SunSirs: Expectations of Increased Production Strengthen, China Sugar Prices Fall

According to the monitoring of the commodity market analysis system of SunSirs, the average price of first grade white sugar in China was 6,410 RMB/ton at the beginning of the week, and 6,390 RMB/ton at the end of the week, with a price drop of 0.31%.

Domestically, the production and sales rate of domestically produced sugar is at a relatively high level during the same period, with low inventory and less sales pressure on sugar factories. In July, the import volume of sugar and syrup increased significantly, and spot pressure has increased. In terms of output, there is a strong expectation of increased production in the new crushing season, but in the medium to long term, there is insufficient driving force for the rise in sugar prices.

The global sugar market has strong expectations for an oversupply of sugar during the new crushing season. According to relevant data from the General Administration of Customs, 420,000 tons of sugar were imported in July, an increase of 279.7% year-on-year. In addition, sugar prices are under pressure due to the approaching start of sugar beet processing in the north. However, Indian sugar mills will be allowed to produce ethanol from sugarcane or reduce sugar production from November 1st. In the medium to long term, Brazil's sugar production during the 2024/2025 crushing season will still be high, and there is still pressure on US sugar.

The domestic sugar market has weak trading, and it is expected that sugar prices will mainly fluctuate and weaken in the short term.

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