RECENT SUGAR FALL SPARKS SOVIET, CHINESE BUYING The recent fall in world sugar prices, due to increased producer pricing sales and evidence of export availability, has encouraged renewed buying interest from China and the Soviet Union, London trade house E.D.And F. Man said. Further purchases are expected by the Peoples Republic of China at the lower end of the recent price range, which should limit the downside movement, it said in its latest monthly market report. "And it is believed that the Soviet Union will need to return to the market to take a further 250,000/350,000 tonnes for May/June shipment, Man added. The Soviets purchased five cargoes of raws for April/May shipment towards the end of last month, which brings its total purchases to around 1.65 mln tonnes, Man said. Production estimates for the Thai crop now exceed 2.3 mln tonnes and the final outturn appears set to reach around 2.5 mln tonnes. However, this upturn in the Thai crop is being countered by a reduction in China's production forecast to 5.3 mln tonnes from 5.5 mln estimated earlier. Market participation by Cuba suggests that its crop could be close to last year's 7.3 mln tonnes. But even with similar production Man expects Cuban exports to be significantly down. Cuba was reported to be carrying 1.3 mln tonnes of stocks in September 1985, of which some 440,000 tonnes were used to boost its 1985/86 exports to about 6.9 mln. But as it will not be able to draw on surplus stocks this year, Man estimates Cuba's export availabilty will be reduced to 6.4 to 6.5 mln tonnes. However, Cuba is only one of a large number of exporters with reduced availability, Man said. Since 1980 the total free market export supply has fallen to 18 mln from about 22 mln tonnes. But at the same time free market demand has also fallen by almost the same amount, which has left exporters chasing falling import requirements. A fairly tight balance now appears to have emerged. But the difficult task of keeping production advances at bay still remains, as at least one more season of production deficit is needed to eliminate some of the remaining surplus stocks still overhanging the market, Man said. The increasing cases of record production as a result of record yields and better husbandry have forced sugar producers to strive for greater efficiency. As this increase in efficiency reduces the marginal cost of production, sugar exporters may become more responsive to prices and in particular to upward price movements, Man said. Commenting on the current row between the EC Commission and sugar producers, Man said despite the recent improvement in the level of restitutions, they are still insufficient to fully compensate producers when exporting on the world market. Unless there are further improvements, at least some sugar is expected to remain in intervention, it added.