• The February WASDE revealed that the US could now produce a record 9.3m short tons of sugar in 2020/21.
  • If this materialises, its stocks-to-use ratio (STU) will hit 16.1%.
  • This isn’t meant to climb higher than 13.5%, so the US will need to limit Mexico’s access in March to keep stocks under control.

The February WASDE Release

undefined
  • The USDA has upped its US sugar production estimate to 9.3m tonnes, following improved cane and beet development.
  • With this, the USDA must revise its import allocations to ensure it meets the mandated 13.5% STU ratio.
  • To do so, it will limit the amount of sugar imported from Mexico, as per the 2014 Suspension Agreement, which stops the US market being flooded with sugar in such circumstances.
  • However, this agreement limits the decrease to 80% of the December estimate, where imports totalled 1.16m short tons.
  • The USDA will therefore need to find another way in which it can reduce supply to the domestic market…
undefined

undefined

Other Opinions You Might Be Interested In…

Other Interactive Data You Might Be Interested In…

undefined

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

More from this author