Troubled sugar market seen facing threat of a revitalized rival -Cuba
Troubled sugar market seen facing threat of a revitalized rival: Cuba
By Reuters Media on Sep 12, 2015 at 5:45 p.m.
MIAMI, Sept 11 (Reuters) – As if bearish market conditions weren’t bad
enough, sugar producers in top growers Brazil, Thailand and India may
soon have to face heftier competition in an already crowded field from
an old rival: Cuba.
Cuba’s annual sugar exports could nearly double to almost 2.5 million
tonnes by 2020, said an agriculture analyst with Platts on Friday, as
the country rebuilds a struggling cane industry and moves to reclaim at
least a portion of its sugar legacy.
The country’s output may swell to 3 million tonnes, said Maria Nunez, an
agriculture analyst with Platts at a sugar conference in Miami, marking
the return to of Cuba’s presence as a significant world supplier.
Cuba was once the world’s largest exporter. Production has tumbled from
a peak of over 8 million tonnes in 1990, to just about 1.9 million
tonnes in the 2014/15 crop year. In recent years, the country launched
an initiative to rebuild its cane industry.
Cuba’s sugar footprint has been dwarfed by new entrants, most notably
top producer and exporter Brazil where production is over 30 million tonnes.
The country may face tough conditions. The world’s sugar farmers and
millers are struggling with prices near seven-year lows as consumers
wade through excess supplies built up during five straight years of surplus.
Nearby United States, Canada, and Haiti would be the most likely
destinations for output that could swell to 3 million tonnes by 2020,
based on the current pace of growth, said Maria Nunez of Platts at a
sugar conference in Miami.
That would be just a sliver of Cuba’s peak production of over 8 million
tonnes in 1990, but would be up from 2014/15’s 11-year high of 1.9
million tonnes as the country rebuilds its cane sector.
Renewed trade ties would make the U.S. market a likely export outlet,
The United States and Cuba restored diplomatic ties in July after a
Still, Nunez cautioned that regaining an import quota could prove tricky
and slow, making Haiti and Venezuela more likely to be key growth
markets in the short-term.
Cuba shipped 1.3 million tonnes of exports to destinations including
China, Russia, Lebanon, the European Union, and Haiti in 2014/15, Nunez
“They need to boost exports in the Americas,” she said.
Source: Troubled sugar market seen facing threat of a revitalized rival:
Cuba | Grand Forks Herald –