USDA ERS: Sugar and Sweeteners Outlook March 15, 2022
Total Imports Raised; Still Lowest Since 2008/09
The March 2022 World Agricultural Supply and Demand Estimates (WASDE) publication lowered U.S. sugar ending stocks for 2021/22 on smaller supply and larger use. The reduction in domestic production is not fully countered by increased imports, which are forecast to be at the lowest level since 2008/09. High-tier imports are raised 25,000 short tons, raw value (STRV) to 175,000 on strong pace (figure 1). Per the Suspension Agreement, the Export Limit for Mexico is expected to be marginally lower than last month. The net effect is a stocks-to-use ratio of 13.6 percent, down from 14.7 percent in February. Mexican 2021/22 sugar supply and use only changed slightly.
U.S. Outlook Summary
Sugar Ending Stocks Lowered
The March 2022 World Agricultural Supply and Demand Estimates (WASDE) publication lowered U.S. sugar ending stocks for 2021/22 to 1.692 million short tons, raw value (STRV)— 126,152 less than last month—on smaller supply and larger use (table 1). The outlook for supply is down 26,152 STRV as the reduction in domestic production is not fully countered by increased imports. Beet sugar production is reduced 12,183 STRV to 5.389 million primarily on lower sucrose extraction and larger beet pile shrink reported by the processors. Florida cane sugar production is lowered 45,059 STRV to 1.960 million, also based on processor reporting which incorporated the effect of the late January freeze to the crop. Imports are up 31,091 STRV from last month to 3.043 million but would still be the lowest since 2008/09. World Trade Organization (WTO) raw sugar tariff-rate quota (TRQ) imports are increased 20,591 STRV due to a lower-than-expected shortfall, while high-tier imports are up 25,000 STRV to 175,000 on pace to date. Based on the terms of the Suspension Agreement, the Export Limit calculated by the U.S. Department of Commerce later in March is expected to be 1.037 million STRV, about 14,500 tons lower than last month’s 1.052 million. Note that the WASDE projects a larger import number for Mexico at 1.050 million STRV due to the inclusion of 12,812 STRV that entered in October 2021 but counted against the 2020/21 Export Limit. U.S. sugar deliveries for human consumption is raised 100,000 STRV to 12.3 million on strong delivery pace for beet sugar and direct consumption imports. The net effect is a stocks-to-use ratio of 13.6 percent, which is down by 1.1 percentage points from the prior month’s 14.7 percent.
DW Montgomery & Company has provided extensive market and contractual expertise within the sugar industry for over 70 years. Our family has now three generations working within the business and has grown to include a large variety of organic and natural ingredients. It is our pleasure to serve you and assist you in your purchasing needs.
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David Montgomery, Jr., Paul Montgomery, Andrew Montgomery, and David Montgomery III