This report evaluates the U.S. and world sugar markets for 2003-2013 using the Global Sugar Policy Simulation Model. This analysis is based on assumptions about general economic conditions, agricultural policies, population growth, weather conditions, and technological changes. Both the U.S. and world sugar economies are predicted to improve over the next 10 years after the current over-supply is reduced. World demand for sugar is expected to grow faster than world supply, resulting in Caribbean sugar prices gradually increasing from 7.57 cents/lb in 2003 to 8.75 cents/lb in 2013. The U.S. wholesale price of sugar is projected to increase from 25.35 cents/lb in 2003 to 27.0 cents/lb in 2013, if the United States maintains its sugar programs. The CAFTA agreement is expected to increase U.S. imports slightly, but with little impact on U.S. prices. World trade volumes of sugar are expected to increase throughout the forecast period.