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Insight Focus
The USDA revised US sugar supply down slightly in its latest WASDE report, but even that wasn’t enough to spur on more buying activity. Buyers are reluctant to add more coverage although lower domestic production is expected to more than offset higher imports.
US Sugar Supply Down
The cash sugar market was quiet during the week ended June 14, with spot and forward sales at a slow pace. The US Department of Agriculture in its June 12 WASDE report slightly lowered its forecasts of US sugar supply for this year and next year.
Source: USDA
Note: Converted from short tons to tonnes
Bulk refined sugar prices were unchanged. A firmer tone crept into the market, supported in part by the USDA’s downward revision in domestic supplies and by a sharp increase in the 2023-24 global sugar deficit forecast by the International Sugar Organization.
Beet sugar could be bought below 50¢/lb FOB Midwest, with some areas priced in the 51¢/lb to 53¢/lb range. Refined cane sugar was offered below 60¢/lb FOB Northeast and West Coast and slightly above the mid-50¢/lb area in the Gulf and Southeast. Spot refined sugar values were modestly above forward prices.
Sugar Sales Continue
One beet processor remained out of the 2024-25 bulk refined market through September, but other processors continued to sell. Some buyers had yet to put any coverage on for 2025, and one seller noted that a few buyers still have October-December 2024 needs to cover.
Most users had some level of coverage for next year but appeared in no hurry to complete the process or significantly add to coverage. Also, some users continued to work through inventories and were uncertain about future needs. Still, sellers urged buyers to at least put on some coverage or add to existing coverage for 2025. Spot sales also continued but mostly for small volumes.
The USDA in its WASDE report lowered its forecasts of sugar ending stocks as higher imports were more than offset by lower domestic production in 2023-24 and lower beginning stocks and lower production more than offset higher imports in 2024-25. Domestic deliveries for food and total use were unchanged for both marketing years.
The USDA announced the 2024-25 US raw cane sugar tariff-rate quota (TRQ) at 1.17 million tonnes, raw value — the minimum required under World Trade Organization agreements. The refined sugar TRQ was set at 232,000 tonnes, which includes the 22,000-tonne WTO minimum and an additional 210,000 tonnes of specialty sugar. The refined and specialty sugars may enter in tranches as of specific dates October 1, 2024 through July 14, 2025.
Source: USDA
Sugar beet crop condition ratings as of June 9 reported by USDA state offices were mixed from a week earlier but generally favourable, with the most significant drop in good-to-excellent ratings for the week in top-producing Minnesota.
Sugar cane in areas of drought in Florida worsened to 78% severe and 22% moderate as of June 11 from 74% severe and 26% moderate a week earlier. It was hoped recent heavy rains in South Florida would relieve drought conditions.
Corn sweetener markets were quiet. The USDA made no changes to corn for this year or next in its WASDE report.
