Love, John M.

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Research Papers in Economics

Agricultural Outlook Forum 2004    Presented: Friday, February 20, 
2004 
 
2004/05 U.S. SUGAR SUPPLY AND USE
1 
 
John M. Love 
USDA World Agricultural Outlook Board 
 
The 2004/05 projections use the baseline, published in USDA Agricultural Baseline Projections to 2013, 
updated with carry-in stocks from the February 2004 World Agricultural Supply And Demand Estimates. 
 
Key assumptions behind the sugar baseline: 
 
$  Continuation of current U.S. sugar policy. 
  --Loan program includes loan rates and non-recourse loans. 
  --Tariff-rate quota imports stay under current system. 
  --U.S. honors commitments under trade agreements. 
  --Commodity Credit Corporation disposes of any forfeited sugar. 
 
$  Continued trends in factors of production. 
  --Technology increases crop yields and sugar recovery rates. 
  --Alternative-crop prices decline in fiscal year 2004/05; remain stable to 2013/14. 
 
$  Consumption grows in line with population growth. 
 
$  In Mexico, the tax on soft drinks that use high fructose corn syrup remains in place. 
 
Key results from the baseline, for the period 2004/05 to 2013/14: 
 
$  U.S. sugar-crop prices remain relatively flat, as marketing allotments govern supplies.  Despite 
imports rising to 2.3 million tons by 2013/14, the Overall Allotment Quantity is not reduced and 
thus allotments are not suspended.  Consumption grows at an annual rate of about 100,000 tons.  
Production increases about 45,000 tons annually, mainly in the beet sugar sector. 
 
Key results from the 2004/05 projections: 
 
$  Total production for fiscal year 2004/05, at 8.4 million short tons (raw value),  is 580,000 tons 
below 2003/04, mainly due to lower sugarcane area and a return to average sugarbeet quality after 
exceptional sugar recovery from 2003-crop sugarbeets. 
 
$  Inventory and sales projections for 2004/05 are not adjusted from reported extraordinary refined 
sugar sales during September 2002 and 2003. 
 
  --The higher September sales reduced reported year-ending stocks. 
 
  --Total ending stocks for 2004/05 are projected at 2.3 million tons. 
                                                 
 
1Approved by the World Agricultural Outlook Board.  
 
       2004 USDA Agricultural Outlook Forum, Sweeteners Session 
                            February 20, 2004 
                   
                      U.S. Sugar Supply and Use 1/ 
====================================================================== 
                        :           :       2003/04      :  2004/05 
      Item              : 2002/03   :====================:============ 
                        :           : January   February : Projection 
====================================================================== 
                        :           1,000 short tons, raw value 
    :  
Beginning stocks        :   1,419       1,304     1,259       1,938 
Production 2/           :   8,380       8,948     8,930       8,365 
  Beet sugar            :   4,415       4,852     4,824       4,438 
  Cane sugar 3/         :   3,965       4,096     4,106       3,927 
Imports                 :   1,732       1,584     1,584       1,774 
  TRQ 4/                :   1,212       1,224     1,224       1,224 
  Other program 5/      :     488         325       325         300 
  Other 6/              :      32          35        35         250 
   Total supply         :  11,531      11,836    11,773      12,077 
                        : 
Exports 7/              :     142         160       160         150 
Sales for dom. use 8/   :   9,975       9,675     9,675       9,595 
  Food                  :   9,767       9,450     9,465       9,415 
  Other 9/              :     208         225       210         180 
Miscellaneous 10/       :     155           0         0           0 
     Use, total         :  10,272       9,835     9,835       9,745 
Ending stocks           :   1,259       2,001     1,938       2,332                       
: 
Stocks to use ratio     :    12.3        20.3      19.7        23.9 
====================================================================== 
1/ Fiscal years beginning Oct 1.  Includes Puerto Rico.  Historical  
data are from FSA, "Sweetener Market Data" except imports from U.S.  
Customs Service.  2/ Projections for 2004/05 are based on the USDA  
Agricultural Baseline Projections to 2013, updated with beginning  
stocks from the February 2004 WASDE.  3/ Production by state for  
2003/04 (projected 2004/05): FL 2,166 (2,019); HI 276 (247); LA  
1,472 (1,499); TX 182 (162); PR 0 (0).  4/ Actual arrivals under the  
tariff rate quota (TRQ) with late entries, early entries, and TRQ  
overfills assigned to the fiscal year in which they actually arrived.   
The 2004/05 available TRQs assume shortfall of 50,000 tons. 5/  
Includes sugar under the re-export and polyhydric alcohol programs.  
6/ Includes high-tier and other.  7/ Mostly reexports. 8/ Inicates  
change of ownership, not necessarily delivery.  For 2004/05,  
delivered sales.  9/ Transfers to sugar-containing products for  
reexport, and for nonedible alcohol and feed.  10/ Residual  
statistical discrepancies. 

2004/05 U.S. SUGAR SUPPLY AND USE

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