Sugar production for Marketing Year (MY 2013 November-October basis) is forecast at 2.5 million metric tons (MMT).
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE
BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S.
Required Report - public distribution
GAIN Report Number: 12002
Production and Trade
Henry Schmick, Agricultural Counselor
Karla Tay, Agricultural Specialist
Sugar production for Marketing Year (MY 2013 November-October basis) is forecast at 2.5 million
metric tons (MMT). Planted area was increased by 7,000 Hectares (Ha) during the past MY, but
sugar yields have decreased for the last three years. Production for MY 2011 has been revised
downward to 2.0 MMT, 10 percent down from the previous estimate. Production for MY 2012 has
been revised downward to 2.4 MMT, though it is expected to be a record high. Total exports for MY
2013 are forecast at 1.7 MMT, showing a defined trend to maintain exports of refined sugar. Major
export destinations for Guatemalan raw sugar are the United States, South Korea, and Canada. Chile
and Japan are major export markets for refined sugar. Prices at the retail level during the beginning
of FY 2012 averaged $0.49/pound and $0.42/pound at wholesale. During MY2011, Guatemala
positioned itself as the eleventh major producer, fifth major exporter, third most competitive, and
first most efficient at port loading in the global sugar industry.
Sugar production in Guatemala has not grown as expected despite the increases in planted area. In MY
2013, planted area is forecast at 247,000 ha. Sugar yields from cane are forecast to recover to values of
MY 2009. The Guatemalan sugar industry continues to be one of the most efficient in productivity
terms, with 90 metric tons (MT)/ha and port loading capacity of 2,200 MT/hour. Guatemala has the
largest storage capacity in the Central American region (431,000 MT). For MY 2011, Guatemala
ranked eleventh in the list of major sugar producers worldwide, third in exports in Latin America, and
third in competitiveness (utilization/capacity) on a global scale.
Consumption for MY 2013 is placed at 750,000 MT, close to Post’s MY 2012 estimate. Exports for
MY 2013 are forecast at 1.7 million tons. Guatemala is the world’s fifth largest exporter (Guatemalan
exports represent three percent of total world exports) and fourth largest producer in Latin America.
The U.S., South Korea, and Canada continue to be major export markets for raw sugar. The
Guatemalan sugar industry continues moving more into the exportation of refined sugar. Less than 10
years ago, raw sugar exports represented 89 percent of the export market for Guatemala. By CY 2010,
raw sugar exports dropped to 54 percent, while refined sugar experienced a fourfold increase in its
market share, representing 46 percent of the export market. This evolution has increased the importance
of the South American and Caribbean export market for Guatemala, while decreasing significantly
Guatemalan sugar exports to Eastern and Central Europe.
For the MY 2013 crop, sugarcane yields are expected to average close to 90 MT/Ha. The highest
sugarcane yield was reported in MY 2007, when it reached over 94 MT/Ha. The record sugar yield was
reported for MY 2000, 115 Kg/MT. In subsequent years, the sugar yield fell but recovered again in
2009. Since MY2010, sugar yields have been dropping. The Guatemalan sugar industry has attributed
the loss in efficiency to climatic conditions, largely unusual rainy seasons and resulting in decreased
sunlight accumulation. MY 2011 sugar production, impacted by the La Niña phenomenon, experienced
early flowering followed by extended rainfall and decreased sunlight, which resulted in one of the
largest decreases in sugar cane yield. Production dropped 10 percent and the cane harvest ended in
April instead of the normal mid-May end time. However, MY 2012 sugar production is expected to
reach a record high of 2.4 million MT as a result of the El Niño phenomenon which resulted in
decreased cloud cover allowing for more accumulated sunlight in the sugarcane.
The area planted in sugarcane for MY 2013 is forecast at 247,000 ha, up about two percent compared to
2012, and represents three percent of the total country’s surface and 10 percent of the total agricultural
area. Typically, changes in planted area directly respond to sugarcane contracts offered by sugar mills
(based on both domestic and foreign demand). Expansion is limited to a one to two percent growth on a
yearly basis due to a lack of suitable lands, competition from other plantation style crops, and water
Consumption for MY2013 is expected to maintain steady at 750,000 MT as a result of the constant
demand by the local confectionary industry. Per capita consumption of sugar is close to 100 pounds.
Currently, domestic consumption is split 28 percent for industrial and 72 percent for human. The soft
drink industry is the major industrial consumer of sugar, followed by confectioneries, bakeries, juice
makers, dairy producers, and pharmaceutical companies. Overall, domestic consumption is 31-32
percent of the total production.
Alternative sweeteners and other alternative sugar products have not been demonstrated to be significant
factor affecting total domestic sugar consumption.
Export Trade Matrix
Export Trade Matrix
Commodity Centrifugal Sugar
Time period Jan-Dec
U.S. (including re-exports) 322,004 U.S. (including re-exports) 233,229
Mexico 175,483 South Korea 291,566
Canada 169,680 Chile 197,958
Chile 149,425 Canada 132,663
Venezuela 112,387 Russian Federation 71,919
South Korea 107,074 Peru 59,606
Taiwan 90,961 Taiwan 57,383
Indonesia 53,743 Venezuela 56,495
China 52,198 Indonesia 50,920
Trinidad 25,784 Algeria 46,965
Jamaica 18,548 Malaysia 44,830
Malaysia 2,989 Mexico 44,059
Total for others 782,789 Total for others 1,054,364
Others not listed 507,410 Others not listed 257,256
Grand Total 1,612,203 Grand Total 1,544,849
Source: ASAZGUA, 2012
During CY 2011, Guatemala exported almost US$ 650 million in raw and refined sugar, 18 percent less
than CY 2010. Sugar represented the fourth highest source of foreign exchange for the country, after
textiles, coffee, and precious stones and metals. In CY 2011, Guatemala exported 1.5 MMT, 6 percent
less than the previous year, while exports for MY 2012 are forecast at 1.7 MMT. Guatemala continues
exporting around 70 percent of its total production. The United States, South Korea, Canada, and Chile
continue to be major export markets for raw sugar. The Guatemalan sugar industry is attempting to
focus more on exports of refined sugar. In 2010 the Guatemalan sugar industry established an export
warehouse facility in Puerto Quetzal on Guatemala’s South Coast with a capacity of 66,000 MT of 50
kg bags for containerized transportation.
For MY 2011, raw sugar exports represented 55 percent, while refined sugar represented 45 percent of
the exports market. The trend to increase exports of refined sugar has increased the importance of South
American and Caribbean countries for Guatemala’s sugar exports, while decreasing significantly
exports of raw sugar to Eastern and Central Europe.
MY 2013 ending stocks are expected to be similar to those of MY 2012. Domestic stocks are held in
warehouses managed by COMETRO throughout the country. All exported sugar is held in warehouses
managed by EXPOGRANEL, the loading terminal located at Puerto Quetzal. Its warehousing capacity
has increased to 365,000 MT for bulk sugar, and 66,000 MT for refined sugar (50 kg sacks).
Guatemala is known worldwide as a good partner in the sugar business, due to its high quality sugar
(95-98 percent polarization) plus the fact that it has always fulfilled its commitments. Guatemala has
already made contracts for MY 2013. Contracts are usually signed during the first three months of each
calendar year. After March, prices start rising in the international market.
To insure local demand will be supplied, all exports must be managed through the Sugar Producers
Association and a representative from Ministry of Economy has to approve such exports.
Guatemala usually does not experience stocks above normal levels due to exports contacts being
established one year in advance. Below normal stocks have been experienced when production has
been lower than estimated and when contraband shipments move sugar into Mexico and other
neighboring countries. In the case of decreased production, Guatemala faces pressure to comply with its
established export commitments which Guatemala manages by buying out its export contracts based
upon futures market prices. The case of contraband exports have been attributed to high prices of sugar
in Mexico creating a demand for lower-priced Guatemalan sugar. As a result, Guatemalan sugar prices
are monitored and raised at times to decrease the incentive to illegally export sugar to Mexico. During
MY 2010, Guatemala experienced its worst drop in stocks when 780,000 kg (which represents a month
consumption), were the only reported stocks available. The Guatemalan sugar industry reports that the
low stocks were the result of close to 300,000 MT of sugar being legally exported to Mexico between
October 2009 and March 2010, plus an additional 60,000 MT illegally exported to Mexico during the
same time period.
Guatemala has the following quotas in MY 2012 within already implemented Free Trade Agreements:
U.S.: 77,404 MT (WTO) + 38,480 MT (CAFTA-DR)
Taiwan: 76,395 MT (varies as a function of Taiwan’s imports)
The following quotas (on raw values) are to be implemented as soon as the Free Trade Agreements
enter into force:
EU: 65,000 MT
Ecuador: 21,000 MT
The Sugar Board of Guatemala, which includes representatives from the Ministry of Economy,
sugarcane producers, and sugar mills, establishes production goals, sets sugarcane prices, and allocates
the U.S. sugar quota to the different sugar mills. The allocation to each mill is based on past production
performance, previous quotas, and milling capacity. According to the law, all sugar sold domestically
must be enriched with vitamin A. The industry claims to invest more than $3.5 million a year in vitamin
A. At times the Government of Guatemala (GOG) opens most favored nation quotas for imported sugar
to try to control market prices, but the quotas rarely get filled in part due the vitamin A fortification
requirement. During CY 2011 a 50,000 MT sugar quota within WTO was opened, but was never filled.
All imports are assessed a tariff of 20 percent, in addition to a 12 percent value added tax, and must
comply with the enrichment law. When quotas are opened, the 20 percent tariff is eliminated.
Marketing:ASAZGUA is continuing its marketing strategy designed to maintain domestic sugar
consumption. Both by radio and visual media, the sugar industry has been successfully promoting the
fact that natural sugar contains “just 16 calories per teaspoon,” plus the number of direct and indirect
jobs it generates. The main export strategy is geared to increase refined sugar exports.
Production, Supply and Demand Data Statistics:
PS&D for 2011-2013
Sugar, Centrifugal Guatemala 2010/2011 2011/2012 2012/2013
Market Year Begin: Nov 2010 Market Year Begin: Nov 2011 Market Year Begin: Nov 2012
USDA Official New Post USDA Official New Post USDA Official New Post
Beginning Stocks 382 382 93 127 95
Beet Sugar Production 0 0 0 0 0
Cane Sugar Production 2,259 2,048 2,474 2,402 2,474
Total Sugar Production 2,259 2,048 2,474 2,402 2,474
Raw Imports 0 0 0 0 0
Refined Imp.(Raw Val) 0 0 0 0 0
Total Imports 0 0 0 0 0
Total Supply 2,641 2,430 2,567 2,529 2,569
Raw Exports 970 975 970 975 975
Refined Exp.(Raw Val) 838 569 838 700 750
Total Exports 1,808 1,544 1,808 1,675 1,725
Human Dom. Consumption 740 759 740 759 750
Other Disappearance 0 0 0 0 0
Total Use 740 759 740 759 750
Ending Stocks 93 127 19 95 94
Total Distribution 2,641 2,430 2,567 2,529 2,569