- Cuts ‘10/11 deficit forecast due strong Thai output
- Sees prospect that depleted global stocks will rise
- Sees lobal sugar consumption up 2 pct in 2012
LONDON, June 3 (Reuters) - Czarnikow on Friday forecast a global sugar surplus of 10.3 million tonnes in 2011/12, as growers increase plantings to take advantage of high prices, after a small deficit of 0.5 million tonnes in 2010/11.
“The 2011/12 season should deliver a sharp rise in global production as producers around the world respond to high sugar prices,” the London-based merchant said.
“This should see the global balance return to surplus following three years of declining stocks.”
Global sugar production is forecast to rise 14.2 million tonnes during the 2011/12 season, the merchant said in its latest monthly report. Czarnikow uses an aggregate of crop years in its production forecasts.
“The larger size of the surplus and the broad spread of countries in which production is expected to grow significantly, strengthens the prospect that depleted global stocks will rise,” Czarnikow said.
During 2011/12, cane sugar production is expected to rise to a record 145.4 million tonnes from 135.8 million tonnes in 2010/11, while beet sugar output is expected to rise to a five-year high of 36.8 million tonnes, up 4.6 million.
“Our current estimate of production in the 2011/12 cycle represents the concerted effort of nearly all producing countries to maximise production,” said Toby Cohen, Czarnikow director.
Sugar consumption is expected to grow in 2012 by 2 percent after three years of average annual growth of 1.1 percent, Czarnikow said.
“This higher forecast growth rate is in part reflective of the expected increase in supply, which should reduce domestic price volatility,” it said. Czarnikow forecast a 1.7 million tonne increase in the combined total output for the centre-south and north-east regions of Brazil, the world’s top producer, compared with the 5.4 million tonne rise seen last year.
Czarnikow said sugar output this season in India, the world’s number 2 producer after Brazil, will be 26.1 million tonnes, just 0.4 million tonnes below its previous prediction made in February.
“We continue to see prospects for an increase in production in India in the 2011/12 season,” the merchant said.
The 2010/11 Thai cane crush is ongoing, with around 95 million tonnes of cane now processed, representing a 35 percent increase year-on-year.