July NY World Sugar #11 (SBN25) Today +0.13 ( +0.82%), and August London Ice White Sugar #5 (SwQ25) +10.50 ( +2.24%).
Sugar prices recovered from the initial deficit today and the WTI increased after +2% rally in crude oil (CLQ25) Chinese futures raised some minimal and decades. High raw prices prices benefit ethanol prices and may motivate the world’s sugar mills to crush towards ethanol production instead of sugar, thus curbing the sugar supply.
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Sugar prices have fallen in the last three months, NY Sugar has reduced the closest flow of 4 years today due to expectations of global Chinese surplus. On 22 May, in its bipolar report, the USDA estimated that the global 2025/26 Chinese production +4.7% year-on (y/y) increased to a record 189.318 million metric tons (MMT), with a global sugar surplus of 41.188 MMT, to 7.5% year-old.
The approach to high sugar production in India is the world’s second largest producer, recession for prices. On 2 June, India’s National Federation of Cooperative Sugar Factory estimated that India’s 2025/26 sugar production would climb on +19% y/y to 35 mmt, citing the large -planned sugarcane. The approach to abundant rainfall in India can cause a bumper sugar crop, which is a recession for prices. On 15 April, the Ministry of Earth Sciences of India estimated an above-normal monsoon this year, with a total rainfall of 105% of the long-term average. India’s monsoon season runs from June to September.
Large global sugar production indications are negative for prices. On 22 May, the USDA’s Foreign Agricultural Services (FAS) predicted that Brazil’s 2025/26 Chinese production +2.3% Y/Y would increase a record 44.7 mmt. In addition, India’s 2025/26 sugar production is estimated to increase from +25% y/y to 35.3 mmt, citing favorable monsoon rains and increased sugar acres. In addition, Thailand’s 2025/26 Chinese production is expected to climb 10.3 mmt to 10.3 mmt.
In a recession factor, the Government of India said on January 20 that it would allow its sugar mills to export 1 MMT sugar in this season, reducing the restrictions on sugar exports in 2023. India has banned Chinese exports from October 2023 to maintain adequate domestic supply. India allowed mills to export only 6.1 MMT sugar during the 2022/23 season after permission to export records 11.1 MMT in the previous season. However, the ISMA project that will fall India’s 2024/25 sugar production -17.5% y/y, which will be at a 5 -year low of 26.2 MMT. In addition, the ISMA said last Monday that India’s sugar production from October 1 -May 15 was 25.74 mm, which was -17% from the same period last year. In addition, Indian Food Secretary Chopra said on 1 May that India’s 2024/25 Chinese exports can only be 800,000 MT, which is less than the expectations of 1 MMT first.
The approach to high sugar production in Thailand is a slowdown for sugar prices. On 2 May, the office of the sugarcane and sugar board of Thailand reported that Thailand’s 2024/25 sugar production increased to 14% y/y 10.00 mm. Thailand is the third largest Chinese producer in the world and the second largest exporter of sugar.
A positive factor for sugar prices is an expected increase in sugar imports from Pakistan, after the Pakistani government announced last Friday that it is planning to import 250,000 metric tons of raw sugar due to disappointing sugarcane crop.
Sugar prices have some support from low sugar production in Brazil. Unika said last Monday that the 2025/26 Brazilian Center -South Sugar Production -11.6% y/y is below 6.954 MMT through May. Last month, Brazil’s official crop forecasting agency Conb said that 2024/25 Brazil sugar production -3.4% y/y has fallen from 44.118 mmt to dry and cite low sugarcane yield due to drought and excessive heat.
The International Sugar Organization (ISO) raised its 2024/25 global Chinese deficit forecast for 9 -year highest -5.47 MMT from the February forecast of 4.88 MMT. This indicates a tightening market after the 2023/24 global Chinese surplus of 1.31 mmt. The ISO cut its 2024/25 global Chinese production forecast to 174.8 mm from February 175.5 mm.
In its bi-annual report released on 22 May by the USDA, it was estimated that the global 2025/26 sugar production +4.7% Y/Y will climb a record 189.318 mmt and the global 2025/26 human sugar consumption will increase +1.4% y/y record 177.921 mmt. The USDA also estimated that 2025/26 Global Sugar Ending Stock +7.5% Y/Y to climb 41.188 mmt.
On the date of publication,
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