Farm Progress America, April 24, 2024

Source: Farm Progress. The original article is posted here.

Farm Progress America, April 24, 2024

Mike Pearson takes a look at the sugar industry and what's ahead for sugar growers.

2023 was a year of price rallies, as global sugar production suffered a series of issues that cramped output. Droughts in Asia cut cane production and heavy rain in Europe flooded sugar beet fields. By November 2023, Sugar Futures hit a 12 year high on those fears. But by mid-December, prices had collapsed as Brazilian production surged.

Since then, the breakdown in price continues as early forecasts called for massive production everywhere. Domestically, the USDA had forecasted a record-breaking sugar crop for the 2023-24 growing season which had weighed in on prices.

Since then, the threat of the record crop was tempered by early season weather.

According to a recent report from Southern AG Today, two professors say unseasonably warm weather in the Midwest could propose a problem for sugar beet growers, while the ongoing severe drought in Louisiana and Texas will take a toll on cane production. In the north, the early season warmth caused significant spoilage in beet piles with beet shrink rising from 7 1/2% to 9% in March.

Leading the way for the USDA to drop production by a million and a quarter pounds. Cane growers have a tale of two crops. Total production is still slated for 4 million tonnes, the highest since the 2020 marketing season. But the big production is coming out of Florida and some resilient areas in Louisiana.

While Texas producers are faced with a long running drought. They expect their crop to continue to shrink. Current estimates out of Texas is for 40 million tons in 2024, compared to 180 million tons just seven years ago with those issues factored into current production. The total U.S. sugar production is expected to come in at 9.24 million tons which would be the third largest sugar crop in history.

According to experts at Southern AG today, despite crippling input costs that are 3 percent higher than in 2018. Producers are still expected to produce 10 million tons of sugar this year, making the USA the fifth largest producer in the world.

Farm Progress America is a daily look at key issues in agriculture. It is produced and presented by Mike Pearson, farm broadcaster and host of This Week in Agribusiness .

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