Many cubes of sugar in a pile by pasja1000 via Pixabay
October NY World Sugar #11 (SBV25) on Friday closed -0.28 (-1.69 %), and closed white sugar in London in London (SWV25) -9.20 (-1.92 %).
Sugar prices fell on Friday and were under pressure this week due to speculation that India may enhance sugar exports.
On Wednesday, sugar prices decreased to their lowest levels for 3 weeks after Bloomberg stated that India may allow the local sugar mills to export sugar in the next season, which begins in October, as abundant wind rains may produce the bumper sugar crop. The Meteorological Department of India said on Monday that the cumulative monsoon rain in India is higher than 6 % as of July 21.
Expectations for high sugar production in Brazil are low for sugar. Datagro said on Monday that the dry weather in Brazil had encouraged the country’s sugar factories to increase their cane crushing, which turns more sugar cane crushing towards the most profitable sugar production instead of ethanol. According to Covrig, it is expected that the Brazilian sugar factories will crush 54 % of the cane available in the first half of this month, probably adding 3.2 million tons of sugar to the market.
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). Also, ISMA reported on July 7 that the production of sugar in India during October 1, May 15, decreased -17 % on an annual basis to 25.74 megawatts.
Sugar prices have declined during the past three months, as NY SUGAR decreased to its lowest level 4.25 years earlier this month, and London sugar sliding to the lowest level in approximately 4 years, driven by surplus sugar 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.
The signs that the last segment of sugar prices to its lowest levels for 4 years has sparked the demand for the demand is positive for sugar prices. Chinese sugar imports in June increased by 1.435 % to 420,000 metric tons. Also, President Trump said last Wednesday that Coca -Cola agreed to use sugar cane in coke drinks sold in the United States instead of high fructose corn syrup, which could boost the US sugar consumption by +4.4 % to 11.5 million metric tons from 11 million tons currently, according to Bloomberg’s intelligence.
Also, sugar prices have support from low sugar production in Brazil. UNICA stated last Monday that the cumulative directing 2025/26, Brazil, southern center decreased during the month of June by -14.3 % on an annual basis to 12.249 million tons. Last month, Konab, the government -predicing agency in Brazil, said that the production of sugar in Brazil 2024/25 decreased by -3.4 % on an annual basis to 44.118 million metric tons, citing sugar cane depressions due to drought and excessive heat.
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 International Sugar Organization (ISO) raised the forecasts of the World Sugar deficit for the year 2024/25 to the highest level in 9 years of -5.47 million tons on May 15, up from February -88 m This indicates a tightening market after the global sugar surplus 2023/24 of 1.31 million tons. ISO has also reduced the forecast of international sugar production for the year 2024/25 to 174.8 million tons of February forecast 175.5 million tons.
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
