• Hurricane Laura made landfall in Louisiana last night; this is the region’s strongest hurricane in the last 10 years.
  • It will hit some of Louisiana’s cane-growing regions, which account for 20% of US sugar production.
  • The cane and general harvesting infrastructure could be damaged by flooding and high winds.

Where Did Hurricane Make Landfall?

  • The hurricane made landfall on the western coast of Louisiana and the Gulf of Mexico.
  • This is an area with a large number of cane fields.
  • We think it will continue moving north in the coming days.
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  • The above area is suffering storm surges and some forecasts warn that water levels could rise up to 20 feet.
  • The initially labelled Category 4 hurricane has now been re-categorised as Category 2, but it remains hugely powerful and destructive as winds continue to reach 110mph.

How Will the Cane be Affected?

  • Cane is a very resilient crop and ‘weak’ storms can actually be beneficial for the cane due to the excess water they bring.
  • However, if the cane is submerged for more than two weeks, this will impact yields.
  • If the winds cause extreme damage too, the cane could be uprooted from the ground and die.
  • Sustained winds can also damage the harvesting infrastructure and limit access for field maintenance, further reducing the crop size and yields.
  • The last time Louisiana’s cane fields underwent significant damage was during Hurricane Katrina (Category 5) in 2005.
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  • We do not think the damage caused by Hurricane Laura will be as severe as that caused by Hurricane Katrina.
  • However, the extent of the damage is hard to predict so we will continue to closely monitor the situation.
  • At present, we think the US will produce a rebound crop next season, reaching 4.06m short tons of cane sugar.
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  • Total sugar production should reach 9.27m short tons, up from 7.99m last season.
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Vincent O’Rourke

Vincent began his career at CZ in 2016 as an analyst in the London Office, focusing on raw sugar flows and the Refineries in North Africa and the Middle East. Since 2019 Vincent has moved to the Miami office, leading the Americas analysis (excluding Brazil) and implementing the new data capture and database processes. Vincent graduated from Edinburgh with a master’s in theology in 2015 and completed a Masters in Emerging Economies from King’s London University in 2016

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