth since 2011 as a result of the expansion of sugarcane plantations. Just in 2013/2014, sugarcane production reached 7.2 million MT, with a total sugar production of 758,776 MT raw value, a 6 percent increase compared to the previous year. Total sugarcane plantations reached over 71,556 hectares, a 5 percent increase compared to the previous year. 

Some of the factors that have contributed to growth of the sugar industry in Nicaragua are above average international sugar prices, diversification of the sugar industry into the production of energy (the two largest sugar mills of Nicaragua sell energy to the national grid), and good access to export markets. Nicaragua has sugar tariff rate quotas with the United States under the WTO and CAFTA-DR, the European Union and Taiwan. 

For FY 2014, Nicaragua plans to ship its full U.S. WTO and DR-CAFTA sugar quota allocation. The Nicaraguan sugar industry is also in a good position to supply any additional sugar quota reallocation from the U.S. 

Sugar Cane for Centrifugal 

Production: 

Sugarcane is produced along the Pacific coast of Nicaragua. The Nicaraguan sugarcane harvest runs from November through May. The main sugar mills are San Antonio, Monte Rosa, Benjamin Zeledon and Montelimar. 

Preliminary data from the Nicaraguan Sugar Commission (CNPA) for the 2013/2014 season anticipate a total sugarcane harvest of 7.2 million MT, with a total sugar production of 758,776 MT, a 6 percent increase compared to the previous year. The increase in sugar production is mainly attributed to the increase of area planted to sugarcane. CNPA described the 2013/2014 production cycle as normal; the rainy season was moderate and no serious problems were reported with pests and diseases. The growth of the sugar industry is expected to continue in the next several years. For 2014/2015, CNPA forecasts an increase of 4 percent in sugarcane production. 

Besides sugar, Nicaragua plans to export 10 million liters of ethanol to the U.S. in 2014. At present, there is only one sugar mill that has an ethanol distillery plant. This ethanol is produced from molasses. Nicaragua lacks a legal framework that would support the consumption of bio-fuels, inhibiting the commercialization of ethanol domestically. 

2013/2014 Sugar production by main sugar mills

Crop Area:

In 2013/2014 sugarcane planting totaled 71,556 hectares, a 5 percent increase compared to the previous year. Most of the increase is attributed to the expansion of sugarcane plantations on the southwestern side of the country. Sugarcane areas are expected to grow 4 percent in 2014/2015. Analysts expect that sugarcane area will not increase as much in the northwest part of the country due to the rapid growth of groundnut plantations. 

Yields: 

Sugar cane yields remained stable in 2013/2014, reaching over 100 MT/HA. For the 2014/2015 season, CNPA expects similar yields, assuming good weather conditions. 

Consumption: 

Nicaragua’s sugar consumption was 250, 000 MT in 2012/2013, and it is forecast to increase to 254,000 MT in 2013/2014. Per capita sugar consumption is estimated at 46.64 kg for 2012/2013. According to the Nicaraguan Central Sugar Association (NCSA), the entity responsible for trading sugar, the increase in sugar consumption is attributed to the increase in population and not to a change in food habits of the Nicaraguan people. 

Trade: 

Sugar exports continue to increase. According to the International Trade Center (ITC), In Calendar Year 2013, Nicaraguan sugar exports reached over 375,437 MT, a 9 percent increase compared to the previous year. Major export destinations in 2013 include Venezuela, United States, Romania, and Haiti.

Sugar Quotas 

Nicaragua has tariff rate quotas with the United States under the WTO (22,114 MT) and CAFTA-DR (25,520 MT), the European Union (22,262 MT) and Taiwan (20,942 MT of refined sugar and 10,308MT of raw sugar). Mexico also allocates an export quota to Nicaragua but only when there is a shortage of sugar in that country.

Policy: 

The Government of Nicaragua does not set sugar prices, nor does it provide subsidies or special credit programs. Moreover, Nicaragua lacks a legal framework that would support the consumption of bio-fuels, inhibiting the commercialization of ethanol domestically. 

Marketing: 

The private sector of Nicaragua buys and sells all sugar. Sugar for national consumption is fortified with vitamin A and packaged in bags of 0.4, 0.8, and 2 kg. 

NCSA reported the following wholesale and retail prices for refined and white plantation sugar in 2013