Sugar exports from Ukraine remain quite high despite low prices

Despite the resumption of sugar exports from Ukraine to the EU, domestic prices remain at a low level of 23-24 UAH/kg under the pressure of the dollar's fall against the hryvnia and a new wave of decline in world prices.

 

Producers are increasing sugar exports, fearing a decline in world prices in the new season due to increased production.

 

In the first 6 months of the 2024/25 MY, Ukraine exported over 403.5 thousand tons of sugar, 98.4% of which to countries outside the EU, the National Association of Sugar Producers of Ukraine (Ukrsugar) reports.

 

The main buyers of Ukrainian sugar during this period were Turkey (18% of total exports), Libya, North Macedonia, Somalia, and Sri Lanka.

 

Since February, Ukraine has resumed sugar exports to the EU, shipping 6,559 thousand tons there, of which 72% were delivered to Bulgaria, 12% each to Greece and Italy.

 

In 2024, Ukrainian sugar producers produced 1.8 million tons of sugar, of which a record 746.3 thousand tons were exported for $419 million. At the same time, the volume of the domestic market in Ukraine is currently estimated at 900 thousand tons per year.

 

In two weeks, sugar exchange prices fell by 4.5-5.5% on forecasts of increased production in Brazil, although the world sugar balance for the 2024/25 MY has worsened.

 

The International Sugar Organization (ISO) on Thursday lowered its forecast for world sugar production in 2024/25 MY compared to November estimates from 179.1 to 175.5 million tons, and increased its forecast for a global sugar deficit from 2.51 to 4.88 million tons, while in 2023/24 MY the world experienced a global sugar surplus of 1.31 million tons.

 

Sugar trader Czarnikow, in a report dated February 27, raised its forecast for sugar production in Brazil in the 2025/26 MY to a record 43.6 million tons, as producing sugar will be more profitable than ethanol.

 

On the London Stock Exchange, May futures for white sugar No. 5 fell by 4.5% in two weeks to $531/t (+3.5% in the month, -1.7% in three months), and for cane sugar No. 11 – by 5.5% to $18.85/lb or $415/t (-3.8% in the month, -13% in three months) against the backdrop of improving weather in Brazil.

 

Green Pool Commodity experts believe that the global sugar market will change from a projected deficit of -3.7 million tons in 2024/25 MY to a surplus of +2.7 million tons in 2025/26 MY.