SO AS 2023 REACHES ITS HALFWAY POINT WHAT ARE THE PROSPECTS FOR SUGAR OVER THE COMING MONTHS? Much will depend on three factors: • Brazilian 2023/24 harvest, • The Indian monsoon, and • Overall demand.
Brazilian 2023/24 harvest The Brazilian CS cane crop for the current harvest is looking in superb condition with many believing up to 600 million tonnes of cane could be crushed with up to 37 million tonnes of sugar produced by season’s end. With sugar prices at multi-year highs the mills will be looking to make as much sugar as possible. Ethanol parity is way below current levels and likely to remain so given global energy prices, Brazilian fuel pricing policy and more ethanol being produced from corn.
The Indian monsoon The Indian monsoon is scheduled to start a few days late this year but should hit the coast of Kerala by the second week of June. Currently, Indian forecasts are predicting an average monsoon which is normal in front of its start. However, the
bulls are pointing to the fact that the last four monsoons have been good, so by the laws of average, the country is due a poor one.
Mix in the probability of El Nino developing over the coming months and many are already marking down production for next season. However, some caution might be in order. El Nino does not always guarantee lower monsoon rains especially if it is only just developing. Secondly, the largest sugar producing state, Maharashtra, has had above average summer rains and, finally, it is the distribution of the rains that is key to a successful monsoon.
Other producers will be watched closely for any developing weather issues. Thailand’s last harvest production was lower than anticipated and with competition from other crops, the weather will have to be ideal for production to improve.
The EU has seen some country’s beet plantings start late due to wet weather which could impact on final yields. The total planted areas have yet to be determined. Very high EU white sugar prices should encourage farmers especially as grain
10 | ADMISI - The Ghost In The Machine | Q2 Edition 2023
THE BRAZILIAN CS CANE CROP FOR THE CURRENT HARVEST IS LOOKING IN SUPERB CONDITION WITH MANY BELIEVING UP TO 600 MILLION TONNES OF CANE COULD BE CRUSHED…
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