Sugar prices end solidly higher after recent decline
May NY World Sugar #11 (SBK24) Wednesday's closing price was +0.09 (+0.45%), August London ICE White Sugar #5 (SWQ24) ended at +3.40 (+0.59%).
Sugar prices recorded a modest rise on Wednesday, consolidating recent declines. Short covering has pushed sugar prices higher since last Thursday, Conab cut Brazil's 2023/24 sugar production forecast by -2.6% to 45.7 MMT from November's forecast of 46.9 MMT. Conab's sugar production forecast for Brazil was downgraded as Conab raised its 2023/24 ethanol production forecast for Brazil to 29.7 billion liters from its November forecast of 28 billion liters.
Last Wednesday, New York sugar fell to a 15-month low and London sugar to a 14-month low on improving supply prospects. Last Friday, Unica reported that sugar production in south-central Brazil in the second half of March was 183,000 tonnes, an increase of +9% compared to last year. Additionally, Brazil's sugar production from the 2023-24 marketing year to March has so far increased by +25.7% year-on-year to 42.425 MMT. Brazil's sugar mills are increasingly crushing sugarcane to produce more sugar and less ethanol. Mills have crushed 48.87% of total sugarcane for sugar production this year, up from 45.86% last year.
On the positive side, the Indian Sugar and Bioenergy Manufacturers Association last Tuesday said that India's forecast for 2023/24 from October to April 15 is due to more sugar mills shutting down by the end of the year and sugar mill crushing being completed. It was reported that sugar production in 2019 decreased by 0.5% from the previous year to 31.09 MMT. sugar cane. As of April 15, 84 sugar mills in India were still producing sugar, up from 132 mills that were operational during the same period last year.
Lower sugar production in India is a bullish factor for prices. Monsoon rainfall in 2023 (June to September) was 6% below average and was the lowest monsoon rainfall in the last five years. In October, India extended sugar export restrictions from October 31 until further notice to maintain sufficient domestic supplies. India has allowed sugar mills to export only 6.1 MMT of sugar till September 30 in the 2022/23 season, while it had allowed a record 11.1 MMT of sugar exports in the previous season. India is the world's second largest sugar producer.
Also, the prospect of an above-average monsoon in India this year will weigh on sugar prices, potentially leading to an increase in India's sugar production. The India Meteorological Department has predicted that the 2024 (June-September) monsoon period will be 106% of the long-term average of 87 centimeters.
Another bearish factor for sugar is the Thai government's report on Monday that Thailand's 2023/24 sugar production from December to April 17 was at 8.77 MMT, with February sugar production by the Sugar Corporation of Thailand at 8.77 MMT. This showed that the production exceeded the production forecast of 7.5MMT.
Supporting sugar is an April 9 report in Bloomberg that India may allow sugar mills to use more sugar to make ethanol. The Indian government is considering allowing factories to use an additional 800,000 tonnes of sugar to produce ethanol this year. The move suggests that the government will not ease sugar export restrictions anytime soon.
In a bear market for sugar, the Indian Sugar and Bioenergy Manufacturers Association on March 13 revised its forecast for India's sugarcane production for 2023-24 (starting October 1) by 2.9% from the January forecast of 33.05 MMT. The rate was raised to 34MMT. MMT. More sugarcane production can also lead to more refined sugar production, depending on how much sugarcane is converted to ethanol.
Sugar prices are bullish due to a decline in Thailand's sugar production. Rainfall in Thailand is lower than at the same time last year, and the current El Niño phenomenon may continue to reduce rainfall in Thailand. Thai sugar millers have reported the lowest yield from sugarcane crushing this year in at least 13 years. Thailand is the world's third largest sugar producer and second largest sugar exporter.
As of April 2024, NOAA predicts that El Niño will end and the tropical Pacific will transition to neutral conditions, benefiting weather patterns in South America and Asia and supporting global sugar crops.
In its semi-annual report released on November 23, the USDA said that global sugar production in 2023/24 will increase by +4.7% year-on-year to a record 183.461 MMT, predicted that human sugar consumption would increase by +1.2% year-on-year. /y records 178.431 MMT. The USDA also predicted that global sugar terminal stocks in 2023/24 would decline by -13.3% year-on-year to 33.681 MMT, a 13-year low. On February 28, the International Sugar Organization (ISO) raised its forecast for a global sugar shortage in 2023/24 to -689,000 tonnes from -335,000 tonnes predicted in November.
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On the date of publication, rich asplund I had no position (directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. Please see the Barchart Disclosure Policy for more information. here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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May NY World Sugar #11 (SBK24) Wednesday's closing price was +0.09 (+0.45%), August London ICE White Sugar #5 (SWQ24) ended at +3.40 (+0.59%).Sugar prices recorded a modest rise on Wednesday, consolidating recent declines. Short covering has pushed sugar prices higher since last Thursday, Conab cut Brazil's 2023/24 sugar production forecast by -2.6% to 45.7 MMT from November's forecast of 46.9 MMT. Conab's sugar production forecast for Brazil was downgraded as Conab raised its 2023/24 ethanol production forecast for Brazil to 29.7 billion liters from its November forecast of 28 billion liters.
Last Wednesday, New York sugar fell to a 15-month low and London sugar to a 14-month low on improving supply prospects. Last Friday, Unica reported that sugar production in south-central Brazil in the second half of March was 183,000 tonnes, an increase of +9% compared to last year. Additionally, Brazil's sugar production from the 2023-24 marketing year to March has so far increased by +25.7% year-on-year to 42.425 MMT. Brazil's sugar mills are increasingly crushing sugarcane to produce more sugar and less ethanol. Mills have crushed 48.87% of total sugarcane for sugar production this year, up from 45.86% last year.On the positive side, the Indian Sugar and Bioenergy Manufacturers Association last Tuesday said that India's forecast for 2023/24 from October to April 15 is due to more sugar mills shutting down by the end of the year and sugar mill crushing being completed. It was reported that sugar production in 2019 decreased by 0.5% from the previous year to 31.09 MMT. sugar cane. As of April 15, 84 sugar mills in India were still producing sugar, up from 132 mills that were operational during the same period last year.Lower sugar production in India is a bullish factor for prices. Monsoon rainfall in 2023 (June to September) was 6% below average and was the lowest monsoon rainfall in the last five years. In October, India extended sugar export restrictions from October 31 until further notice to maintain sufficient domestic supplies. India has allowed sugar mills to export only 6.1 MMT of sugar till September 30 in the 2022/23 season, while it had allowed a record 11.1 MMT of sugar exports in the previous season. India is the world's second largest sugar producer. Also, the prospect of an above-average monsoon in India this year will weigh on sugar prices, potentially leading to an increase in India's sugar production. The India Meteorological Department has predicted that the 2024 (June-September) monsoon period will be 106% of the long-term average of 87 centimeters.Another bearish factor for sugar is the Thai government's report on Monday that Thailand's 2023/24 sugar production from December to April 17 was at 8.77 MMT, with February sugar production by the Sugar Corporation of Thailand at 8.77 MMT. This showed that the production exceeded the production forecast of 7.5MMT.
Supporting sugar is an April 9 report in Bloomberg that India may allow sugar mills to use more sugar to make ethanol. The Indian government is considering allowing factories to use an additional 800,000 tonnes of sugar to produce ethanol this year. The move suggests that the government will not ease sugar export restrictions anytime soon. In a bear market for sugar, the Indian Sugar and Bioenergy Manufacturers Association on March 13 revised its forecast for India's sugarcane production for 2023-24 (starting October 1) by 2.9% from the January forecast of 33.05 MMT. The rate was raised to 34MMT. MMT. More sugarcane production can also lead to more refined sugar production, depending on how much sugarcane is converted to ethanol.Sugar prices are bullish due to a decline in Thailand's sugar production. Rainfall in Thailand is lower than at the same time last year, and the current El Niño phenomenon may continue to reduce rainfall in Thailand. Thai sugar millers have reported the lowest yield from sugarcane crushing this year in at least 13 years. Thailand is the world's third largest sugar producer and second largest sugar exporter.As of April 2024, NOAA predicts that El Niño will end and the tropical Pacific will transition to neutral conditions, benefiting weather patterns in South America and Asia and supporting global sugar crops. In its semi-annual report released on November 23, the USDA said that global sugar production in 2023/24 will increase by +4.7% year-on-year to a record 183.461 MMT, predicted that human sugar consumption would increase by +1.2% year-on-year. /y records 178.431 MMT. The USDA also predicted that global sugar terminal stocks in 2023/24 would decline by -13.3% year-on-year to 33.681 MMT, a 13-year low. On February 28, the International Sugar Organization (ISO) raised its forecast for a global sugar shortage in 2023/24 to -689,000 tonnes from -335,000 tonnes predicted in November.
more sugar news from bar chart
On the date of publication, rich asplund I had no position (directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. Please see the Barchart Disclosure Policy for more information. here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
https://www.nasdaq.com/articles/sugar-prices-finish-higher-on-consolidation-after-recent-losses Sugar prices end solidly higher after recent decline
