Might NY world sugar #11 (SBK26) immediately is down -0.09 (-0.65%), and Aug London ICE white sugar #5 (SWQ26) is down -6.40 (-1.47%).
Sugar costs gave up an early advance immediately and turned decrease, as expectations of a bumper Brazilian sugar harvest are limiting the upside within the quick time period. Sugar costs initially transfer larger immediately, with NY sugar posting a 2-week excessive and London sugar posting a 3-week excessive after gasoline costs (RBM26) rallied to a 3.75-year excessive, which boosts ethanol costs and will immediate the world’s sugar mills to divert extra cane crushing towards ethanol manufacturing relatively than sugar, thus curbing sugar provides.
Extra Information from Barchart
Sugar costs have been underneath strain for the previous 4 weeks, with NY sugar falling to a 5.5-year low within the nearest futures contract on April 17 amid expectations of considerable international provides and tepid demand. The April 15 expiration of the Might London sugar contract noticed 472,650 MT of deliveries to settle the contract, probably the most for a Might contract in 14 years, an indication of tepid sugar demand.
Greater sugar manufacturing in Brazil is bearish for sugar costs. On March 27, Unica reported that cumulative 2025-26 Middle-South sugar output (October via mid-March) rose +0.7% y/y to 40.25 MMT, with sugar mills boosting the quantity of cane crushed for sugar to 50.61% from 48.08% final yr. On Friday, Conab, Brazil’s authorities forecasting company, stated that it expects 2025/26 Brazil sugar manufacturing of 44.196 MMT, up +0.1% y/y.
Sugar costs additionally took successful earlier this month when India’s Meals Secretary stated the federal government has no plans to ban sugar exports this yr, easing considerations that it might divert extra sugar to make ethanol following the Iran struggle disruption to crude oil provides. On February 13, India’s authorities accepted a further 500,000 MT of sugar for export for the 2025/26 season, on high of the 1.5 MMT accepted in November. India launched a quota system for sugar exports in 2022/23 after late rain decreased manufacturing and restricted home provides.
The outlook for smaller Brazilian sugar output is supportive of costs. Final Tuesday, the USDA forecast Brazil’s 2026/27 sugar manufacturing at 42.5 MMT, down -3% y/y, citing millers crushing extra cane for ethanol than for sugar.
Indicators of a smaller international sugar surplus are additionally supportive for costs. Final Tuesday, Covrig Analytics minimize its 2026/27 international sugar surplus estimate to 800,000 MT from 1.4 MMT beforehand. On Monday, sugar dealer Czarnikow minimize its 2026/27 international sugar surplus estimate to 1.1 MMT from 3.4 MMT in February, and minimize its 2025/26 surplus estimate to five.8 MT from 8.3 MMT.
Sugar costs even have some assist amid considerations over provide disruptions from the continuing closure of the Strait of Hormuz. In keeping with Covrig Analytics, the closure of the strait has curbed roughly 6% of the world’s sugar commerce, constraining refined sugar output.
On April 16, India’s Nationwide Federation of Cooperative Sugar Factories Ltd. reported that India’s 2025-26 sugar manufacturing from Oct 1-Apr 15 was up +7.7% y/y to 27.48 MMT. On March 11, the Indian Sugar and Bio-energy Producers Affiliation (ISMA) projected India’s 2025/26 sugar manufacturing at 29.3 MMT, up 12% y/y, beneath an earlier projection of 30.95 MMT. The ISMA additionally minimize its estimate for sugar used for ethanol manufacturing in India to three.4 MMT from a July forecast of 5 MMT, which can permit India to spice up its sugar exports. India is the world’s second-largest sugar producer.
The Worldwide Sugar Group (ISO) on February 27 forecasted a +1.22 MMT (million metric ton) sugar surplus in 2025-26, following a -3.46 MMT deficit in 2024-25. ISO stated the excess is being pushed by elevated sugar manufacturing in India, Thailand, and Pakistan. ISO is forecasting a +3.0% y/y rise in international sugar manufacturing to 181.3 million MMT in 2025-26.
The USDA, in its bi-annual report launched on December 16, projected that international 2025/26 sugar manufacturing would climb +4.6% y/y to a file 189.318 MMT and that international 2025/26 human sugar consumption would improve +1.4% y/y to a file 177.921 MMT. The USDA additionally forecast that 2025/26 international sugar ending shares would fall by -2.9% y/y to 41.188 MMT. The USDA’s International Agricultural Service (FAS) predicted that Brazil’s 2025/26 sugar manufacturing would rise by 2.3% y/y to a file 44.7 MMT. FAS additionally predicted that India’s 2025/26 sugar manufacturing would improve by 25% y/y to 35.25 MMT, pushed by favorable monsoon rains and elevated sugar acreage. As well as, FAS predicted that Thailand’s 2025/26 sugar manufacturing will improve by +2% y/y to 10.25 MMT.
On the date of publication, Wealthy Asplund didn’t have (both immediately or not directly) positions in any of the securities talked about on this article. All data and information on this article is solely for informational functions. This text was initially printed on Barchart.com
