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FYI: Sugar and Sweeteners Summary author: USDA Economic Research
Service series-info: USDA ERS Situation and Outlook Report Summaries
document-date: Mon, 19 Sep 1994 14:11:42 -0400
contact-name: Diane E. Decker, USDA ERS

posting-date: Thu Sep 29 15:43:30 EDT 1994

September 19, 1994

World Sugar Production Forecast Lowered; U.S. Production
Expected To Set Record

USDA forecasts 1994/95 global sugar production and consumption
near 114.0 million metric tons -- approximately in balance.
This anticipated balance would follow deficit seasons in 1992/93
and 1993/94 that have absorbed surplus stocks built up during
1990/91 and 1991/92.  The stocks-to-use ratio for 1994/95 is
forecast at 15.8 percent, down significantly from the early
1990's and one indicator explaining the recent firming of world

World sugar production for 1994/95 is forecast at 114.0 million
metric tons, down 2.3 million from the forecast published in the
June Sugar and Sweetener Situation and Outlook report, but 3.4
million tons above the revised estimate for 1993/94.
Substantially lower production prospects are foreseen for Cuba
because of a generally deteriorating economic situation and
input scarcity. Widespread drought in Europe has caused beet
sugar production forecasts to be trimmed for the EU, producers
in Central Europe, the Ukraine, and the Russian Federation.  A
reassessment of China's beet and cane sugar production prospects
has resulted in a sharp reduction in estimates for both 1993/94
and 1994/95.  The downturn is explained largely by lower area
devoted to sugar crops due to low prices relative to other
crops.  Partially offsetting these declines are upward revisions
in crop prospects in the United States, South Africa, Pakistan,
Thailand, and Australia.

Global sugar consumption for 1994/95 is forecast at 114.0
million tons, down 1.8 percent from the earlier forecast but up
0.6 percent or 700,000 tons from the revised estimate for
1993/94.  The lack of substantial year-to-year growth is due to
stagnant and even declining sugar use in several Central
European countries and the former Soviet Union, particularly the
Russian Federation.  Embarked on a painful economic transition,
these countries have reduced production subsidies and increased
retail prices.  Also, EU consumption is expected to be lower,
reflecting increasing use of alternative sweeteners, and a
reported declining nonfood use of sugar by the chemical
industry.  These declines are largely offset by expanded sugar
use in the Western Hemisphere, particularly the United States,
Mexico, Brazil, and Colombia.  This growth is being spurred
largely by population and income advances.  Asia remains the
engine of world sugar consumption with use forecast at 37.6
million tons in 1994/95, up 3.6 percent from the revised
estimate for 1993/94.  The growth in Asian consumption paused in
1993/94 as China's use dropped sharply and India's use stalled,
due to lower availability in both countries.  For 1994/95,
several countries are likely to have significant growth in sugar
consumption, including Indonesia (up 2.8 percent to 2.8 million
tons), Pakistan (up 7.1 percent to 3.0 million), China (up 7.2
percent to 7.4 million), and India (up 2.9 percent to 14.3

World prices for raw sugar (f.o.b. Caribbean, contract no. 11)
averaged 12.54 cents a pound for the first 11 market days of
September, 12.1 cents in August, and 11.7 cents in July.  A year
ago, prices were 9.5 cents in September, 9.3 cents in August,
and 9.6 cents in July.  For the first half of 1994 the world
price averaged 11.3 cents, up 1.1 cent from a year ago.  The
recent firming of prices appears to reflect the poor outlook for
the 1994/95 Cuban crop, drought-reduced supplies likely in
Europe, and the prospect of sizeable imports by China.

U.S. sugar production in fiscal 1995 (October-September) is
projected at 7.84 million short tons, raw value, up 2.2 percent
from the June estimate and 4.1 percent higher than 1993/94.
Beet sugar production is forecast at a record high of 4.50
million tons 450,000 tons higher than the current year,
reflecting a 2.6 percent increase in harvested area to a record
high 1.44 million acres, improved yields, and on-trend sucrose
recovery.  Beet sugar production from molasses desugaring is
expected at about 260,000 tons in 1995 from six facilities now
in operation.

Cane sugar production for fiscal 1995 is forecast at 3.34
million tons, down 140,000 tons or 4.0 percent from 1994,
largely due to the planned closure of three sugar mills in
Hawaii.  An estimated 873,000 acres are expected to be harvested
for sugar, yielding 28.4 million tons of cane.  The average
sucrose recovery is expected to be 11.8 percent, comparable to
fiscal 1994.

For fiscal 1995, sugar consumption is forecast at 9.28 million
short tons, raw value, up 125,000 tons, or 1.4 percent.  This
translates into per capita consumption of 64.7 pounds for the
nation's 262.9 million population.  The consumption trend over
the past 6 years (1989/90-1994/95) is somewhat higher, at
144,000 tons and 2 percent per year.  The weakening demand
suggests a dampening of offtake caused, in part, by imports of
sugar-containing products.

U.S. sugar stocks at the end of fiscal 1995 (September 30) are
forecast at 1.47 million tons, up 7.7 percent from the revised
estimate for 1994 and reflect a projected supply of 11.28
million tons and use of 9.81 million. The fiscal 1995
stocks-to-use ratio is estimated at 15.0 percent, compared with
the revised, 14.2 percent for 1994.  The U.S. raw sugar futures
price (c.i.f. duty-paid, contract no. 14, New York) for the July
1995 contract was 22.26 cents a pound on September 16, 1994,
with a contract high and low to date of 22.28 cents and 22.00
cents, respectively.

For the year ending September 30, 1994, stocks are estimated at
1.37 million tons, up 12.3 percent from the June estimate as
upward revisions in the supply variables such as domestic
production and quota-exempt imports more than offset changes in
use variables, particularly exports.  U.S. raw sugar prices
(nearby futures) averaged 21.80 cents a pound during September
1-16. This compares with 21.84 cents in August, 22.72 cents in
July, and 22.23 cents in the April-June quarter.

This report contains a special article on the beet sugar
industry in Minnesota and North Dakota.  Printed copies of the
full text will be available in about a week.  Summaries and text
of Situation and Outlook reports are also available
electronically.  For details, call (202)720-9045.

This electronic document was obtained from the Almanac
Information Server at the US Department of Agriculture's
Extension Service.

If you would like a guide to other documents available from the
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Tue, 18 Mar 1997 08:41:41 GMT
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