Sugar Supplies Could Tighten in 2002-03

WASHINGTON - May 10/02 - STAT -- The USDA is looking for a solid increase in sugar output levels in the United States on account of projected increase in both beet and cane sugar production levels.

Projected U.S. sugar production for fiscal year 2002-03 is 8.75 million short tons, raw value, up 746,000 tons from 2001-02. Beet sugar production is projected at 4.5 million tons, up 500,000 tons, based mainly on increased acreage. Projected cane sugar production is 4.25 million tons, up 246,000 tons, based mainly on per-acre productivity increases.

Projected 2002-03 non-program imports are 60,000 tons, down 30,000 tons due to lower projected imports of high-tier sugar from Mexico. The 2002-03 tariff rate quota (TRQ) has not been announced. On the use side, deliveries for use in domestic food and beverages are projected at 10.085 million tons, up 100,000 tons.

If the TRQ is set at a level which allows imports to finish the coming season around 1.1 million tons then total supply would reach 11.467 million tons. With consumption expected to reach 10.21 million tons, this would force a further reductiuon in ending stocks to from 1.617 to 1.257 million tons. If this deemed low, the TRQ would probably be increased from this season's 1.179 million MT to maintain market liquidity.

For 2001-02, cane sugar production is decreased this month based on factory reporting, with lower output in Florida and Puerto Rico more than offsetting an increase in Texas. Imports under the TRQ are decreased 177,157 tons to reflect the surrender of Certificates for Quota Eligibility (CQE) in exchange for CCC sugar stocks.

Sugar used in domestic food and beverages is decreased 100,000 tons, based on continued weak deliveries. CCC stocks are lowered 129,000 tons, mostly reflecting the CQE exchange. Forecast ending stocks are 1.617 million tons and the stocks-to-use ratio is 16%, down from 16.9% last month.

                      U.S. Sugar Supply and Use 1-
======================================================================
                        :           :       2001-02      :  2002-03
      Item              : 2000-01   :      Estimates     :Projections
                        :           :   April      May   :    May
======================================================================
                        :           1,000 short tons, raw value
                    :
Beginning stocks 2-     :   2,219       2,194     2,194       1,617
Production 2-3-         :   8,674       8,030     8,004       8,750
  Beet sugar            :   4,592       4,000     4,000       4,500
  Cane sugar 4-         :   4,082       4,030     4,004       4,250
Imports 2-              :   1,574       1,706     1,529          NA
  TRQ 5-                :   1,260       1,356     1,179          NA
  Other program 6-      :     238         260       260         260
  Non-program 7-        :      76          90        90          60
   Total supply         :  12,467      11,930    11,727          NA
                        :
Exports 2-8-            :     141         125       125         125
Domestic deliveries 2-  :  10,130      10,085     9,985      10,085
  Domestic food use     :   9,998       9,900     9,800       9,900
  Other 9-              :     132         185       185         185
Miscellaneous 10-       :       1           0         0           0
     Use, total         :  10,272      10,210    10,110      10,210
Ending stocks 2-        :   2,194       1,720     1,617          NA
  Private               :   1,410       1,314     1,340          NA
  Other 11-             :     784         406       277          NA
                        :
Stocks to use ratio     :    21.4        16.9      16.0          NA
======================================================================
1- Fiscal years beginning Oct 1.  Includes Puerto Rico.  2- Historical
data are from FSA, "Sweetener Market Data" except imports from U.S.
Customs Service.  3- Projections for 2002-03 are based on analyses by
the Interagency Commodity Estimates Committee for sugar. 4- Production
by state for 2001-02 (projected 2002-03): FL 1,985 (2,100); HI 270
(270); LA 1,575 (1,700); TX 172 (175); PR 2 (5).  5- Actual arrivals
under the tariff rate quota (TRQ) with late entries, early entries,
and TRQ overfills assigned to the fiscal year in which they actually
arrived.  The 2001-02 available TRQs assume shortfall of 50,000 tons.
6- Includes sugar under the re-export and polyhydric alcohol programs.
7- Includes high-tier and other.  8- Mostly reexports. 9- Transfer to
sugar-containing products for reexport and for nonedible alcohol and
feed.  10- For 2000-2001, includes Commodity Credit Corporation sales
to ethanol producers and residual statistical discrepancies.  11- For
2001-02, includes sugar owned by the CCC as of May 8, 2002.  Season-ending
stocks will be a function of market and program developments.