Show I THE SUGAR SITUATION I By GEORGE E. E E ROBERTS I F From ro the Monthly Bank Letter for June Issued Leter I by The Te National City Bank of New York In 1923 the te price fluctuations o of sugar were relatively wid wide ranging from cents for Cuban raws duty duty duty du du- du- du ty paid in January Januar to 81 cents on April Apri The advance was caused by a drought in Cuba which reduced re xe- the cane yield from early es estimates estimates es- es of or 4 tons to an actual yield of tons As th the effects of the drought drought- d de developed developed de- de buyers bid bd tl tip up the te price as they are very ap apt to do with the price of anything the supply of which seems likely to be short short As prices pries rose considerable le excitement excitement excite excite- ment developed and government officials of of- of-I of undertook to enjoin the sugar exchange and indict traders for conspiracy but these proceedings ultimately came caine to nothing However the high prices pries which ruled on that crop had economic re re- re- re suits They stimulated beet sugar producers to plant increased acreage acre acreage acreage acre acre- age in the Spring of 1924 so that the worlds world's worl's 1925 1924 beet crop has amounted to long tons according to Will Vi Willett tt Grays Gray's figures figures fig fig- fg- fg ures as compared with long tons in the previous crop year an increase of long tons I Cane Can production does not in genera general general gen gen- era eral respond as rapidly to the price prie stimulus as beet production because because because be be- cause cause of the necessity for planting so far ahead of time of harvest N Nevertheless the worlds world's words word's cane crop also shows an increase over last year of tons The latest estimates of the Cuban cane cne crop vary var between tons Guma- Guma Mejer and Himely as compared with a crop of long tons last year In response to prospects in the latter later part of 1924 for large production production production pro pro- everywhere the price of raw sugar fell eU from rom 65 cents duty paid at New York on December 1924 to cents on December December December Decem Decem- ber The maximum fluctuations during the first five months of this year from from this price have been about third one-third of a cent above and one-fourth one of a cent be be- low In this striking fashion have DOMESTIC CANE PRODUCTION Long Tons Hawaiian TT crop less local consumption Virgin Islands less local consumption Philippine Is Isi available for U. U Philppine I export to S. S S.- S. M Porto Rico less local consumption Louisiana less local local- consumption Total raw cane supplies Figures Figure from Fact Facts About Sugar and anti Willett Wiett Gray Cray the high prices of 1923 cured them them- selves Low Prices Stimulate Consumption This however is not the only Jesson Jesson jesson Jes- Jes son in economics taught by the big sugar crop Lower Dower prices have in increased increased increased in- in creased consumption Reliable in information information information in- in formation from Europe is to 10 the effect that although production forthe forthe for forthe the five principal exporting countries countries coun coun- tries tres of Europe Germany CzechoSlovakia Czechoslovakia Czecho Czecho- Czecho slovakia Belgium Holland Holand Poland increased tons over l last st year stocks in those countries on April Apri first were only tons in excess of last year at the corresponding corresponding corre corre- date In comparing the ithe Cuban add European situation it must be borne borne in mind that the European beet crop was was was' practically practically cally caly made by the end of January Januar and supplies have been disappearing since then while the Cuban season is just now closing cosing and its production production tion will wi be the main supply of this country to the end oi oL of this year N Nevertheless with production to toMay fay May 15 about tons larger than to that date last year stocks at ports and plantations were Only tons larger indicating that the rapid movement of the European European European Euro Euro- crop has not meant any any curtailment curtailment cur cur- of the demands on on Cuba These figures show that the disappearance disappearance disappearance dis dis- dis- dis appearance of sugar to May 15 was wa even more than proportionate to the increased production Disappearance however is not the same as consumption The sugar has gone to the trade but there remains the question whether stocks in the trade are greater than tan normal normal It I is known that the general trade policy in all al lines of lat late has been to carry no lager larger stocks than are are necessary and in view of the gener general general gen gen- er eral l tendency of sugar prices downward downward downward down down- ward since last December it seems probable that this has been the policy of sugar dealers So far as information is available it supports this view In this country countr with the season of largest demand in immediate prospect invisible stocks are re reported reported reported re- re ported as low although the distribution distribution distri distri- from cane refineries and beet sugar mills mis for fer the first quarter of the the year exceeded last years year's distribution distribution dis dis- dis- dis n by tons an n in increase increase in- in crease of 87 87 per cent cent U U. S S. Sugar Suga Budget for 1925 Bec Because use of f the the- the the present present relatively low price prie of sugar and the relatively relatively relatively rela rela- high tariff of 22 cents per pound on all aU foreign O egl raw sugars except Cuban raws jt it is clear that receipts of full ful duty sugars cear will wil be beas beas beas as small this tiis year as as in other years of l low w prices In analyzing the sugar of the United States f for 1225 1925 it is therefore only necessary necessary necessary sary to consider our usual sources of supply The carry carryover over of United States beet sugar at the beginning of the year is is estimated at tons raw basis an and tons for Louisiana making a total of 2431 tons raw basis The Cuban crop may be set at tons of which approximately I I tons will wi be sold to Canada Canada the United Kingdom other European countries and the Far East and about tons will wi be consumed consumed con con- locally leaving for forthe forthe forthe the United States There must be added about tons of 1925 beet sugar which will wi be distributed before the end of the year The total available supply in terms of refined sugar for this year Yer for the United States for consumption consumption tion ton and export will wi thus be about long tons Exports of refined sugar may be estimated at about tons which would leave available for domestic consumption consumption consumption con con- for the calendar r year 1925 about tons Trade figures of consumption for the first frt quarter of the year show an increase over last year of 87 per cent which applied applied ap ap- ap- ap plied pled to last years year's consumption of long tons Willett Viett Gray would mean mean a consumption for the year of about tons I leaving an apparent surplus of about tons This is a close cose margin on o the es estimated estimated estimated es- es consumption and might be wiped out by summer demands somewhat greater than ordinary In InI Inthe Inthe I the last year of low prices pries 1922 the per capita consumption according according accord accord- ing to the government estimate was 1038 pounds while in 1924 it was vas pounds A rise to the 1922 rate would wipe out the indicated indicated indi indi- surplus several times over There is to be considered not not only the normal increase of demand and the increase naturally resulting from the low price but that European beet production is now back on practically the war pre-war basis and the price e is so low as to be un- un remunerative on the bulk of prOduction pro production ducton in all al countries These facts afford aford reason for belief belef that plantings at least wi ill not increase and as the yield on the present crop has been generally good it would seem probable that the sugar pro are ip in line for some such change as has come conic to the hog ra raisers sers rubber producers and wheat wheat- I growers |