Sugar prices jump on reports of a decrease in sugar cane in Brazil

October NY World Sugar #11 (SBV25) on Friday closed +0.24 (+1.50 %), and closed white sugar in London in London No. 5 (SWV25) +8.80 (+1.90 %).

On Friday, sugar prices settled on anxiety about the smaller sugar supply from Brazil. Covrig Analytics said on Friday that reports on the revenues of cane smaller than sugar farmers in Brazil may expel the production of Brazil in 2025/26 sugar cane less than 600 million tons, which is much lower than the expectations of the Brazilian government prediction agency of 663.4 MB.

The power in the real Brazilian (^USDBRL) was also a supportive factor for sugar, as the high raised to the highest level in one month against the dollar on Friday, which led to the disconnection of export sales of sugar producers in Brazil.

On Tuesday, sugar prices fell to 5 weeks from the lowest signs of the most powerful sugar production in Brazil. Last Thursday, UNICA reported that sugar was removed in the Brazil Center in the first half of July, increasing 15 % on an annual basis to 3.4 million tons. Also, the amount of sugar cane to be crushed by sugar by sugar factories in Brazil increased to 54 % of 50 % at the same time last year.

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 Meteorological Department said on Tuesday that the cumulative seasonal winds in India were 500.8 mm as of August 4, or 4 % higher than the normal rate. Also, the Indian Diabetes and Energy Manufacturers Association said last Thursday that 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 have declined during the past four months, as sugar in New York decreased to its lowest level last month for 4.25 years, and sugar in London was sliding to the lowest level of 4 years, driven by sugar surplus expectations in the 2025/26 season. On June 30, the CZANIKOW commodity dealer expected a global surplus of global sugar 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.