October NY world sugar #11 (SBV25) at present is down -0.35 (-2.20%), and December London ICE white sugar #5 (SWZ25) is down -6.00 (-1.29%).
Sugar costs tumbled to 1-week lows at present as Brazil ramps up sugar manufacturing. Unica reported at present that Brazil’s Middle-South sugar output within the second half of August rose by +18% y/y to three,872 MT. Additionally, the share of sugarcane crushed for sugar by Brazil’s sugar mills within the second half of August elevated to 54.20% from 48.78% the identical time final yr. Nevertheless, cumulative 2025-26 Middle-South sugar output by way of August fell -1.9% y/y to 26.758 MMT.
Sugar costs have been already on the defensive from Tuesday, when sugar dealer Sucden stated that India might divert 4 MMT of sugar to make ethanol in 2025/26, which isn’t sufficient to ease the nation’s sugar surplus and should immediate India’s sugar mills to export as a lot as 4 MMT of sugar, above earlier expectations of two MMT.
An extreme brief place by funds in NY sugar might gasoline good points in any short-covering rally. Final Friday’s weekly Dedication of Merchants (COT) report confirmed funds boosted their net-short positions in NY sugar futures by +32,849 to 182,608 within the week ended September 9, probably the most in nearly 6 years.
Final Monday, NY sugar tumbled to a 4.25-year nearest-futures low on the outlook for increased sugar manufacturing in Brazil. Covrig Analytics just lately reported that Brazil’s sugar mills are prioritizing sugar manufacturing over ethanol, crushing extra cane for sugar. This development is anticipated to proceed as harvesting peaks, pushed by drier cane crops that immediate mills to supply extra sugar.
One other bearish issue for sugar is the prospect of upper sugar exports from India. Final Thursday, the Indian Sugar and Bio-energy Producers Affiliation stated it has requested permission to export 2 MMT of sugar within the 2025/26 season starting in October. India is the world’s second-largest sugar producer.
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 tasks a worldwide 2025/26 sugar deficit of -231,000 MT, bettering from a -4.88 MMT shortfall in 2024/25. The ISO additionally tasks 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.
On August 19, Conab, Brazil’s authorities crop forecasting company, lower 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 attributable to drought and extreme warmth.
Expectations for ample sugar provides are undercutting sugar costs. On June 30, commodities dealer Czarnikow projected a 7.5 MMT international sugar surplus for the 2025/26 season, the biggest surplus in 8 years. On Could 22, the USDA, in its biannual report, projected that international 2025/26 sugar manufacturing would improve by +4.7% y/y to a document 189.318 MMT, with international sugar ending shares at 41.188 MMT, up 7.5% y/y.
The outlook for increased sugar exports from India is destructive for sugar costs, as ample monsoon rains might produce a bumper sugar crop. India’s Meteorological Division reported final Wednesday that cumulative monsoon rain in India was 826.2 mm as of September 10, or 8% above regular.
The outlook for increased 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 may comply with a -17.5% y/y decline in India’s sugar manufacturing in 2024/25 to a 5-year low of 26.2 MMT, in line with the Indian Sugar Mills Affiliation (ISMA).
The outlook for increased sugar manufacturing in Thailand is bearish for sugar costs. On Could 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.
The USDA, in its bi-annual report launched Could 22, projected that international 2025/26 sugar manufacturing would climb +4.7% y/y to a document 189.318 MMT and that international 2025/26 human sugar consumption would improve +1.4% y/y to a document 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 document 44.7 MMT FAS predicted that India’s 2025/26 sugar manufacturing would rise +25% y/y to 35.3 MMT attributable to 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 instantly 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. This text was initially revealed on Barchart.com
