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US Sugar Production Forecast Lowered, While Mexico Output Revised Upward

The USDA has revised its production forecasts for US sugar, decreasing estimates for both the 2023/24 and 2024/25 marketing years. Meanwhile, Mexico's sugar production for 2023/24 has been adjusted upwards, according to the latest report published by the USDA.

The US sugar supply for the 2023/24 marketing year has been reduced by 34,000 short tons, raw value (STRV), to 14.377 million STRV, primarily due to a decrease in beet sugar production. The report also notes a reduction in Florida's cane sugar production for the 2024/25 marketing year, driven by a lower forecast from sugarcane processors.

"In 2023/24, U.S. sugar supply is reduced from last month by 34,000 short tons, raw value (STRV) to 14.377 million on lower production more than offsetting higher imports," the USDA states. "Production is down 50,000 STRV to 9.080 million solely on the reduction in beet sugar output to 5.045 million."

The report highlights the impact of reduced sucrose recovery rates and increased beet pile shrink on US beet sugar production.

"Sucrose recovery (the percent of sugar recovered from sliced sugarbeets) is reduced from 14.75 to 14.70 percent based on processors’ actual production through April in the SMD," the USDA explains. "Following beet processors’ submission in the SMD, shrink (the percent change representing the loss of sugarbeet weight from the time of piling until the time of slicing) is increased from 9.0 to 9.1 percent."

On the other hand, Mexico's 2023/24 sugar production has been revised upward by 69,000 metric tons (MT) to 4.718 million MT, based on production data through week 35 released by CONADESUCA, Mexico's National Committee for the Sustainable Development of Sugarcane. This increase reflects a potential expansion of the harvested area to 740,000 hectares.

"Mexico’s 2023/24 sugar production is raised from last month by 69,000 metric tons, actual weight, to 4.718 million—still a 25-year low—on the expectation that area harvested could reach 740,000 hectares," the USDA notes.

The report also notes that Mexico's exports to the United States are projected to decrease due to a reduction in the expected production of low-polarity sugar, which is produced exclusively for the US market.

"This implies that low polarity sugar production would be 283,000 MT (4.718 million MT multiplied by 6 percent)," the report explains. "With the estimated share of low polarity sugar in total exports to the U.S. still at 71 percent, Mexico’s total exports to the U.S. would be 399,000 MT (i.e., 283,000 MT divided by 0.71)."