Thailand is forecast to produce approximately 7.8 million tonnes of sugar during the 2010/11 season. Initial forecasts were for 6.8 million tonnes. Crushing will end next month in Thailand, the world’s second largest sugar exporter after Brazil.
A larger crop in Thailand and expected decreased demand from Japan has seen prices drop recently. China and Indonesia may step in to fulfil their buying requirements at such price levels.
Thai whites were offered at a premium $25 above London No. 5 which is down from the recent $40 premium. While Thai raws were offered at a premium of 200 points above New York No. 11 which is down from the recent 280 point premium. Demand seemed to be weak for Thai raws of Japanese specification. Thai premiums may weaken further as a result of the larger than expected crop, weaker demand from Japan and the possibility of Indian exports becoming available.