WASHINGTON — The US Department of Agriculture’s sharply lower forecast of 2023-24 sugar imports from Mexico was more than offset by a higher tariff-rate quota (TRQ) and high-duty imports, resulting in higher total supply and ending stocks from November and an ending stocks-to-use ratio of 12.8%. 

In the Dec. 8 in World Agricultural Supply and Demand Estimates (WASDE) report, the USDA forecast 2023-24 US sugar ending stocks at 1,624,000 tons, up 3.5% from November but down 12.5% from 1,855,000 tons in 2022-23. The ending stocks-to-use ratio was forecast at 12.8%, up from 12.4% as the November forecast but down from 14.5% in 2022-23 and below the USDA’s minimum target of 13.5%, indicating about another 100,000 tons of sugar is needed to reach the threshold, with considerably more supply needed to ease sugar users’ concerns about expected tight supplies in 2023-24. 

The USDA forecast total 2023-24 imports at 3,256,000 tons, up 126,000 tons from November but down 358,000 tons from 2022-23. TRQ imports were forecast at 1,620,000 tons, up 162,855 tons from last month and reflecting only partial entry of the 223,740-ton raw sugar TRQ reallocation announced Nov. 29. That would leave a TRQ shortfall of 91,776 tons, down from a shortfall of 254,632 tons forecast in November, the USDA said. Imports from Mexico, which is enduring a second consecutive year of drought, were forecast at 971,079 tons, down 227,461 tons, or 19%, from November and down 16% from 2022-23. High duty imports were forecast at a record-high 465,000 tons, up 190,000 tons, or 69%, from November and up 10,000 tons from 2022-23, including 290,000 tons of raw sugar and 175,000 tons of refined sugar, and indicating US refiners and sugar users will need to find extra supply in the high-duty market to offset lower shipments from Mexico unless the USDA takes action to increase TRQ imports.

US 2023-24 sugar production was forecast at 9,243,000 tons, up 14,000 tons from November, including beet sugar at a record-high 5,363,000 tons, unchanged, and cane sugar at 3,880,000 tons, up 14,000 tons, mostly due to a 12,250-ton bump in Louisiana.

With a 20,000-ton reduction in beginning stocks, total sugar supply in 2023-24 was forecast at 14,354,000 tons, up 119,852 tons from November but down 329,000 tons from 2022-23.

Exports were forecast at 100,000 tons in 2023-24, up 65,000 tons from November and up 18,000 tons from last year. There were no changes in forecast deliveries for food, leaving total sugar use forecast at 12,730,000 tons, up 65,000 tons.

Minimal changes were made to 2022-23 estimates with ending stocks forecast at 1,855,000 tons, down 20,000 tons from November due mainly to higher miscellaneous use.

The USDA lowered from November its forecast 2023-24 sugar production for Mexico by 47,000 tonnes, actual weight, to 5,283,000 tonnes, which is above the estimate from Mexico’s CONADESUCA of 5,188,000 tonnes and well above many analysts’ expectations as drought persists south of the border. Imports in 2023-24 were forecast at 285,869 tonnes, down 147,669 tonnes from November and about even with 2022-23. Exports were forecast at 856,083 tonnes, down 194,669 tonnes from November and offsetting a like reduction in forecast supply, leaving ending stocks unchanged at 900,000 tonnes. 

The USDA forecast Mexico’s production of low-polarity sugar for export to the United States at 632,751 tonnes, equal to 75% of total exports to the United States of 831,083 tonnes with exports to other countries forecast at 25,000 tonnes.