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Sugar

MarketSituation

AGRI C 5

Management Committee for the Common

Organisation of Agricultural Markets24 May 2012



World Sugar Market



Exchange rates (23/05/2012):Euro – Dollar exchange rate: 1 € = 1.27 $

US Dollar ($) / Brazilian Real (R$): 1 $ = 2.03 R$



Continued price decline

• White sugar (22/05/2012 vs. 02/05/2012)

• August: 555.6 $/t (- 1.1%; 435.2 €/t)

• October: 541.5 $/t (- 2.7%; 424.1 €/t)

• Raw sugar (22/05/2012 vs. 02/05/2012)

• July: 19.80 $cts/lb (- 3.6%; 341.9 €/t)

• October: 20.20 $cts/lb (- 3.8%; 348.8 €/t)

White premium: moved around 115 $/t on Oct/Oct basis (white/raw)



WORLD MARKET

NEWS



International Sugar Organization(ISO)

revised estimates for the 2011/12 world

sugar balance in May 2012

• world sugar surplus revised upwards

to 6.5 mio t ,1.3 mio t more than forecast in February



ISO World sugar balance

(2011/12 estimates - May 2012)

mio t %

Production 164.2 173.8 9.6 5.9%

Consumption 163.6 167.4 3.7 2.3%

Surplus/Deficit 0.6 6.5

Exports 52.8 53.5 0.7 1.41Ending stocks 56.9 58.5 1.6 2.73

Stock/Consumption

ratio in %34.8 34.9

Change(mio t raw value) 2010/11 2011/12



• World sugar production in 2011/12 is expected toreach a new record of nearly 174 mio t, almost 10 mio t

more than last year.

• The main growth comes from beet sugar , which isexpected to increase by 6.4 mio t to 39 mio t, while

cane sugar sees a more modest 3.3 mio t increase tonearly 135 mio t (78% of the total).





• World sugar consumption in 2011/12 has beenadjusted downwards by 0.4 mio t to 167.4 mio t and

remains nearly 4 mio t higher than last year.• Global sugar trade is increased only marginally from

last quarter's forecast, to 53.5 mio t. Most notably, ISOexpects Brazil's exports to fall by 4.2 mio t to under

23 mio t in 2011/12.This should be more than compensated by a growth inexports from Australia, India, Thailand and the EU.





• ISO expects 2011/12 world ending stocks toimprove to 58.5 mio t, 1.6 mio t higher than in 2010/11.

• stock/consumption ratio improves only very slightly,to 34.9





Brazil

• In Brazil , excess rain in the centre-south region isslowing the progress of the cane harvest and could threaten yields if the winter is wet this year, as

expected.• The opposite problem of drought is now afflicting the

north-east of the country, which grows only 10% of Brazil's sugar cane. 90% is grown in the centre-south.



Thailand

• Thailand , has produced a record 10.2 mio t of sugar at the end of its 2011/12 crushing season, up 0.6 mio t from the previous crop of 9.6 mio t.

• After setting aside around 2.4 mio t for domestic consumption a record surplus of 7.8 mio t could beavailable for export.

• Growing demand in Asia is expected to absorb the extra

production.



Ukraine

• Ukraine's white sugar production could fall to about 1.8mio t in 2012/13, down from 2.3 mio t, following a

reduction in the area sown to sugar beet from 0.54 mioha to 0.48 mio ha .



EU Sugar Market



Out-of-quota exports in 2011/12

• Sugar: 1,350,000 t opened

(Reg. 372/2011 as amended by Reg. 1238/2011)

• 700,000 t (1 Dec 2011) – 100% allocated• 650,000 t (1 Jan 2012) – 100% allocated

• Isoglucose: out of the 70,000 t opened 11,280 tor 16.11% committed



Out-of-quota release

• Regulation (EU) No 367/2012 permitted therelease of 250,000 t of out-of-quota sugar and13,000 t of out-of-quota isoglucose at a reducedsurplus levy of EUR 211 per tonne.

• For sugar all quantities were taken andRegulation (EU) N° 397/2012 fixed an allocation

coefficient of 22.007274 %• For isoglucose 3 900 tonnes are taken until now



Industrial TRQ for chemical industry

• For 2011/12, Regulation 380/2011 opened

an import TRQ of 400 000 t sugar for thesupply of the chemical industry (CN 1701)

• 13 980 t (3.5%) has so far been committed



Import tenders

• Regulation (EU) No 356/2012 advanced the datesfor the 3 remaining tenders to:

• 2 May 2012

• 23 May 2012

• 6 June 2012

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