Marketing News:
With Brazil’s exports expected to decline, Thailand’s exports limited in the early stages of production, and India’s possible exports, there is a possibility that international sugar trade flows will temporarily tighten before the first quarter of next year. However, despite expectations of a production cut in Brazil during the 24/25 crop season, most countries in the Northern Hemisphere are expecting production increases, and the momentum for continued increases in raw sugar has weakened.
Industry organization Unica said that sugar production in central and southern Brazil totaled 2.44 million tons in the first half of October, up 8% from the same period last year. Total cane crushing volume in the first half of October was 33,830 tons, up 2.75% from the same period last year. Brazil’s production began to decline seasonally until the end of March next year. Brazil’s sugar inventories at the end of September were much lower than in recent years, and there was little inventory pressure, supporting international sugar prices.
India and Thailand will start grinding in late November; India lifts ethanol production restrictions while maintaining export restrictions The Office of the Cane and Sugar Board (OSCB) expects Thai sugar production in 2024/25 to reach 10.39 million tons, up 18%. Thailand is the world's third largest sugar producer and second largest sugar exporter. Thailand consumes around 2.5 million tons of sugar per year, with the rest exported.
Institutional view:
Overseas, Brazil's production has started to decline seasonally and inventory levels are low. India and Thailand have started to tap this month, and Thailand has increased production significantly, with both long-term and short-term factors coexisting. Domestically, expectations are high for increased production in the new year, with production expected to be around 11 million tons, as new sugar from northern beet is launched in large quantities. Southern cane sugar will also be launched in late November. Domestic drivers remain weak, but the downside trend has been supported by supportive international sugar prices.
White sugar has been volatile in recent weeks, with harvesting seasons alternating between the northern and southern hemispheres in November. Production in central and southern Brazil is coming to an end. Low inventories and concerns about next harvest season production have led to overseas sugar prices being supported by major northern hemisphere cane and beet sugar producers. Production is expected to increase significantly, while sugar mills in Yunnan, Guangxi and other places are gradually starting up. It is expected to meet the expectation of increasing domestic production by another 1 million tons. Therefore, sugar prices are expected to maintain a range-bound trend in the short term.
