Current Trends in Global Sugar Prices: An Overview
Today’s sugar prices have experienced a slight decline, with May New York world sugar #11 (SBK25) decreasing by 0.07 cents, equivalent to a 0.39% drop. Meanwhile, August London ICE white sugar #5 (SWQ25) has faced a minor reduction of 0.40 cents or 0.08%. This downward trend in prices is largely influenced by projections from the USDA’s Foreign Agricultural Service (FAS), indicating a 2.3% increase in Brazil’s sugar production for the 2025/26 season, reaching 44.7 million metric tons (MMT), up from 43.7 MMT.
Another contributing factor to the reduced sugar prices is the overshadowing concern that the ongoing global trade tensions may hinder world economic growth. The potential for more tariffs could increase sugar prices for consumers, restraining overall demand.
Despite these bearish indicators, the drop in prices is somewhat mitigated by reports of declining sugar production in India. According to the Indian Sugar and Bio-Energy Manufacturers Association (ISMA), sugar output from October 1 to April 15 was recorded at 25.5 MMT, marking an 18% decrease compared to the same timeframe last year.
Last week, sugar prices were notably weak, with New York sugar hitting a 2.5-year low in November and London sugar reaching a three-month low. Anticipated heavy rainfall in India, which is expected to yield a bountiful sugar harvest, has been bearish for the market. The Ministry of Earth Sciences in India predicted that the upcoming monsoon season, occurring from June to September, could see rainfall at 105% of the long-term average.
On a negative note, market analysts from Datagro forecast a significant 6% increase in Brazil’s sugar production for the 2025/26 season to approximately 42.4 MMT. In another report, Green Pool Commodity Specialists predict a shift in the global sugar market from a deficit of 3.7 MMT in 2024/25 to a surplus of 2.7 MMT in the following crop year.
Additionally, the Indian government has announced the allowance of 1 MMT of sugar exports for the current season, lifting some restrictions that have been in place since October 2023. These restrictions were aimed at maintaining domestic supply levels, with only 6.1 MMT exported during the 2022/23 period. Projections from ISMA suggest that India’s sugar production for 2024/25 might plummet by 17.5% year-on-year, reaching a five-year low of 26.4 MMT.
The prospect of increased sugar production in Thailand also casts a shadow over market prices. The Office of the Cane and Sugar Board of Thailand reported a 14% rise in sugar output for the 2024/25 season, totaling 10.0 MMT. As the world’s third-largest sugar producer, Thailand’s growing output could further influence global dynamics.
Conversely, there are signs that a reduction in global sugar production may support prices in the future. A report from Unica highlighted that Brazil’s Center-South sugar output for the 2024/25 season fell by 5.3% year-on-year, totaling 40.169 MMT. Moreover, the ISMA has lowered its sugar production forecast for India to 26.4 MMT, down from January’s estimate of 27.27 MMT, citing disappointing cane yields.
The International Sugar Organization (ISO) has revised its global sugar deficit forecast for 2024/25 to a possible shortfall of 4.88 MMT, in contrast to its earlier prediction of a deficit of 2.51 MMT. This suggests a tightening market after the 2023/24 season, which saw a surplus of 1.31 MMT. The ISO has also downgraded its global sugar production estimate for 2024/25 to 175.5 MMT from a previous forecast of 179.1 MMT.
High temperatures and drought conditions from the previous year caused severe fires in Brazil’s major sugar-producing state, São Paulo. Analysts from Green Pool Commodity Specialists estimated that these fires may have resulted in a loss of approximately 5 MMT of sugarcane. Recent projections from Conab, Brazil’s crop forecasting agency, suggest a decrease in sugar production for the 2024/25 season, estimating a reduction of 3.4% year-on-year to 44.118 MMT, attributing it to lower cane yields due to adverse weather.
In its bi-annual report released in November, the USDA forecasted a 1.5% increase in global sugar production for 2024/25, predicting a record 186.619 MMT. It also estimated a 1.2% rise in global sugar consumption, leading to a projected consumption total of 179.63 MMT. Additionally, the USDA anticipates that global ending stocks for 2024/25 will decline by 6.1% year-on-year, reaching 45.427 MMT.
