U.S. sugar production is projected to increase at a gradual rate over the next decade.
Total sugar production in 2024/25 is projected to be just 4.6% higher than in 2015/16. Both beet and cane sugar production will increase over this time period, with a slightly larger rate of growth for beet sugar. Production growth for both beet sugar and cane sugar is expected to come from higher yields and sucrose recovery rates, as area harvested is expected to decline slightly over the projection period.
Sugar deliveries for domestic use will increase steadily over the course of the decade. Deliveries in 2024/25 are expected to be 7.9% higher than in 2015/16. This increase follows projected population increases.
Total sugar use is projected to increase at a higher rate than domestic production. As a result, sugar imports are expected to increase over the next 10 years, with imports at the end of the projection period 9.7% above the 2015/16 estimates. Particularly in the latter years of the projection period, increased imports are expected to come from tariff-rate-quota (TRQ) imports as imports from Mexico are expected to be constrained by lower Mexican sugar production.
A moderate decline in Mexican sugar production is projected, with reductions in area eclipsing gains in yield. Projected production reaches a low point in 2021/22 and then rises over the last few years of the projection period. Steadily increasing domestic consumption combined with lower total supplies will result in declining exports although, similar to production, exports will reach a low point midway through the projection period before slight increases are seen in the last few years of the projection period.
The projections assume that limitations on Mexico's exports to the United States based on calculated U.S. needs are in place as described in policy agreements between the U.S. and Mexican Governments signed in December 2014. Thus, Mexico's sugar exports to the United States are assumed at levels that hold the U.S. stocks-to-use ratio at 13.5%.