February 8, 2023

SUGAR: U.S. sugar supply for 2022/23 is decreased 10,135 short tons, raw value (STRV) from last month as a reduction in sugar production more than offsets small increases in beginning stocks and imports. Louisiana sugar production is reduced by 82,858 STRV to 2.030 million. With the sugar campaign ended, USDA contacted mills regarding final crop year production. Mills confirmed that yields were off from earlier USDA estimates due to the freeze in late December. Cane sugar production in Florida is increased by 24,292 STRV to 2.014 million but is decreased in Texas by 9,790 STRV to 87,182. Both of these changes are from processors’ forecasts in the Sweetener Market Data (SMD). Beet sugar production is increased by 51,898 STRV to 5.100 million. Based on sugar production data for August through December in the SMD, USDA increases its projection of sucrose recovery from 15.000 to 15.204 percent. Cumulative sucrose recovery for the 5 months is estimated at 15.433 percent. This estimate is statistically close to full season recovery, but USDA is exercising some caution in recognition of statistical variance. Even so, five-month averages in all major regions (Red River Valley, Michigan, Great Plains, and Pacific Northwest) exceed 10-year averages. (Processors in SMD are more optimistic forecasting national recovery at 15.592 percent.) The increase due to the higher recovery rate is offset partially by a 10,000 STRV reduction in August-September 2023 production due to the closure of the beet facility in Sidney, Montana. Imports are increased by 4,725 STRV due to an upward revision of raw sugar imports from the 2021/22 TRQ entering in December. With no change in use, the supply changes flow into ending stocks, now projected at 1.874 million STRV for an ending stocks-to-use ratio of 14.8 percent.

The 2022/23 Mexico supply and use is virtually unchanged from last month. USDA still projects production at 5.900 million metric tons (MT). Most factories started late this season, but most have caught up on harvested area from the perspective of the previous 9 campaigns and from the level predicted by CONADESUCA in its pre-season production estimate. There still are significant variations amongst mills, especially those producing refinado sugar. Cumulative sugarcane yields and sucrose recovery through January 28 are still far below corresponding historical levels through the same date and below CONADESUCA forecast. We are soon to enter the period in which USDA forecasting based on to-date progress has enough statistical validity for updating the USDA projection.