World sugar markets may see a supply deficit of up to five million tonnes in 2004/05, a gap that could be halved by just a modest output rise from Brazil, the International Sugar Organisation (ISO) said on Tuesday.
"Looking at the prospects for the coming 2004/05 cycle, the fundamental situation may improve. Early indications point in the direction of a global deficit in the order of four to five million tonnes," the ISO's Executive Director Peter Baron said.
But if sugar production in the world's top grower Brazil were to rise by three percent in 2005, the global sugar deficit would fall to between 2.0 and 2.5 million tonnes, he told delegates at F.O. Licht's European Sugar conference.
The ISO has estimated a world sugar surplus of 0.222 million tonnes, raw value, in 2003/04, against 6.857 million in 2002/03.
Assuming annual growth at 2.5 percent a year, in line with the long-term average, world consumption in the coming crop year might reach 149.3 million tonnes, Baron said, adding this would be a "healthy growth" of 3.7 million tonnes from this season.
The bullish effect of the likely deficit would be offset, at least in the early part of the coming crop cycle, by hefty accumulated stocks, Baron said. But the situation was unclear.
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