National sugar production is 5.34 million tons of sugar

Weekly sugar report

The new data implies a harvest of 718,000 hectares, almost 48,000 hectares more than the 670,500 of the previous harvest. Harvested area will grow by 7.12%

· This harvest is betting on an improved harvested area

· Second 150,000 ton sugar quota auctioned

· Five mills have now started producing

· More sugar in local markets; prices dropping

This harvest is betting on an improved harvested area

Based on the data disclosed last week by the National Committee for the Sustainable Development of Sugar Cane (CONADESUCA), mills are expecting a better harvest as a result of increased harvested area

National sugar production, based on the accumulated data from mills, the sum of the sugar chamber, ANEA and independents, is 5.34 million tons of sugar. The final harvest is expected to increase by 3% over the 5.18 million tons produced in the 2010/2011 cycle.

The new data implies a harvest of 718,000 hectares, almost 48,000 hectares more than the 670,500 of the previous harvest. Harvested area will grow by 7.12%.

The better harvest expected by industrialists and cane committees throughout the country should be a result of more crushed cane and not improved factory or field yields. The estimates are for a total of 45.93 million tons, which is 4.1% higher than the 44.13 million tons of the 2010/2011 crushing.

Second 150,000 ton sugar quota auctioned

Subsequent to the publication of the rules for the tender process, on 16 November the Economy Ministry auctioned the second import quota in 2011 for 150,000 tons of sugar. The Economy Ministry’s Integrated Information System for Foreign Trade (SIICEX) announced the deadline to be 31 January 2012.

According to the tenders, authorities expect the winners to complete the procedures and pay for the rights awarded them. According to the final agreement, the trading companies must pay the federal government between 440 and 670 pesos for each ton of sugar that they import.

Given that the object of the quotas was mainly to increase domestic supply, the companies that use the sugar in their productive processes will have the advantage of paying rights to import sugar for 180 to 400 pesos per ton.

Five mills have now started producing

In anticipation of information from the four mills that have started producing, at the end of the second week of the harvest at 12 November, the Aaron Saenz mill in Tamaulipas in north-east Mexico has reported a harvested area of 868 hectares, 74,532 tons of gross crushed cane and a sugar production of 6,158 tons.

More sugar in local markets; prices dropping

In the week of 14 to 18 November, the price trend continued on a downward path as a result of more sugar being imported and the start of the harvest in Mexico.

A bulk of standard sugar on a national level averaged 710 pesos, 30 pesos less than registered mid-October while a 50 kg bulk of refined retailed 769 pesos, 12 pesos less than last month.

In percentage terms, a bulk of standard sugar dropped 4% and refined 1.5% compared to the previous month.

18 November

The price of standard sugar at the five main supply centers in Mexico (Mexico City, Guadalajara, Toluca, Puebla and San Nicolas in Monterrey) is 701 pesos for a 50 kg bulk and the price of refined is 747 pesos retail.

WHOLESALE PRICES (pesos per 50 kg bulk)

STANDARD: Mexico City 665, Guadalajara 678, Monterrey 675

REFINED: Mexico City 690, Guadalajara 690, Monterrey 690

Bank of Mexico exchange rate: 13.7033 pesos per US dollar