Sugar prices fell on the high sugar product in Brazil

October NY World Sugar #11 (SBV25) on Friday closed -11 (-0.67 %), and closed white sugar in London in London (SWV25) -0.50 (-0.10 %).

Sugar prices abandoned early progress on Friday and settled a decrease due to the high production of Brazilian sugar. On Friday, UNICA reported that the extraction of sugar in the Brazil Center in the first half of August increased by +16 % year on an annual basis to 3,615 tons. Also, the sugar cane percentage of sugar by sugar factories in Brazil in the first half of August increased to 55.00 % from 49.15 % at the same time last year. However, the output of the center sugar decreased between the center 2025-26 to the middle of August by -4.7 % on an annual basis to 22.886 million tons.

Sugar prices were initially increased to Friday, when sugar in London occupied the highest level of 3.5 months after the International Sugar Organization (ISO) expected a global sugar deficit for the 2025/26 season, the sixth year in a row of sugar deficit. ISO has a global sugar deficit 2025/26 of -231,000 metric tons, which improves a deficiency of -4.88 million tons in 2024/25. Global sugar production will also increase 2025/26 by +3.3 % year on an annual basis to 180.6 million tons, and global sugar consumption increases 2025/26 +0.3 % on an annual basis to 180.8 completed with a number.

SUGAR also has a positive deportation from Tuesday, when the Conab, the Brazil Government Prediction Agency, has reduced production estimate in Brazil 2025/26 by 3.1 % to 44.5 million tons of previous estimates of 45.9 million tons.

Sugar prices have been pressured over the past two weeks, as it was published for a period of two weeks on Monday due to expectations for low sugar production in Brazil. Last Monday, Covrig Analytics reported that Brazil’s sugar factories give priority to the production of sugar on ethanol, and crushed more sugar cane. This trend is expected to continue with the harvest of the peaks, driven by more dry cane crops that drive the mills to produce more sugar.

On August 12, NY SUGAR rose to the highest level in the 2.5 -month level on concerns about the weakest revenues in Brazil. Connab reported last month that the production of sugar in Brazil 2024/25 by -3.4 % year on an annual basis to 44.118 meganetors, indicating that sugar cane revenues decreased due to dryness and excessive heat.

The expectations for high sugar exports from India are negative for sugar prices after Bloomberg stated that India may allow the local sugar mills to export sugar in the next season, which begins in October, as abundant monsoon rains may produce the bumper sugar crop. The Indian Ministry of Meteorology said last Friday that the cumulative seasonal winds in India were 650.3 mm as of August 22, or 2 % higher than the usual. Also, the Indian Biological and Biological Factors Association said it would seek permission to export 2 million tons of sugar in 2025/26.

The expectations for high sugar production in India, the second largest producer in the world, are downward. On June 2, the National Union of Cooperative Diabetes expected that sugar production in India 2025/26 in India will climb +19 % on an annual basis to 35 million tons, citing a larger cane area. This would follow a decrease in the production of sugar in India -17.5 % in 2024/25 to the lowest level of 5 years of 26.2 million tons, according to the Indian Sugar Mills Association (ISMA).

Sugar prices fell to early July, as sugar in New York fell to a low decrease in sugar for 4.25 years to the lowest level in London to a 4 -year low level, driven by sugar surplus expectations in the 2025/26 season. On June 30, the CZANIKOW commodity dealer expected a global sugar surplus of 7.5 million tons for the 2025/26 season, which is the largest surplus in 8 years. On May 22, the US Department of Agriculture expected, in its classic report, that the production of global sugar 2025/26 will increase by +4.7 % on an annual basis to 189.318 million tons, as global sugar ends in 41.188 million tons, an increase of 7.5 % on an annual basis.

Expectations for high sugar production in Thailand are low for sugar. On May 2, the Thailand office in sugar cane and sugar reported that the production of sugar 2024/25 from Thailand increased +14 % year on an annual basis to 10.00 million tons. Thailand is the third largest sugar producer in the world and the second largest sugar exporter.

The US Department of Agriculture expected, in its annual bilateral report, which was released on May 22, that the production of global sugar 2025/26 will increase +4.7 % on an annual basis to 189.318 million metric tons, and that global sugar consumption 2025/26 will increase +1.4 % on an annual basis to 177.921 million tons. The US Department of Agriculture also expected that the storage of 2025/26 global sugar would climb +7.5 % year on year to 41.188 million tons. Foreign Agricultural Service in the US Department of Agriculture (FAS) predicted that the production of sugar in Brazil 2025/26 will rise +2.3 % year on year to 44.7 million metric tons in India, the production of sugar in India 2025/26 will increase. FAS expected that the production of sugar 2025/26 from Thailand will climb +2 % on an annual basis to 10.3 million tons.

On the date of publication, Rich Asplund did not have positions (either directly or indirectly) in any of the securities mentioned in this article. All information and data in this article are only for media purposes. This article was originally published on Barchart.com

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