March NY world sugar #11 (SBH26) on Thursday closed up +0.27 (+1.67%), and December London ICE white sugar #5 (SWZ25) closed up +5.90 (+1.30%).
Sugar costs settled sharply greater on Thursday because of considerations over decrease sugarcane yields in Brazil. Unica reported Thursday that Brazil’s Heart South sugarcane crush within the first half of September was up +6.9% y/y to 46 MMT. Nevertheless, the sugar content material within the cane declined, signaling decrease sugar manufacturing because the sugar content material in crushed cane dropped to 154.58 kilogram per ton (kg/ton) versus 160.07 kg/ton a yr earlier.
Don’t Miss a Day: From crude oil to espresso, join free for Barchart’s best-in-class commodity evaluation.
On Tuesday, NY sugar rallied to a 1.5-month nearest-futures (V25) excessive, and London sugar climbed to a 2-week excessive on indicators of stronger international demand as Pakistan has positioned orders for a complete of 320,000 MT of sugar for rapid supply.
Final Tuesday, NY sugar posted a 4.25-year nearest-futures low, and London sugar posted a 4-year low as they prolonged their 7-month downtrend because of prospects of ample international sugar provides. Final Tuesday, StoneX projected a worldwide sugar surplus of +2.8 MMT for the upcoming 2025/26 season, switching from a deficit of -4.7 MMT within the 2024/25 season.
Larger sugar output in Brazil is bearish for costs. Unica reported Thursday that Brazil’s Heart-South sugar output within the first half of September rose by +15.7% y/y to three.622 MT. Additionally, the proportion of sugarcane crushed for sugar by Brazil’s sugar mills within the second half of August elevated to 53.49% from 47.74% the identical time final yr. Nevertheless, cumulative 2025-26 Heart-South sugar output via mid-September fell -0.1% y/y to 30.388 MMT.
The outlook for greater sugar exports from India is unfavorable for sugar costs, as ample monsoon rains could produce a bumper sugar crop. India’s Meteorological Division reported Tuesday that the cumulative monsoon rain in India as of September 30 was 937.2 mm, 8% above regular and the strongest monsoon in 5 years.
The outlook for greater sugar manufacturing in India is bearish for costs. On June 2, India’s Nationwide Federation of Cooperative Sugar Factories projected that India’s 2025/26 sugar manufacturing would climb +19% y/y to 34.9 MMT, citing bigger planted cane acreage. That will observe a -17.5% y/y decline in India’s sugar manufacturing in 2024/25 to a 5-year low of 26.2 MMT, in keeping with the Indian Sugar Mills Affiliation (ISMA).
One other bearish issue for sugar was the latest assertion from sugar dealer Sucden that India could divert 4 MMT of sugar to make ethanol in 2025/26, which isn’t sufficient to ease the nation’s sugar surplus and will immediate India’s sugar mills to export as a lot as 4 MMT of sugar, above earlier expectations of two MMT. India is the world’s second-largest sugar producer.
The outlook for greater sugar manufacturing in Thailand is bearish for costs after the Thai Sugar Miller Corp on Wednesday projected that Thailand’s 2025/26 sugar crop will improve by +5% y/y to 10.5 MMT. On Might 2, Thailand’s Workplace of the Cane and Sugar Board reported that Thailand’s 2024/25 sugar manufacturing rose +14% y/y to 10.00 MMT. Thailand is the world’s third-largest sugar producer and the second-largest exporter of sugar.
On August 29, the Worldwide Sugar Group (ISO) forecast a worldwide sugar deficit for the 2025/26 season, the sixth consecutive yr of sugar deficits. The ISO initiatives a worldwide 2025/26 sugar deficit of -231,000 MT, bettering from a -4.88 MMT shortfall in 2024/25. The ISO additionally initiatives 2025/26 international sugar manufacturing will rise by +3.3% y/y to 180.6 MMT, and 2025/26 international sugar consumption will improve +0.3% y/y to 180.8 MMT.
Expectations for ample sugar provides are bearish for costs. On June 30, commodities dealer Czarnikow projected a 7.5 MMT international sugar surplus for the 2025/26 season, the most important surplus in 8 years. On Might 22, the USDA, in its biannual report, projected that international 2025/26 sugar manufacturing would improve by +4.7% y/y to a report 189.318 MMT, with international sugar ending shares at 41.188 MMT, up 7.5% y/y.
On August 19, Conab, Brazil’s authorities crop forecasting company, minimize its Brazil 2025/26 manufacturing estimate by 3.1% to 44.5 MMT from a earlier estimate of 45.9 MMT. In July, Conab reported that 2024/25 Brazil sugar manufacturing fell by -3.4% y/y to 44.118 MMT, citing decrease sugarcane yields because of drought and extreme warmth.
The USDA, in its bi-annual report launched Might 22, projected that international 2025/26 sugar manufacturing would climb +4.7% y/y to a report 189.318 MMT and that international 2025/26 human sugar consumption would improve +1.4% y/y to a report 177.921 MMT. The USDA additionally forecasted that 2025/26 international sugar ending shares would climb +7.5% y/y to 41.188 MMT. The USDA’s Overseas Agricultural Service (FAS) predicted that Brazil’s 2025/26 sugar manufacturing would rise +2.3% y/y to a report 44.7 MMT FAS predicted that India’s 2025/26 sugar manufacturing would rise +25% y/y to 35.3 MMT because of favorable monsoon rains and elevated sugar acreage. FAS predicted that Thailand’s 2025/26 sugar manufacturing will climb +2% y/y to 10.3 MMT.
On the date of publication,
Wealthy Asplund
didn’t have (both straight or not directly) positions in any of the securities talked about on this article. All info and knowledge on this article is solely for informational functions.
For extra info please view the Barchart Disclosure Coverage
right here.
Extra information from Barchart
The views and opinions expressed herein are the views and opinions of the creator and don’t essentially mirror these of Nasdaq, Inc.
.png?trim=0,0,0,0&width=1200&height=800&crop=1200:800 "Vote in our Independent Money poll: Have proposed pension or inheritance tax changes affected your retirement savings plans?")
