W15 Sugar Update: China's Surging Sugar Imports and Brazil's Promising Sugarcane Outlook

Published 2024년 4월 17일

In W15 in the sugar landscape, China's sugar import market surged in the early months of 2024. Brazil emerged as the leading supplier, contributing to China's growing imports. In Feb-24, China imported sugar worth USD 307 million, marking a 119% YoY increase, while import volumes rose by 58.8% to 494.9 thousand mt. Meanwhile, recent rainfall in key sugarcane-producing regions in Brazil has improved the outlook for the 2024/25 sugar season, with projections suggesting the potential for the second-highest sugarcane yield in nine years. This has led to estimates of refined sugar production ranging from 42.5 to 44.5 mmt, nearing the record production level of the previous season. However, projections from other traders vary, with some foreseeing lower production due to below-average rainfall during crop development.

China's Sugar Imports Surge in Early 2024

China's sugar import market has exhibited a robust growth trend in the first two months of 2024. The overall increase in import volumes suggest a potential rise in domestic sugar consumption and strategic stockpiling by China. In Feb-24, China's sugar imports reached USD 307 million, representing a substantial 119% year-on-year (YoY) increase. Import volumes also rose significantly, reaching 494.9 thousand metric tons (mt), reflecting a YoY growth of 58.8%. The positive trend continued in the Jan-24 to Feb-24 period. China's total sugar imports amounted to USD 727 million, signifying a YoY increase of 80.5%. Import volumes for the Jan-24 to Feb-24 period reached 1.2 million metric tons (mmt), reflecting a YoY growth of 35.4%.

Brazil emerged as the dominant supplier of sugar imports to China in the first two months of 2024. The import value from Brazil stood at USD 635 million, representing a 113% YoY increase. Feb-24 alone saw an import value of USD 258 million from Brazil, reflecting a YoY surge of 150.23%. Other major suppliers during this period included El Salvador, South Korea, South Africa, Thailand, Malaysia, India, Mauritius, Germany, and Saudi Arabia. Collectively, these ten countries accounted for 50% of China's total sugar import volume.

Rain Offers Respite for Brazilian Sugarcane Crop, Boosting Production Forecasts

Recent rainfall in Brazil's key sugarcane-producing region during late Mar-24 and early Apr-24 has improved the outlook for the 2024/25 sugar season, according to one of the main Asian commodities traders. The Center-South region is anticipated to achieve its second-highest sugarcane yield in the past nine years, driven by the recent precipitation. Based on this improved yield expectation, Brazil's 2024/25 sugarcane crop is projected to fall within a range of 620 to 630 mmt.

Refined sugar production from the crop is estimated to reach 42.5 to 44.5 mmt, with a target crop of 43.8 mmt. This target nearly equals the record production level of the 2023/24 sugar season. While Asian trader projections are on the higher end compared to current market estimates from other traders, a France-based trader forecasts a significantly lower production in Brazil's Center-South region, at around 40 mmt, citing below-average rainfall throughout the crop development stage.