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• Sugar production will exceed consumption by nearly 4m tonnes in the 20/21 season.
• This is despite sugar prices being at 10 year lows.
• Global sugar consumption will fall for the first time in 40 years, due to the impact of the coronavirus.

The Return of the Production Surplus

• The world will make too much sugar in 20/21.

• Sugar production show a 13.5m tonne increase year-on-year.
• This means sugar production will likely equal that of the 18/19 season, which was the second highest on record.

• Sugar consumption will fall by 2.5m tonnes in the 19/20 season because of the coronavirus.
• At this early stage, we think consumption will not fully recover in 20/21.
• We suspect sugar consumption will be 3m tonnes lower than it would have been with the normal 1% of growth per year.

Brazil and India Dominate Production in 20/21

• 40% of the sugar produced in the 20/21 season will come from Brazil and India.
• Between them, they will produce 68m tonnes of sugar.

Brazil

• The 20/21 Brazilian crop is well underway; sugar production in the first half of May totalled a record 2.5m tonnes.
• This is because sugar returns being far greater than ethanol returns meant the sugar mix was as high as 47.2% in Brazil.
• Why not see for yourself how this compared to the previous seasons’ mix using our Interactive Crop Progress tool?
• We think Brazil will produce 36m tonnes of sugar in the 20/21 season, matching the record crop of 17/18.

India

• Similarly, Indian production will nearly reach record levels.
• We think they will produce 32m tonnes of sugar in the 20/21 season.
• We do not expect a repeat of 19/20, where insufficient rainfall resulted in empty reservoirs and a subsequent reduction in sugar production.

Russia

• We have just reduced our estimate for Russian sugar production by 700k tonnes to 5.9m tonnes.
• This represents a drop of 1.7m tonnes (22%) from the record 19/20 crop.
• The planted area is almost 20% lower than the initial expectations.
• Up to 80k ha (8% of total area) of sugar beet is being replanted after it was damaged by strong winds and frost.
• We are concerned about the crop development in Krasnodar, the largest beet-growing region, due to a lack of rain.

We will continue to monitor all of the above and provide updates where necessary.