World Agricultural Supply And Demand Estimates – September 2023

Published online: Sep 12, 2023 News
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SUGAR: U.S. sugar supply for 2022/23 is raised by 90,589 short tons, raw value (STRV) on increased production and imports while use is decreased by 55,000 on lower deliveries partially offset by an increase in exports.

Beet sugar production is increased 31,812 STRV on final August-July crop year production reported by processors in the SMD. Production benefitted from high relative levels of sucrose recovery in all regions but especially in the Red River Valley. The production estimate for August and September 2023 for sugarbeets harvested this season is unchanged.

A small reduction is made for lower cane sugar production than reported last month for Texas. High-tier tariff imports are increased by 60,000 STRV on additional imports of raw sugar by cane refiners in August. High-tier tariff refined sugar imports for August were close to that estimated last month and are, therefore, unchanged.

For use, deliveries for human consumption are lowered 75,000 STRV to 12.500 million, reflecting a continuing decrease in the delivery pace seen these last few months and with only two months of remaining data to be reported in the fiscal year. These final month deliveries can be influenced by the level of beet sugar production occurring during this period. The delivery decrease is partially offset by a combined 20,000-STRV increase in exports and deliveries to re-export sugar product manufacturers. Ending stocks are increased by 145,589 STRV to 2.159 million for ending stocks-to-use ratio of 17.06 percent, an increase of 1.22 percentage points over last month.

U.S. sugar supply for 2023/24 is decreased by 277,945 STRV on decreases in production and imports only partially offset by an increase in beginning stocks. Cane sugar production for 2023/24 in Louisiana is lowered by 371,403 STRV to 1.682 million. NASS lowered Louisiana sugarcane yield to 27.2 tons/acre reflecting the effect of the ongoing widespread drought. Because processors were unchanged in their aggregate assessment of sucrose recovery, sugar production is lowered by the full effect of the lower yield on sugarcane.

NASS increased the sugarbeet yield on the national level to 31.5 tons/acre and also increased area harvested by a small amount, implying an increase in beet sugar production to 5.223 million STRV, an increase of 149,619 over last month. Sugar imports from Mexico are lowered by 201,750 STRV in anticipated accordance with the CVD Suspension Agreements administered by the DOC. Use is lowered by 50,000 STRV on lower deliveries for human consumption on a continuation of the slowing trend of deliveries seen in the second half of 2022/23. Supply and use changes imply lower ending stocks of 1.714 million STRV for an ending stocks-to-use ratio of 13.5 percent. Mexico sugar supply for 2022/23 is increased by 53,598 metric tons (MT) to 6.442 million on an increase in imports. Sugar stocks have decreased substantially in May-July driving domestic prices to historically high levels, incentivizing high-tier tariff imports. A wide range of imports between 215,000 and 292,000 MT are considered plausible and a mean level of 253,598 MT is estimated in the WASDE.

Mexico sugar production for 2023/24 is lowered by 100,000 to 5.800 million MT due to the ongoing widespread drought. Imports to the United States are projected at 1.099 million MT as per the CVD Suspension Agreement provisions as indicated above.

WHEAT: The 2023/24 U.S. all wheat outlook for supply and use is unchanged this month with offsetting by-class changes on exports. The projected 2023/24 season-average farm price is also unchanged at $7.50 per bushel. The 2023/24 global wheat outlook lowers supplies, consumption, exports, and ending stocks compared with last month.

Supplies are projected to decline 7.2 million tons to 1,054.5 million, primarily on lower production for Australia, Canada, Argentina, and the EU, which is only partly offset by an increase for Ukraine. If realized, this would be the first year-to-year decline in global wheat production since 2018/19. Australia is reduced 3.0 million tons to 26.0 million as dry weather this past month in Western Australia, New South Wales, and Queensland lowers yield prospects.

Canada is decreased 2.0 million tons to 31.0 million on the initial model-based forecast by Statistics Canada for the 2023/24 crop, indicating lower yields from last year arising from dry conditions across the Prairies. Despite smaller global supplies, world consumption is nearly unchanged with decreased Food, Seed, and Industrial use mostly offset by increased feed and residual use. Feed and residual use is raised by 1.0 million tons for both China and the EU due to wet weather during harvest that is expected to result in higher amounts of lower-quality wheat used for feed. Global trade is trimmed 2.1 million tons to 207.3 million as reductions for Australia, Canada, and the EU are only partly offset by increases for Russia and Kazakhstan.

World ending stocks are reduced 7.0 million tons to 258.6 million and would be the lowest since 2015/16. Ending stocks are tightened in many countries this month, particularly for several major wheat exporters.