Trader ED&F Man predicted on Friday a global sugar deficit of 3.4 million tonnes in 2004/05 amid expectations of lower Asian crops and increased Brazilian output of ethanol from sugar. The firm has estimated a deficit of one million tonnes for 2003/04. "Over the next three months, more bullish news is expected to reach the market, as lower Thai, Chinese and Indian production figures are confirmed," ED&F Man said in a report.
"Furthermore, the start of next year's center-south Brazil crop will see a higher allocation to ethanol production," it added. "Our first estimate of 2004/05 shows a sizeable deficit of 3.4 million tonnes." Analysts' forecasts for the 2004/05-sugar supply-demand balance vary sharply. FO Licit has said it expects global output and consumption to be roughly in balance, and trader Czarnikow sees a global deficit of 4.78 million tonnes.