This season, the pattern of shipments of Mexican sugar to the U.S. has been atypical, greatly influenced by the newest iteration of import rules under the Suspended Agreements. From October through August, cumulative imports of Mexico sugar reached an estimated 1.084 MMT, raw value, up 16 percent from the same period a year ago. This volume, however, is down 20 percent from the five-year average, which underscores the difference in both the U.S.-Mexico sugar trade—as does the higher volume of sugar shipped from the U.S. to Mexico this season.
Naturally, pricing differences are also a factor, including unusual price patterns in Mexico and the strong global sugar surplus. Despite some early skepticism, Mexico’s sugar industry has met the U.S. quota for sugar of a polarity lower than that which they have historically produced.
Last week, USDA halved its forecast for 2018/19 imports of Mexican sugar from 1.655 million STRV (1.50 MMT) to just 842,000 STRV (764,000 MT). This lowered all Mexico’s forecast exports for 2018/19 from 1.427 MMT to 995,000 MT. WASDE also cut 21,000 MT from estimated exports for 2017/18. These lower export forecasts for both seasons raised the 2018/19 carryout forecast from 1.008 MMT to 1.461 MMT, a 15 percent increase from 2017/18 carryout of 1.268 MMT. As a result, the 2018/19 stocks-to-use (STU) ratio rose to 25 percent, up from the previous estimate of 16 percent and from the 2017/18 STU now estimated at 21 percent.
Monthly U.S. imports of sugar from Mexico by crop year
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