Sugar Prices Weighed Down by an Improving Supply Outlook
By: barchartnews|2025/05/03 03:00:03
0
Share
July NY world sugar #11 (SBN25) Friday closed up +0.04 (+0.23%), and August London ICE white sugar #5 (SWQ25) closed down -4.10 (-0.83%).Sugar prices on Friday extended their month-long selloff, with July NY sugar posting a 3-3/4 year nearest-futures low and London sugar posting a 2-week low. However, sugar prices recovered from their worst levels Friday, with NY sugar climbing into positive territory as a weaker dollar (DXY00) sparked short covering in sugar futures.The outlook for higher Brazil sugar production is undercutting prices. On Wednesday, Unica reported that Brazil Center-South sugar production for the first half of April rose +1.3% y/y to 731,000 MT. Wednesday's report from Unica is the first report for the 2025/26 season. On Tuesday, Conab forecast Brazil's 2025/26 Brazil sugar production would climb +4.0% y/y to 45.875 MMT. On Thursday, Bloomberg reported that Louis Dreyfus was the only trader to deliver raw sugar to settle the NY May sugar futures that expired on Wednesday. About 1.5 MMT of sugar was delivered to settle the May futures contract, the fifth-largest for the contract in 5 years, according to StoneX. The large delivery signals weak sugar demand.Signs of larger global sugar output are negative for prices. Last Wednesday, the USDA's Foreign Agricultural Service (FAS) predicted that Brazil's 2025/26 sugar production would climb +2.3% y/y to 44.7 MMT from 43.7 MMT in the previous season. The outlook for abundant rain in India that leads to a bumper sugar crop is undercutting sugar prices. On April 15, India's Ministry of Earth Sciences projected an above-normal monsoon this year, with total rainfall forecast to be 105% of the long-term average. India's monsoon season runs from June through September. Also, on the negative side, consultant Datagro on March 12 projected that 2025/26 Brazil Center-South sugar production would climb +6% y/y to 42.4 MMT. In addition, Green Pool Commodity Specialists on February 5 projected that the worldwide sugar market will shift to a surplus of +2.7 MMT in the 2025/26 crop year from its estimate of a deficit of -3.7 MMT in 2024/25.In a bearish factor, the Indian government said on January 20 that it would allow its sugar mills to export 1 MMT of sugar this season, easing the restrictions placed on sugar exports in 2023. India has restricted sugar exports since October 2023 to maintain adequate domestic supplies. India allowed mills to export only 6.1 MMT of sugar during the 2022/23 season to September 30 after allowing exports of a record 11.1 MMT in the previous season. However, the ISMA projects that India's 2024/25 sugar production will fall -17.5% y/y to a 5-year low of 26.4 MMT. Also, Indian Food Secretary Chopra said on Thursday that India's 2024/25 sugar exports may only total 800,000 MT, below earlier expectations of 1 MMT.The outlook for higher sugar production in Thailand is bearish for sugar prices. Last Friday, Thailand's Office of the Cane and Sugar Board reported that Thailand's 2024/25 sugar production rose +14% y/y to 10.00 MMT. Thailand is the world's third-largest sugar producer and the second-largest sugar exporter.Sugar prices have carryover support from April 17 when the Indian Sugar and Bio-Energy Manufacturers Association (ISMA) reported that India's sugar production from Oct 1-Apr 15 was 25.5 MMT, down -18% from the same period last year.Signs of lower global sugar production are supportive of prices. Unica reported on April 14 that the cumulative 2024/25 Brazil Center-South sugar output through March fell by 5.3% y/y to 40.169 MMT. On March 12, the Indian Sugar and Bio-energy Manufacturers Association cut its 2024/25 India sugar production forecast to 26.4 MMT from a January forecast of 27.27 MMT, citing lower cane yields. Meanwhile, the International Sugar Organization (ISO) on March 6 raised its 2024/25 global sugar deficit forecast to -4.88 MMT from a November forecast of -2.51 MMT, showing a tightening market from the 2023/24 global sugar surplus of 1.31 MMT. The ISO also cut its 2024/25 global sugar production forecast to 175.5 MMT from a November forecast of 179.1 MMT. Drought and excessive heat last year caused fires in Brazil that damaged sugar crops in Brazil's top sugar-producing state of Sao Paulo. Green Pool Commodity Specialists noted that as much as 5 MMT of sugar cane may have been lost due to the fires. Last Thursday, Conab, Brazil's government crop forecasting agency, projected 2024/25 Brazil sugar production to fall -3.4% y/y to 44.118 MMT, citing lower sugarcane yields due to drought and excessive heat. The USDA, in its bi-annual report released November 21, projected that global 2024/25 sugar production would climb +1.5% y/y to a record 186.619 MMT and that global 2024/25 human sugar consumption would increase +1.2% y/y to a record 179.63 MMT. The USDA also forecasted that 2024/25 global sugar ending stocks would decline -6.1% y/y to 45.427 MMT. On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
You may also like

Seven Green Candles Meet Three White Soldiers | Rewire News Morning Brief
Last night the Fed minutes already released the "hold the line on tightening" signal, CPI is the second shoe

Gold Revisits $4800, Where Is the Top This Year?
The price ceiling of gold depends on your risk tolerance ceiling.

Anthropic's Earth's Most Powerful AI So Strong It Made Wall Street Hold Emergency Meeting, But JPMorgan Was Missing Its "Antidote"
Glasswing doesn't just manufacture a technical barrier, but an informational barrier

Why did Covenant AI flee from Bittensor?
Decentralization has been repeatedly mentioned, but power has never truly left the hands of a few controllers

March Exchange Rankings: Market Shrinks Overall, Spot Trading Volume Sees Rare Over 20% Decline
In March, the spot trading volume of mainstream CEXs decreased by 21.35% compared to February, while the perpetual contract trading volume decreased by 6.14% compared to February.

After the node dropped by 70%, Solana is anxious this time
The internal and external challenges on the road to impact the "on-chain Nasdaq"

Morning News | Binance officially launches prediction market; Circle introduces stablecoin settlement solution; Bitmine listed on the NYSE main board
Overview of Important Market Events on April 9th

WEEX OTC Now Supports EUR Deposits via SEPA Bank Transfer
To provide a smoother, more accessible fiat on-ramp, WEEX OTC has added SEPA Bank Transfer.

Hyperbeat, to launch a "bank" on Hyperliquid
A chain built for transactions, now wanting you to stash your paycheck there.

Crypto Market Macro Research: US-Iran Ceasefire, Time to Reassess Risk Assets
How Does the US-Iran Ceasefire Impact Risk Assets?

Is Bitcoin Forming a Bottom in 2026? How the Tariff Shock and Ceasefire Could Push BTC Toward $75K
Bitcoin may be forming its 2026 bottom near $65K. See how tariff shocks, ETF inflows, and the Iran ceasefire could shape BTC’s next breakout toward $75K.

Stablecoins Hit $315 Billion in 2026: Why This Is the Biggest Trend in Crypto Right Now
Bitcoin may be forming its 2026 bottom near $65K. See how tariff shocks, ETF inflows, and geopolitical signals could shape BTC’s next breakout toward $75K.

Tiger Research: A Comprehensive Analysis of the Most Profitable Businesses and Their Business Models in Crypto
Payment fees, shared infrastructure, and offshore demand have become new battlegrounds.

Why is the ceasefire between the U.S. and Iran destined to be unsustainable?
In-depth analysis: Why is the US-Iran ceasefire criticized as "nominal"? When both sides are accustomed to placing their own power above agreements, this brief peace lacking trust is destined to be nothing but ruins.

Starting from the cryptocurrency world, what makes Hermes Agent the biggest challenger to OpenClaw?
Two growth curves are rising at the same time, but the things that are rising are completely different.

Under-the-Radar Middle Eastern Player Set to Be the Star of the 2026 World Cup Prediction Market?
ADI Predictstreet is the Official Prediction Market Partner of the FIFA World Cup 2026.

Turn AI into an individual execution system, Claude's latest Managed Agents Best Practices Guide
From Calling to Hosting, Turning AI from a Tool into a Sustainable Execution System

Why Is the US-Iran Ceasefire Doomed to Fail?
Both parties prioritize the power within the contract
Seven Green Candles Meet Three White Soldiers | Rewire News Morning Brief
Last night the Fed minutes already released the "hold the line on tightening" signal, CPI is the second shoe
Gold Revisits $4800, Where Is the Top This Year?
The price ceiling of gold depends on your risk tolerance ceiling.
Anthropic's Earth's Most Powerful AI So Strong It Made Wall Street Hold Emergency Meeting, But JPMorgan Was Missing Its "Antidote"
Glasswing doesn't just manufacture a technical barrier, but an informational barrier
Why did Covenant AI flee from Bittensor?
Decentralization has been repeatedly mentioned, but power has never truly left the hands of a few controllers
March Exchange Rankings: Market Shrinks Overall, Spot Trading Volume Sees Rare Over 20% Decline
In March, the spot trading volume of mainstream CEXs decreased by 21.35% compared to February, while the perpetual contract trading volume decreased by 6.14% compared to February.
After the node dropped by 70%, Solana is anxious this time
The internal and external challenges on the road to impact the "on-chain Nasdaq"
