US Sugar Prices Edge Higher Ahead Of Colloquium

This update is from Sosland Publishing Co.’s weekly Sweetener Report. This update is from Sosland Publishing’s Sweetener Report. For more information and subscription details, CLICK HERE.

Insight Focus

• US sugar cash prices for 2023/24 firmer this week.
• Beet sugar processors have no sugar left to offer this season.
• Cane sugar production estimates lowered in Louisiana and Texas, increased in Florida.

Cash sugar prices for 2023/24 firmed in the week ended Feb. 10. Focus was on the closing of a Montana beet sugar plant and the US Department of Agriculture’s Feb. 8 World Agricultural Supply and Demand Estimates (WASDE) report.

Inquiries from buyers for 2023-24 increased, although actual transactions still were slow. Most business for October-December was completed so focus was on January-September 2024 or calendar 2024. Sources expect trading will pick up sharply after face-to-face meetings on the sidelines of the International Sweetener Colloquium Feb. 26-March 1.

Pricing indications for 2023/24 were mostly higher. Beet sugar was offered at 52½¢ a lb f.o.b. Midwest, up 1½¢ from the most recent quote, and cane sugar was offered at 54¢ to 55¢ a lb f.o.b. Southeast, up 1½¢ to 2½¢ from recent quotes. Large users were said to be able to buy sugar below those levels. Some cane refiners indicated they may enter the market in the 52¢ to 54¢ a lb range f.o.b. Gulf.

Beet sugar sales for 2022/23 were nil as beet processors had no sugar to offer unless buyers failed to take contracted supplies, which could easily be resold at higher levels. Spot prices were unchanged. Cane sugar mainly was available from one major refiner at 62¢ a lb f.o.b. at all locations.

The USDA in its WASDE report lowered from January its forecast of 2022/23 cane sugar production for Louisiana and Texas but raised its estimate for Florida. The decline in Louisiana was expected after a hard freeze in late December affected about 15% of the crop still in the field at the time. But some had expected the Florida estimate to also be lowered due to adverse weather. More surprising was the USDA’s forecast of a 52,000-ton increase in 2022/23 beet sugar production. The USDA continues to estimate higher sucrose recovery from the 2022 beet crop (based on processor reports). Some in the trade thought the beet number would be lowered from January.

The major news of the week, though not a surprise, was American Crystal Sugar Co.’s announcement that it was closing the Sidney, Mont., beet processing plant in April because farmers continued to contract too few acres of sugar beets amid competition from other crops. The market will lose about 75,000 tons of beet sugar from the plant, although some or all of that could be made up by other American Crystal growers and plants.

The USDA in its February Sweetener Market Data report said October-December sugar deliveries for human consumption were down 2.1% from the same period a year earlier. Deliveries for human consumption in December were up 0.9% from December 2021.