WASHINGTON — Following the release of its March 10 World Agricultural Supply and Demand Estimates report that reflected a potential US sugar shortage, the US Department of Agriculture announced the US Department of Commerce (at USDA’s request) had acted to boost refined sugar imports from Mexico.

“Current market conditions point to a sugar shortage,” the USDA said.

“Consistent with the Commerce Department’s Agreement Suspending the Countervailing Duty Investigation on Sugar From Mexico, the US Department of Agriculture (USDA) today notified the Department of Commerce (Commerce) of an additional need for sugar in the US market of 200,000 short tons raw value (STRV) of refined sugar,” the USDA said. “Consequently, Commerce has increased the quantity of Mexican refined sugar permitted to be exported by 200,000 STRV for the Oct. 1, 2019, through Sept. 30, 2020, period.

“This action is a further step in ensuring an adequate supply of sugar to the US market, given the terms of the US sugar program and the Agreement Suspending the Countervailing Duty Investigation on Sugar from Mexico.”

At USDA’s request, the DOC on Nov. 25, 2019, increased Mexico’s refined sugar export limit by 100,000 tons after it became evident US beet and cane sugar production would be down sharply from 2018-19.

“In the same way as the November request, today’s increase in Mexico’s refined sugar export limit will only change the mix between refined and other sugar,” the USDA said.

The USDA said it would continue to monitor the market to asses supplies.

In its March 10 WASDE, the USDA lowered forecasts for US beet sugar production and drastically cut forecast imports from Mexico, resulting in an 2019-20 ending stocks-to-use ratio of 7.2%, down from 12.4% forecast in February and compared with 14.5% in 2018-19. US sugar ending stocks were forecast at 887,559 tons, down 41% from the February forecast and down 50% from 2018-19.

The USDA is required to maintain the US ending stock-to-use ratio at 13.5% under terms of the suspension agreements with Mexico. Prior to the March 10 action to boost refined sugar imports by 200,000 tons, the shortfall in US supply to get to 13.5% was 768,000 tons.

The USDA on March 10 also forecast Mexico’s 2019-20 sugar production at 5,200,000 tonnes, actual weight, down 19% from 2018-19 due mainly to drought during the growing season, and slashed forecast 2019-20 exports of sugar from Mexico to the United States by 472,287 tonnes from February to 996,834 tonnes.