Dive Brief
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Stronger imports of sugar have offset domestic production slowdowns, the U.S. Department of Agriculture said this week.
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The agency raised supply by 82,000 short tons, raw value (STRV) from last month, driven by higher tariff-rate quota and high-duty imports. Meanwhile, domestic production declined on reduced beet sugar and Florida cane sugar numbers, according to July’s Sugar and Sweeteners outlook.
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Hurricanes last year slowed Florida’s sugar harvest for months, which led processors to extend their deadlines for farmers. The Office of the U.S. Trade Representative earlier this week increased sugar import allocations to compensate for a lack of production.
Dive Insight
U.S. sugar production can vary widely each year because of weather challenges. Frequent drought conditions, freezes and intense rainfalls are concerns for many Midwest beet sugar producers, while hurricanes can bear nightmarish results for sugarcane growers around the Gulf of Mexico.
Last year, Hurricane Ian dealt more than $1 billion in losses to Florida agriculture producers, according to an impact report from the University of Florida. More than 1 billion acres of field and row crops — including sugarcane — were affected by the storm.
Florida is the largest sugarcane producing region in the U.S., according to the USDA, and has produced an average of 2.06 million STRV in recent years. But weather disruptions pushed back harvest and production times, and processors recently revised their totals downward on lower acreage and recovery rates.
This is the second consecutive year Florida’s production dipped below 2 million STRV since 2015.
U.S. production fell by 56,000 STRV from last month to 9.2 million. According to the USDA, beet sugar production declined due to a reporting technicality. Despite the decline, the agency’s outlook indicated that cane sugar production could be higher than last year and one of the largest totals on record as more data comes in.
While domestic production waned on paper, U.S. sugar supplies increased on higher imports. Total sugar imports for the year increased by 139,000 STRV from last month to 3.5 million.
To help alleviate market conditions and bolster supply, the USTR in March said it would redistribute unused quota allocations for imported raw cane sugar this year. The office made additional allocations on Tuesday.
The National Confectioners Association applauded USTR’s actions earlier this year, saying “this step towards easing the historically tight sugar supply offers an opportunity for a positive outcome for the confectionery industry.”
