October NY world sugar #11 (SBV25) at the moment is up +0.75 (+4.81%), and August London ICE white sugar #5 (SWQ25) is up +19.40 (+4.23).
Oct NY sugar at the moment matched Wednesday’s contract low however then rallied sharply on short-covering sparked a frost scare in Brazil. The NY sugar nearest-futures July contract posted a 4.25-year low on Monday. Aug London sugar at the moment rallied sharply from Wednesday’s 3.75-year nearest-futures low.
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Sugar costs rallied sharply at the moment as forecasts point out a attainable frost occasion in Brazil later this month. The height time for frost in Brazil’s sugar-growing areas is late July via early-August.
Sugar costs have plummeted over the previous three months attributable to expectations of a worldwide sugar surplus. On Monday, commodities dealer Czarnikow projected a 7.5 MMT international sugar surplus for the 2025/26 season, the most important surplus in 8 years. On Could 22, the USDA, in its biannual report, projected that international 2025/26 sugar manufacturing would enhance by +4.7% y/y to a file 189.318 million metric tons (MMT), with international sugar ending shares at 41.188 MMT, up 7.5% year-over-year.
The outlook for increased sugar manufacturing in India, the world’s second-largest producer, 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 35 MMT, citing bigger planted cane acreage. The outlook for ample rainfall in India may result in a bumper sugar crop, which is bearish for costs. On April 15, India’s Ministry of Earth Sciences projected an above-normal monsoon this 12 months, with complete rainfall forecast to be 105% of the long-term common. India’s monsoon season runs from June via September.
Indicators of bigger international sugar output are unfavourable for costs. On Could 22, the USDA’s International Agricultural Service (FAS) predicted that Brazil’s 2025/26 sugar manufacturing would rise +2.3% y/y to a file 44.7 MMT. Additionally, India’s 2025/26 sugar manufacturing is projected to rise +25% y/y to 35.3 MMT, citing favorable monsoon rains and elevated sugar acreage. As well as, Thailand’s 2025/26 sugar manufacturing is anticipated to climb +2% y/y to 10.3 MMT.
In a bearish issue, the Indian authorities stated on January 20 that it will permit its sugar mills to export 1 MMT of sugar this season, easing the restrictions positioned on sugar exports in 2023. India has restricted sugar exports since October 2023 to take care of ample home provides. India allowed mills to export solely 6.1 MMT of sugar throughout the 2022/23 season to September 30, after permitting exports of a file 11.1 MMT within the earlier season. Nevertheless, the ISMA initiatives that India’s 2024/25 sugar manufacturing will fall -17.5% y/y to a 5-year low of 26.2 MMT. Additionally, the ISMA reported final Monday that India’s sugar manufacturing from Oct 1-Could 15 was 25.74 MMT, down -17% from the identical interval final 12 months. As well as, Indian Meals Secretary Chopra stated on Could 1 that India’s 2024/25 sugar exports might solely complete 800,000 MT, under earlier expectations of 1 MMT.
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.
Sugar costs have some assist from decreased sugar manufacturing in Brazil. Unica reported Monday that the cumulative 2025/26 Brazil Heart-South sugar output via mid-June is down by -14.6% y/y to 9.404 MMT. Final month, Conab, Brazil’s authorities crop forecasting company, stated 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.
The Worldwide Sugar Group (ISO) raised its 2024/25 international sugar deficit forecast to a 9-year excessive of -5.47 MMT on Could 15, up from a February forecast of -4.88 MMT. This means a tightening market following the 2023/24 international sugar surplus of 1.31 MMT. ISO additionally reduce its 2024/25 international sugar manufacturing forecast to 174.8 MMT from a February forecast of 175.5 MMT.
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 file 189.318 MMT and that international 2025/26 human sugar consumption would enhance +1.4% y/y to a file 177.921 MMT. The USDA additionally forecasted that 2025/26 international sugar ending shares would climb +7.5% y/y to 41.188 MMT.
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