In the spring, the farmers rolled the dice on the green carpet. Beets, sunflowers, corn, barley… Place your bets! Bet your seeds at best. Each year, the wheel of agricultural fortune turns and brings its share of winners and losers. As the plants come out of the ground, the Ministry of Agriculture launched its probe to estimate the stakes. According to data released Wednesday, June 8, the sunflower seems to have turned heads. The beautiful round flower is expected to cover an area of 800,000 hectares, up 14%. A yellow carpet of unprecedented size.
The shortage of sunflower oil on the shelves, sparked by panic buying by consumers worried about a supply disruption following the Russian invasion of Ukraine, producer of half the world’s volumes, inflaming prices, played . In addition, its sobriety has become a key asset when the price of fertilizers explodes. Spring barley is also gaining surface area. Conversely, the sugar beet fields continue to melt. They fell below the 400,000 hectare mark, accumulating an 11% drop over the last five years.
This attrition could continue, according to Gérard Clay, president of the Tereos cooperative, the world’s second largest sugar group, which expects a further decline of 10% by 2024. Planters do not make enough wheat with sugar, say -they. It is true that barley, rapeseed, sunflower are trading at gold prices. However, since the crisis, in 2019, when the remuneration for beets sank to 22.30 euros per ton, the price of the root has risen to exceed 28 euros per ton in 2021. It could even be traded at more of 30 euros in the next harvest.
Sweet juice
Financial investors have, in fact, for two years, regained their appetite for sugar, even if it does not crystallize attention. In New York, the pound of raw sugar is trading at almost 19 cents, when it was close to 10 cents in the midst of a depression. “This market is not at the heart of the news, because it does not depend on Russia and Ukraine, even if these two countries are large producers of beet sugar for their own needs”, says François Thaury , director of the sugar market at Agritel, who adds: “The real reason for the rebound in the price is related to ethanol and the increase in fuel prices. “Black gold and white powder…
All eyes turn to Brazil. The world’s leading producer and exporter, where the cane harvest began in April, can press the sugar or ethanol button at any time to make the most of the sweet juice. “In 2021, the ratio was 45% sugar and 55% ethanol. But one point more ethanol corresponds to 700,000 tonnes less sugar,” explains Mr. Thaury. Uncertainty about the weight of sugar in the scale creates tensions. The same applies when countries limit their exports. In India, orders have been given to cap exports, but at a record level of 10 million tonnes. Algeria has also closed the airlock. When sugar stocks no longer flow…
