ASHEVILLE, N.C. — The U.S. Department of Agriculture intends to maintain the U.S. sugar supply within its recent target range, said Bill Northey, U.S.D.A. undersecretary, farm production and conservation, at the annual International Sweetener Symposium held Aug. 5 in Asheville.
“It’s our desire to stay within a 13.5% to 15.5% stocks-to-use ratio,” Mr. Northey said, indicating supply within that range will maintain a “steady, solid market.”
The U.S.D.A. and other government agencies initiated actions to increase U.S. sugar imports (by reallocating some tariff rate quotas and by increasing Mexico’s export limit to the United States) and to reassign domestic sugar marketing allotments earlier this summer to boost the stocks-to-use ratio to 14.3% in the July World Agricultural Supply and Demand Estimates report from 12.4% in the June report. The actions occurred in a timely manner for 2018-19 (the current marketing year that ends Sept. 30) and set up the market “to be in a good place” for 2019-20, Mr. Northey said.
Meanwhile, sugar use was the focus of a presentation by Michael McConnell, agricultural economist, Sugar and Sweeteners Market Outlook, Economic Research Service, of the U.S.D.A., who said the growth in sugar use has been “trickling down” the past couple of years.
“Sugar deliveries still were increasing, but at a declining rate,” Mr. McConnell said, with recent growth at about 0.5% annually.
He noted that demand for sugar was inelastic — not depending on price or consumer income. However, he said consumer tastes, preferences and dietary concerns were having an impact, especially as they related to food manufacturers’ objectives to change formulations to meet consumer preferences, including labeling.
Mr. McConnell also said the import and export of sugar-containing products has had an effect on deliveries, with larger net imports, adding that estimating actual sugar in such imports and exports was difficult.
He cited recent U.S.D.A. data that showed an annual 0.57% decline in total caloric sweetener deliveries over the latest three-year period, compared with an annual decline of 0.07% over the past 15 years. Refined sugar deliveries were up 0.4% annually over the past three years compared with an annual increase of 1.58% over the past 15 years. And, high-fructose corn syrup deliveries declined 3.43% annually in the past three years and fell 2.38% annually over the 15-year period. The U.S. population, meanwhile, increased 0.66% annually over the past three years and increased 0.8% annually over the past 15 years.
Short-term growth in the delivery of sugar has remained positive (albeit by a small amount) and has outperformed HFCS and the overall sweetener market, particularly in the 10-year to 15-year period, Mr. McConnell said.
“In more recent years, average growth rates for total deliveries of sugar have fallen and now lag behind population growth; hence, the reduction in per capita deliveries,” he said in the July Sugar and Sweeteners Outlook report.