U.S. sugarbeet growers are poised for a profitable year despite expectations of a large global sugar crop, market analysts with Rabobank predict.
A new report from the Rabobank Food & Agribusiness Research and Advisory Group estimates the world’s sugar growers will overproduce by 2.7 million metric tons in the current crop year.
But U.S. sugar prices should avoid downward pressure from the expected international glut, thanks largely to a recently renegotiated agreement addressing the dumping of subsidized Mexican sugar into the country, explained RaboResearch sugar analyst Stephen Nicholson.
Nicholson said the outlook is for increased production in major sugar-producing countries — including Brazil, India and Thailand.
Domestically, however, USDA estimates U.S. sugar farmers cut their beet acres by 2.7 percent and their cane acres by 3.4 percent. Adverse growing conditions in U.S. sugar production areas should also reduce sugar output, Nicholson said. He said the weather has been especially dry in Minnesota, Montana and the Dakotas, and a turn to humid weather could raise disease pressure.
Source: www.capitalpress.com