Insight Focus
- US sugar prices for 2024 continue to creep higher.
- Louisiana’s cane crop ratings are the worst in a decade.
- 80% of the state’s cane is under “exceptional drought”.
Concerns about tightening raw sugar supplies pushed some spot and forward refined sugar prices higher in the week ended Sept. 22. The drought in Louisiana remained a major concern for sugar cane, while the sugar beet harvest advanced slowly.
Spot beet sugar prices for 2022-23 were offered at 62¢ to 64¢ a lb f.o.b. Midwest, firm to 2¢ higher. Refined cane sugar continued to be offered through calendar 2023 by one refiner at 68¢ a lb f.o.b. nationwide, unchanged.
Prices rose for both cane and beet sugar supplies for calendar 2024. Cane sugar was offered by one refiner at 62¢ a lb f.o.b. Northeast and West Coast, up 1¢ from its prior list price, which had been steady for weeks. Prices ranged from 57¢ to 60¢ a lb f.o.b. Gulf and Southeast, also 1¢ higher. Beet sugar was offered at 56¢ to 59¢ a lb f.o.b. Midwest, firm to 1¢ higher.
The US Department of Agriculture’s state office rated the Louisiana sugar cane crop as of Sept. 17 at 21% good, down from 1% excellent and 26% good a week earlier, with 42% fair, 24% poor and 13% very poor. Louisiana’s ratings have dropped weekly since July 23 and were the lowest for any week in more than a decade. Louisiana subsoil moisture was 87% short to very short as of Sept. 17.
The USDA in its assessment of the Sept. 19 US Drought Monitor showed worsening drought conditions in Louisiana with 80% of sugar cane in areas of exceptional drought (the most severe rating) and 20% in extreme drought, compared with 24% exceptional, 65% extreme and 11% severe a week earlier. The much smaller Texas crop was 100% in severe drought, while no sugar cane in Florida was in drought.
Some cane farmers in the driest areas were assessing whether or not to harvest their crop or abandon it for insurance.
At least two of the state’s cane mills were expected to start processing this week with the remaining mills beginning operations the first week of October.
Beet processing plants that had recently begun slicing early harvested beets were continuing to run smoothly thanks in part to favorable weather throughout major growing areas. Sugar beets in the four largest producing states were 10% harvested as of Sept. 17, even with the five-year average, with Minnesota and North Dakota slightly ahead and Idaho and Michigan behind, the USDA said. The sugar beet harvest should be underway in all states by the first week of October, with growers hoping favorable weather will allow more sugar to be deposited in beet roots as the harvest progresses. Rainfall during harvest is detrimental as it tends to dilute the sugar content in beet roots.
Corn sweetener negotiations for annual 2024 contracting were underway with initial offers flat to slightly higher from 2023 contracted levels. Contracting was expected to move slower this fall as buyers, hoping for flat to lower prices, were in no rush to buy after last year’s sharply higher prices.
