In the 2023/24 cycle, Mexico’s sugar industry encounters formidable challenges. The estimated production stands at 4.875 million metric tons, reflecting a decrease of 141,000 metric tons since the last month and 349,248 metric tons less than the previous year. This downturn is primarily attributed to the sluggish pace of the sugarcane harvest, a situation that is unprecedented in recent history. As of February 2, critical production metrics, including yields and sucrose recovery rates, are significantly below the 10-year averages, with no immediate signs of improvement. A notable factor contributing to this slowdown is the unseasonably late rainfall experienced across the country, with the exception of the drought-stricken Northeast, which has further delayed the harvest.
CONADESUCA’s latest data forecasts a national sugarcane yield of 62.6 metric tons per hectare and a sucrose recovery rate at an all-time low of 10.03 percent. These projections are based on an estimated harvested area of 776,408 hectares.
Turning our attention to export projections and their impact on the U.S. market, Mexico’s production of low polarity sugar, earmarked for export to the United States, is anticipated to constitute 10.5 percent of its total sugar output. This aligns with CONADESUCA’s estimates. Assuming this segment continues to represent 75 percent of Mexico’s total sugar exports, the forecast for shipments to the U.S. is pegged at 683,752 metric tons. Meanwhile, exports to other destinations are expected to remain at 25,000 metric tons, bringing the total export figure to 708,752 metric tons—a decrease of 105,328 metric tons from earlier projections. Despite these adjustments, domestic deliveries and ending stocks are anticipated to remain stable, with imports now expected to increase by 35,672 metric tons, reaching 546,538 metric tons.
In the U.S., the sugar supply for the 2023/24 period has been adjusted downward by 23,392 short tons, raw value, primarily due to a decrease in beet sugar production. This reduction is only partially offset by slight increases in cane sugar output and imports. The February update from the Sweetener Market Data indicates a reduction in beet sugar production by 79,297 short tons, raw value, settling at 5.327 million. On a brighter note, Louisiana’s cane sugar production has been revised upwards by 31,500 metric tons to 1.935 million, based on industry reports, and Florida’s output has seen a modest increase of 7,943 short tons, raw value.
Regarding imports, there’s been an increase of 16,462 short tons, raw value, buoyed by a significant hike of 140,000 short tons, raw value, in high-tier tariff imports. This increase more than compensates for the decline in imports from Mexico. High-tier tariff imports have been revised upward, reflecting actual import data up to February 5, with projections of 475,000 short tons, raw value, for raw sugar, and 240,000 short tons, raw value, for refined sugar, based on the import pace from October to January.
Human consumption deliveries within the U.S. are now expected to decrease by 75,000 short tons, raw value, to 12.450 million, based on current trends. However, with the decrease in consumption outpacing the reduction in supply, ending stocks are projected to increase by 51,608 short tons, raw value, to 1.805 million. This results in a stocks-to-use ratio of 14.2 percent, an increase from 13.7 percent in the previous month.