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Mexico Sugar Production Reduced; U.S. Sugar
Supply Increased
In the April World Agricultural Supply and Demand Estimates (WASDE), the forecast for Mexico’s 2023/24 sugar production is reduced from last month by 175,000 metric tons (MT), actual weight, to a 25-year low of 4.572 million MT. Consequently, exports to the United States are reduced by 143,000 MT to 427,000, the lowest in 17 years and about 13-percent lower than the maximum exports Mexico indicated it can supply during the March consultation with the U.S. Department of Commerce. Due to the reduced crop, Mexico’s Secretaría de Economía announced on April 5 that sugar imports benefitting from USDA re-export programs would be temporarily allowed duty-free until August 31 to fulfill Industria Manufacturera, Maquiladora y de Servicios de Exportación (IMMEX) requirements.
The U.S. 2023/24 supply is raised by 58,000 short tons, raw value (STRV) to 14.474 million as the reduction in beet sugar production due to lower sucrose recovery is offset by the increase in imports. Based on a strong pace, the raw sugar component of high-tier duty imports is increased by 140,000 STRV, raising the total to a record 855,000 STRV. Thus, high-tier duty imports would overtake Mexico as the second largest import category behind raw sugar tariff-rate quota. Exports are raised by 38,000 STRV to 198,000 on expectation of additional exports to Mexico. With domestic deliveries unchanged at 12.555 million STRV, ending stocks are raised by 21,000 STRV to 1.722 million. The corresponding stocks-to-use ratio is 13.5 percent, up from last month’s 13.4 percent.
