Dry weather conditions have resulted in one of the earliest finishes to the crushing season for the Australian sugar industry for several years
More than 76 per cent of this year’s sugarcane has already been processed into raw sugar and 33 million tonnes have been forecast to be produced for 2018.
Australian Sugar Milling Council chief executive officer David Pietsch said that the majority of cane could well be harvested well before the end of November due to sugarcane crops drying out quickly.
“The season started back in late May when the first mill started to crush. As soon as all 24 Australian mills were up and running in late June, total sugarcane throughput stayed on or around 1.5 million tonnes of cane crushed each week,” Mr Pietsch said.
“Throughput will tail off as mills in different regions complete their crush”.
The current production forecasts for 2018 are more than one million tonnes down from the starting estimate of 34.3 million tonnes for total cane harvested.
While estimates for production are slightly down, sugar content in the cane has been high with the raw sugar produced likely ranging between 4.2MT to 4.6MT.
For 2017, 33.3 MT of cane was crushed and 4.48 MT of raw sugar was produced of which 3.7 MT was exported.
Mr Pietsch said that the global surplus of sugar created by government subsidies provided to Indian growers has significantly impacted the global market.
“High global inventory stocks coupled with a huge volumes of subsidised sugar, mainly originating from India and Pakistan, are dragging export prices for raw sugar down to levels not seen in over a decade,” he said.
As of Friday, Sugarcane prices rallied overnight to sit at $12.92 US c/Ib which is a positive change of 0.07 per cent.
“Prices have rallied over recent days and long-term global demand for raw sugar continues to be strong, but the low prices are below the cost of production for the Australian industry,” he said.
“Most industry analysts suggest a sustained price recovery is unlikely in the short term,” he said.