Bangladesh has imported 1.9m tonnes of raw sugar so far in 2020, up 20% year-on-year.
This is an unusually large amount for Bangladesh to import but record imports in Q1’20 left stocks high as coronavirus battered sugar consumption.
We think imports will now slow down until domestic stocks reach a comfortable level.

Bangladesh Has Already Imported 20% More Sugar Than Last Year

Bangladesh imported a record 970k tonnes of raw sugar in the first quarter of 2020.
The weak Oct’19/Mar’20 No.11 spread provided the refineries with a good opportunity to buy sugar at a 100 point discount to the No.11 March contract.

Bangladesh has imported 1.9m tonnes of sugar so far this year; this is a large amount considering Bangladesh imported 2.1m tonnes in the whole of 2019!
343k tonnes arrived from Brazil in August alone.
Such strong imports left Bangladesh’s sugar stocks extremely high, but with coronavirus lockdowns reducing sugar consumption, this sugar is even harder to shift.
We have heard rumours that Bangladeshi refineries tried to wash out existing contracts due to the down-tick in consumption.

Why the Strong Import Flow?

Back in June and July, Bangladeshi refineries had ample stocks, so it’s quite possible they wanted to delay their shipments.

They may have done so by selling their spaces in the Brazilian vessel queue to someone else.
However, even if they did do this, they would eventually have to import the sugar they had bought, which would cause a surge of shipments like the one seen throughout August.
Once this flurry of shipments has fizzled out, we think Bangladesh’s raw sugar demand should reduce until stocks return to normal levels.

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