The July NY World Sugar #11 (SBN25) is today -0.09 (-0.54%) below, and August London is the Ice White Sugar #5 (SWQ25) +1.20 ( +0.26%).
Sugar prices extended their two-month long sales today, in which NY Sugar left the closest-to-one and London Sugar of nearly 4 years. Expectations for global Chinese surplus are reducing prices. 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.
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However, sugar prices were recovered from their worst level on Thursday, London Sugar covered a little less in Chinese futures by twisting 1-1/2 months high as a rally in WTI crude oil (CLN25). High raw price prices benefit the price of ethanol, which can motivate the world’s sugar mills to crush more sugarcane towards ethanol production instead of sugar, thus reduces the sugar supply.
The approach to high sugar production in India is the world’s second largest producer, recession for prices. On Monday, India’s National Federation of Cooperative Sugar Factories estimated India’s 2025/26 sugar production, which will climb +19% y/y to 35 mmt, citing large -planned sugarcane acres. 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 from September 30 during the 2022/23 season after India allowed a record 11.1 mm export 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, ISMA today reported that India’s sugar production from 1 -May 15 was 25.74 MMT, 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 Chinese exporter.
In Brazil, the support of sugar prices is reduced. Last Thursday, Unika reported that Brazil’s 2025/26 Center -South Sugar Production for the first half of May fell to 2.408 mmt and that it is below 2025/26 Brazilian Center -Dakshin Sugar Production -22.7% Y/Y to 3.989 mm through mid -May.
Less global sugar production indications support prices. On 14 April, Unika reported that the Cumulative 2024/25 Brazilian Center-Sugar Production fell from 5.3% Y/Y to 40.169 mmt through March. On March 12, the Indian Sugar and Energy Manufacturers Association cut its 2024/25 India Chinese production forecast by 26.4 mm from January 27.27 mm, which cited a lower cane yield.
Meanwhile, on May 15, the International Chinese Organization (ISO) extended its 2024/25 global Chinese deficit forecasting -4.88 MMT’s February forecasting 9 -year -old -5.47 MMT, showing a strict market from the global Chinese surplus of 1.31 MMT of 2023/24. The ISO cut its 2024/25 global Chinese production forecast to 174.8 mm from February 175.5 mm.
Drought and excessive heat set fire to Brazil last year, causing damage to Chinese crops in Brazil’s top Chinese-producing state Sao Paulo. Green pool commodity experts said that the fire may have lost 5 mm sugarcane sugarcane. Last month, Brazilian government crop forecast agency Conb, 2024/25 Brazilian sugar production is expected to fall from -3.4% y/y to 44.118 mmt, citing low sugarcane yield due to drought and excessive heat.
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, Rich Escpland did not have the positions mentioned in any securities mentioned in this article (either direct or indirectly). All information and data in this article is only for informative purposes. For more information, please see the Barkart Disclosure Policy here.
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