US sugar prices seen weakening from peak levels, analysts say
NEW YORK, June 15 (Reuters) – There are indications that sugar prices in the United States could start to fall from the elevated levels of the last three years, analysts said, although better weather is needed to avoid any problems with local production.
U.S. sugar users, both industrial and retail, have been dealing with historically high prices since the beginning of the pandemic in 2020.
Prices rose nearly 70% from early 2020 to an all-time high of 43.50 cents per pound in mid-April this year SFSc1, due mostly to tight availability linked to supply chain issues and lower production.
Analysts point to supply side improvements for both sugar and alternative sweetener corn syrup, while demand has softened.
“Retail prices remain stubbornly high while wholesale prices have begun to ease,” said soft commodities analyst Judith Ganes, president of J. Ganes Consulting, LLC, in a report for Sugaronline.
Sosland Publishing said in a weekly sugar report that “talk about slow sugar and corn sweetener deliveries became more prominent” in the market, adding that purchasing managers expect weakness in the spot price to develop.
It said that there was more availability of sugar and corn syrup on the spot market due to slower-than-expected demand.
Ganes said the U.S. Department of Agriculture (USDA) could adjust downwards its projection for sugar demand in the country due to market developments.
“Given the known slowed sales volumes based on units sold and shrinkage in packaging, I would have to believe that it may be difficult to sustain the (USDA) sugar use figure and revisions could occur later,” she said.
Analysts, however, said that rain is needed in the U.S. sugar beet areas. Problems in local production could prevent prices from falling, they said.
Source Link :- https://www.nasdaq.com/articles/us-sugar-prices-seen-weakening-from-peak-levels-analysts-say
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