World sugar deficit to increase to almost 3 million tons – ISO

According to the updated June forecast of the International Sugar Organization (ISO), the expected deficit of the world sugar balance in the 2023/24 season (October-September) may amount to 2.95 million tons, compared to 0.689 million tons forecasted earlier in February.

The fundamental factor that influenced the revision of the world sugar balance was a decrease in the forecast estimate of global sugar production in the 2023/24 season to 179.3 million tons, compared to 179.7 million tons earlier in February, due to the expected decrease in sugar production in Thailand (-2.25 million tons compared to the level of the last season 2022/23), India (-1.10 million tons) and Mexico (-0.58 million tons). At the same time, sugar production in the 2023/24 season should exceed the level of the previous season 2022/23 by 1.52 million tons, mainly due to increased production in Brazil (+1.04 million tons), China (+0.98 million tons) and the EU (+0.91 million tons).

The estimate of world sugar consumption in the 2023/24 season increased to 182.2 million tons, compared to 180.4 million tons forecasted earlier in February.

As for world trade in the 2023/24 season, its volumes were revised upward. Exports are estimated at 65.4 million tons, compared to the February estimate of 67.1 million tons, i.e. 1.7 million tons less, while import demand is estimated at 66.8 million tons, which is 0.6 million tons less. Logistical difficulties in Brazilian ports will remain a deterrent to further trade growth.

The revision of the global sugar balance in the current season will be one of the factors of pressure on world sugar prices in 2024, while possible changes in weather conditions, export restrictions and the policy of leading sugar producing countries to adjust the share of ethanol production will be additional factors that will affect world sugar prices this year, which, according to international analysts, may be adjusted by the end of this year.

Tags: supply and demand balance, China, Brazil, EU, prices, sugar, Mexico, India, Thailand