In 2015 Guatemala led the export of raw sugar with $848 million, followed by El Salvador with $178 million and Nicaragua with $114 million.
Foreign Trade figures for Raw sugar in Central America, analyzed by the Business Intelligence unit at CentralAmericaData report that in 2015 the countries in Central America exported a combined total of 3 million 292 thousand tons of raw sugar equivalent to $1.289 billion.
The drought has forced a prematurely end to the crushing season, which already experienced in the past fortnights performance drops of 42% compared to last year.
Zafranet.com reports that "... Sugar production in Brazil, the world's largest exporter of the raw material, is slowing rapidly due to a drought this year which will provoke an early end to the milling season in the coming weeks, said the Union of Sugarcane Industry in Brazil, Unica, on Tuesday. "
The Guatemalan sugar industry has proposed the government to co-invest in the expansion of terminal facilities in order to increase capacity and make it more competitive.
In an attempt to improve the conditions of the port terminal and restore the competitiveness of Guatemalan exports, the guild of sugar millers is willing to invest in the expansion of Port Quetzal.
Authorization has been given for the purchase of 550,000 tons of sugar cane and 100,000 tons of sugar beet for the current season.
The new allocation established by the U.S. Department of Agriculture (USDA), represents an increase of about 50% on the existing quota of 1.32 million tonnes.
"Among the reasons for the increase of the quota, is the reduction of local production and the abrupt change in market conditions since sugar mills in the United States initiated a trade dispute with Mexico two months ago. Since filing the complaint against the Mexican plants in late March, local prices have gone up by 16%... ".
The drought in Brazil, the country which exports almost half of the world's sugar, caused prices of the grain on the international market to rise to $444 a ton.
The drought in Brazil led to an increase in the international price of sugar. The South American country exports almost half of the grain in the world.
The lack of rain also caused an increase in the international price of coffee.
Nicaragua is able to sell 10,163 metric tons duty free to the EU.
Altogether, the Central America's total export quota adds up to 150,000 tons.
Mario Salaverria, president of the Sugar Association of El Salvador said the decision to sell the sugar was due to "uncertainty about the problem they had with Italy and that delivery times won't allow them to make the most of this access."
Added to the 17 thousand tons that Nicaragua and Honduras can offer are 25,000 from Guatemala, which will be auctioned to buyers from the European Union.
Elnuevodiario.com.ni reports that "Nicaragua and Honduras are offering 42,000 tons of sugar in the electronic auction to be held today for the second time under the framework of the Association Agreement, or AA, between the European Union and Central America, after the first round was unsuccessful. "
Nicaragua and Honduras are allowed to sell 65,000 more metric tons duty-free to the European Union.
The country has given approval for both Nicaragua and Honduras to receive this benefit temporarily, until the trade agreement becomes effective for Guatemala. "The Council of Ministers of Economy and Trade for Central America (Comieco) gave authorization this weekend for each country in the region to be able to make available its quotas at will" reported Nicaraguahoy.info.
The country won't cede its sugar quota to Nicaragua and Honduras, and it opposes to Guatemala, El Salvador and Panama conceding theirs.
For Costa Rica, Guatemala and El Salvador the Association Agreement with the European Union has not yet entered into force, so they are prevented from offering their sugar in an auction where 35 buyers bid to bring it to market in the old continent.
The sugar industry wants the government to pass legislation to mix ethanol into automotive fuel.
The initiative is being promoted by the Sugar Association of Guatemala (Azasgua), The Local Alcohol Productive Arrangement (APLA) and the Brazilian Agency for Promotion and Investment.
The interest in initiating talks with the sugar industry is due to the fact that this is the most sophisticated and has the best technology to produce ethanol using molasses, said the representative of APLA, Flavio Castelar.
The sector, which was ready to export 10,000 tonnes of sugar to the European Union, must wait two more months to do so.
Non-acceptance by dairy farmers in El Salvador and Costa Rica of the geographical indicators for Italian cheeses has caused a delay of at least 60 days of the entry into force of the Association Agreement with the EU.
"We were ready to export, but if there is no treaty we will have to send the sugar to another market at a lower price than would have been paid by the Europe" said Julio Arroyo, CEO of the Sugar Association of El Salvador.
The Nicaraguan sugar industry expects that the entry into force of the Association Agreement will allow it export to the EU about 25 thousand tons of raw sugar, from the 60,000 quota for the entire region.
For the moment the quota allocated to country is 21,600 tons per year, with the possibility of growing 550 tons per year, but the sugar industry expects that with the advantage of being one of the first countries to ratify the agreement it will be allowed to increase its quota for the first year of the Association Agreement (AA).
At the end of the 2012-13 total production from the harvest was 60.049 million quintals of sugar, which is 2,782,000 metric tons.
The harvest that has just concluded, grew by 11% compared to the period 2011-12, when the production reached 54.033 million quintals (2,499,000 metric tons).
According to Armando Boesche, general manager of the Sugar Association of Guatemala (Asazgua), climatic conditions during the last six months "were appropriate, as there were more daylight hours in the time of greatest growth for sugarcane" .
Guatemalan sugar producers expect to produce 57 million quintals from the harvest which ends this May, which is 5% more than in the 2011-12 harvest.
According to Armando Boesche, CEO of the Sugar Association of Guatemala (Asazgua), the production of the 12 sugar mills operating in Guatemala will increase by three million quintals.
"The weather conditions last year (2011-2012) compared to this year (2012-2013) were similar and conducive to the cultivation of sugarcane. This allowed better yields in field and factory," he added.
With the reduction in harvests in Mexico and India, sugar production could decline for the first time since 2009.
World production of sugarcane could decrease by 51% during the 2013-14 season compared to the 2012-13 period, as a result of the decline in prices caused by a fall in production in Mexico and India, according to researchers at Kingsman SA.