The main reasons for the deterioration in the global balance are unfavourable weather conditions and a decline in production in the major sugar-producing regions, particularly Brazil, India and the European Union. The El Niño weather phenomenon is having an additional negative impact on crop yields, causing abnormal rainfall and droughts in various regions around the world. This forecast was published by the analytical firm Green Pool Commodities.
The situation in Brazil, which remains the world’s leading sugar exporter, is causing the greatest concern. At the end of September, processing volumes were once again below normal levels, with sugar production 14 per cent lower than in the same period last year. As a result, Green Pool has lowered its forecast for sugar production in Brazil’s central-southern region by 600,000 tonnes to 37.3 million tonnes.
In the European Union, sugar production is also set to fall due to adverse weather conditions (the summer drought). The expected production volume has been reduced by 228,000 tonnes to 12.44 million tonnes. However, Green Pool does not rule out a further downgrade of its forecasts, which could heighten tensions in the European sugar market and affect the region’s demand for imported sugar.
The downgraded forecasts have already affected global sugar prices. Last week, raw sugar prices reached 21.29 cents per pound, the highest level in the last 19 months. A widening global deficit could keep prices high on the international market and intensify competition amongst importers for available sugar supplies.
This story was translated with the assistance of artificial intelligence.The translation was also reviewed by the Logos Press editorial team.
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