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Global Sugar Production Rises to 183.5 Million Tons: USDA Report Highlights

22 Nov 2023 10:16 pm
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Mumbai, 22 Nov (Commoditiescontrol):The U.S. Department of Agriculture's Foreign Agricultural Service (FAS) released a comprehensive report on Tuesday, November 21, 2023, revealing significant shifts in global sugar production, consumption, and trade dynamics. According to the report, the world’s sugar production is projected to increase by 8.2 million tons to reach 183.5 million tons. This surge is primarily attributed to substantial production hikes in Brazil and India, which are expected to compensate for the declines observed in Thailand and Pakistan.

Brazil, a key player in the sugar market, is expected to see its production soar by 3.0 million tons to an impressive 41.0 million tons, approaching near-record levels. Favorable weather conditions and an expansion in cultivated areas are credited for this increase. Farmers, encouraged by lucrative sugar prices, are increasingly dedicating their lands to sugarcane rather than grains. Additionally, the sugar/ethanol production mix in Brazil is tilting more towards sugar, moving from 48% to 49%, with ethanol production correspondingly decreasing.

In India, sugar production is anticipated to rise by 4.0 million tons, reaching 36.0 million tons. This increase is driven by expanded sugarcane areas and improved yields. While domestic consumption is on the rise, fueled by bulk buyers and processed food manufacturers, exports are forecasted to decline, likely due to government-imposed export caps aimed at controlling food inflation and satisfying domestic demand. Despite these dynamics, India’s sugar stocks are expected to remain stable.

Meanwhile, the United States is estimated to maintain its sugar production at 8.4 million tons. However, imports are predicted to decrease by 10% to 2.8 million tons, influenced by minimum quota programs aligned with international trade obligations. Domestic consumption is expected to witness a slight uptick, whereas stocks are projected to diminish slightly due to reduced imports and modest consumption growth.

China’s sugar sector is also experiencing changes, with production forecasted to increase by 1.0 million tons to 10.0 million, courtesy of favorable weather conditions. Despite stable consumption levels, China is expected to boost imports to balance supply and demand. However, stocks are projected to halve, impacted by lower beginning stocks and reliance on existing reserves to support consumption.

In stark contrast, Thailand’s sugar production is estimated to fall by 1.7 million tons to 9.4 million, largely due to drought conditions. Conversely, consumption is expected to rise, buoyed by economic recovery and increased tourism. Despite the production drop, exports are anticipated to exceed production, leading to a sharp decline in stocks.

Pakistan's sugar industry is facing a reduction of 600,000 tons in production, settling at 6.3 million tons. This decrease is attributed to a reduction in sugarcane harvested area, as farmers opt for alternative crops. With domestic consumption rising and production falling, Pakistan is likely to increase its sugar imports to 500,000 tons while curtailing exports to meet local demand.

Other notable mentions in the report include Mexico, Turkey, South Africa, and the Philippines, each experiencing unique changes in their sugar production and trade dynamics. Mexico’s production is up slightly, while Turkey and South Africa are witnessing modest increases. The Philippines, however, maintains steady production levels, with all sugar allocated for domestic consumption.

(By Commoditiescontrol Bureau; +91-9820130172)


       
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