In W25 in the sugar landscape, on Monday June 19, sugar futures for July 2023 delivery started the week off at 26.43 cents/lb. On Tuesday, June 20, the July/23 contract dropped to 26.22 cents/lb on the New York Stock Exchange and further decreased on Wednesday by 1.3% to 25.88 cents/lb. Sugar futures closed Thursday, June 22, with another significant drop of 3.40%, trading at 24.97 cents/lb. On Friday, June 23, the decline persisted, with a further decrease of 2.72%, closing the week on 24.29 cents/lb in New York. This drop was attributed to the favorable progress of the sugarcane harvest in Brazil's main sugarcane belt, which lacked rain forecasts until at least July 5th, facilitating the harvesting of raw materials.
Brazil exported 1.285 million mt of sugar and molasses up to the 3rd week of June, generating accumulated revenue of USD 133.57 million. In May, the country exported 2.471 million mt of sugar-related products. Comparatively, in June 2022, Brazil exported 2.338 million mt of products, earning a total revenue of USD 925.09 million. Sugarcane crushing during the period reached 16.1 million mt, surpassing 2022's harvest by 11.2%. Sugar production also saw a YoY increase of 18.6%, with 969 thousand mt produced.
President Jokowi has set new targets for sugar production and self-sufficiency in Indonesia. In addition, Jokowi is also targeting the supply of bioethanol, a biofuel made from sugarcane. According to the USDA, Indonesia's sugar imports in 2022/2023 will reach 5.8 million mt, up from 5.46 million mt in 2021/2022. Indonesia occupies the first position as the largest global sugar importer, followed by China, which is set to import 4.4 million mt in 2022/2023. Indonesia will import around 5.6 million mt of sugar in 2023, including both raw sugar for consumption and refining as well as government-assigned consumption sugar imports.
Egypt has decided to extend its ban on sugar exports for an additional three months, citing the need to meet local market demand despite having a strategic reserve. In W25, sugar prices in Egypt increased to USD 614.97/mt, compared to USD 566.42/mt at the beginning of June. The country's domestic sugar consumption is approximately 3 million mt, with production reaching around 2.3 million mt. To bridge the gap between production and consumption, Egypt imports approximately 700 thousand mt of sugar from abroad.
In the US industrial and retail sugar consumers have faced historically high prices since the onset of the pandemic in 2020. Sugar prices have surged by nearly 70% since the start of 2020, reaching an all-time high of 43.5 cents/lb in mid-April this year. These price increases are primarily attributed to supply chain issues and declining output. The USDA may adjust its forecast downwards for domestic sugar demand due to market developments.
Lastly, sugarcane farmers in Kenya are urging the government to establish a pricing committee to benefit from the significant rise in sugar prices. Despite the increase in sugar prices, cane prices have remained stagnant since August 2022. The proposed committee would review prices every three months, with the last review conducted by a nine-member interim team approving a price of USD 32.64/mt.
