London, 6 September 2011

Trade house Czarnikow's head of research Toby Cohen on Monday forecast a global sugar surplus of around 4-5 million tonnes in 2011/12. "We're roughly in line with where most of the market is coming in at the moment, which is around a 4-5 million tonne surplus," Cohen told Insider television in an interview, coinciding with Czarnikow's 150th anniversary celebrations.

Cohen said China, which faces drought and has drawn down stocks significantly this year, could emerge as the world's number 1 sugar importer in 2011/12. "They (China) are going to come to the forefront as a big importer of sugar," he said.

He said he expected Russia, currently the number 1 sugar buyer from top producer Brazil, to have a "fantastic crop", but he gave no figures. "Russia's position as a big importer in the market is starting to fade," he said. Cohen added that China was likely to pick up the slack from Russia as a key market for Brazilian sugar in 2011/12.

"Brazil's opportunities are in the east," he said. Asked to comment on the sugar market outlook, Cohen said, "If that stress (on Brazil) gets worse, I think that (sugar) prices could edge up."

He was referring to recent downward revisions by analysts to Brazilian sugar output forecasts due to a combination of adverse weather and aging cane plants.

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Reuters - for Commmodities Now