SunSirs: Supply Rebounds, China Sugar Prices Declines

According to the monitoring of the commodity market analysis system of SunSirs, the average price of domestic first grade white sugar at the beginning of the week was 6,868 RMB/ton, and the average price of domestic first grade white sugar on the weekend was 6,710 RMB/ton, a decrease of 2.30% in price and an increase of 16.57% compared to the same period last year.

Sugar is in a period of concentrated squeezing, with supply rebounding and traders maintaining low inventory levels. The market's willingness to replenish goods is not high, and the end market is seeking low-priced transactions. There is a demand for replenishment during the Spring Festival in end consumption, which may support sugar prices. The Ministry of Agriculture and Rural Affairs of China predicts that the domestic sugar production during the 2023/2024 squeezing season will increase by 1.03 million to 10 million tons, with domestic consumption of approximately 15.7 million tons. The gap between production and demand during the new squeezing season in China will decrease year-on-year.

The latest data from the Indian Sugar Factory Association and the National Sugar Federation of India shows that sugar production in India has continued to decline, with a possible decrease of up to 10.7% compared to the same period last year as of December 15th. According to data from the Indian Sugar Factory Association, as of December 15th, the sugar production during the 2023/2024 crushing season in India was around 7.4 million tons, while the National Sugar Federation's crushing report showed a year-on-year decrease of 9.2% in sugar production to 7.43 million tons.

New sugar is concentrated on the market, with sufficient supply in the market. It is expected that the price of white sugar will mainly fluctuate weakly in the short term.

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