Sugar prices are expected to fall further in 2007, according to the International Sugar Organization’s monthly market report on the world sugar market. However, it said sugar commodities in January were in line with expectations.
The report said that world raw sugar prices were expected to continue to fall because of a global glut in 2006/07. The price decreased from 11.42 cents/lb at the beginning of the month to a four-month low of 10.66 cents/lb on 30 January. The monthly average was 10.95 cents/lb, the lowest monthly average since September 2005, according to the report.
White sugar values in the second half of the month partly recovered and consolidated at around 15 cents/lb, which resulted in a monthly average of 14.96 cents/lb, down 5% from the previous month.
The report said that, in 2007, sugar output in India, the world’s second-largest producer, will hit a new record high and that India alone is providing world production with an additional two to three million tonnes.
Sugar production is also expected to grow in Thailand, according to the Thai Sugar Millers Group. China, the world’s third-largest producer, is also heading to a record crop of above 11 million tonnes, compared to less than nine million in the previous season.
Brazil’s exports have slowed down, but still remained significantly higher than in the previous crop year and Australia’s raw cane sugar industry is struggling to make a recovery from cyclone and flood damage.