The European Commission (EC) today presented the summer edition of its Short-Term Outlook for EU Agricultural Markets.
The EC estimates that EU27 sugar production will decrease by 5% in 2022/23 owing to the recent dry and hot weather. However, due to the increase in production last year 2021/22, EU ending stocks of sugar are expected to recover to 1.9 million tonnes, more than 50% higher than the very low ending stocks last year of 1.2million tonnes.
Facing tough competition from other high-priced arable crops, namely cereals, the EU sugarbeet area in 2022/23 is estimated to decrease by 2.4% compared to the previous season, to 1.45 million hectares. The sowing season this year was favourable with only limited amount of re-sowing needed due to few events of spring frosts. As generally dry conditions during sowing and the early part of the growing season were observed, sugar beet yields are estimated to reach 74.3t/ha (2.6% below the previous season). Under these circumstances, the EU sugarbeet production would reach 108.1 million t in 2022/23, or 5% below the level of 2021/22 (113.8 million t), the EC stated. Likewise, EU sugar production is expected to decrease by 0.85 million tonnes compared with 2020/21, to 15.8million tonnes.
EU human sugar consumption is expected to remain stable in 2022/23, as the number of consumers has increased following the arrival of Ukrainian refugees, and despite a long-term trend of a decreasing per capita consumption due to consumers switching to less sugar intense diets.
But separately, as part of its sugar price reporting system, the EC has reported the quantities of sugar invoiced has been growing, reaching up to 11 million tonnes per annum (presumably not all sugar sales are reported to the Commission – it seems only 70% of such sales are reported to the Commission).
Last year’s EU exports of sugar are forecast to reach 0.9 million tonnes in 2021/22 (+7% year-on-year). Due to higher demand, import levels are also forecast to be up (+8% year-on-year), at 1.4million tonnes.
EU prices have followed the trend of world market prices, albeit at a slower pace, reaching the highest level in the post-production quota era of EUR 452/t in May 2022. As prices for oilseeds and cereals have increased more than the sugar price, sugar has become more competitive as a bioethanol feedstock, hence it is forecast that sugar beet use for bioethanol may grow 8% in 2021/22 compared to last year.
EU isoglucose production is forecast to decrease to around 600 000 tonnes in 2021/22, down 3% from post sugar quota record of 620 000 tonnes in2020/21. Isoglucose production was strong early in the season (late 2021) but due to decreasing price competitiveness with sugar, it was reduced. Consequently, exports have also fallen after a strong start of the season and are not expected to reach 76 000 tonnes, falling short of the record of 88 000tonnes set in 2020/21. Because of lower production, consumption of isoglucose is also expected to decrease by 1% compared to 2020/21. EU isoglucose production, use and exports in 2022/23 is forecast to remain stable.
The full EC report is available here: https://ec.europa.eu/info/sites/default/files/food-farming-fisheries/farming/documents/short-term-outlook-summer-2022_en.pdf