Sugar prices declined on Wednesday, extending recent losses amid expectations of strong global supplies. March New York world sugar futures closed 1.20% lower, while December London white sugar futures fell 2.37%. Despite the fall, prices remained above the lows recorded earlier in the week, reports Nasdaq.com.
On Tuesday, New York sugar hit a three-week low, and London sugar dropped to its lowest level in over four years. Analysts said the fall reflects expectations of abundant global supply. Earlier this week, BMI Group forecasted a global sugar surplus of 10.5 million metric tonnes (MMT) for 2025–26, while Covrig Analytics estimated a surplus of 4.1 MMT.
Sugar prices have been under pressure for the past seven months, with New York sugar futures hitting a four-and-a-half-year low last month following signs of increased output from Brazil. According to Unica, sugar production in Brazil’s Center-South region rose by 15.7% year-on-year in the first half of September to 3.62 million tonnes. The share of sugarcane crushed for sugar also increased to 53.49% in late August, compared to 47.74% a year earlier. However, total production through mid-September slipped slightly by 0.1% to 30.39 MMT.
Expectations of higher exports from India have added further pressure on prices. Favorable monsoon rains are likely to result in a strong harvest this year. The India Meteorological Department reported that rainfall during the June–September monsoon season was 8% above normal, the highest in five years. The National Federation of Cooperative Sugar Factories projected that India’s 2025–26 sugar production could rise by 19% to 34.9 MMT due to higher cane acreage, following a 17.5% decline in 2024–25 output to 26.2 MMT, as reported by the Indian Sugar Mills Association.
Meanwhile, sugar trader Sucden said India may divert about 4 MMT of sugar for ethanol production in 2025–26, which would not significantly reduce the surplus. As a result, the country’s mills might export up to 4 MMT, higher than earlier expectations of 2 MMT. India remains the world’s second-largest sugar producer.
Thailand’s output is also expected to rise. The Thai Sugar Miller Corporation projected that the country’s 2025–26 production will grow by 5% to 10.5 MMT, following a 14% increase in 2024–25 output to 10 MMT, according to the Office of the Cane and Sugar Board. Thailand is the third-largest producer and second-largest exporter of sugar globally.
Last week, New York sugar briefly hit a two-month high after reports indicated a drop in sugar content in Brazil’s cane crop, triggering short-term buying. Unica said the sugar content in the first half of September fell to 154.58 kilograms per tonne from 160.07 kilograms a year earlier.
The International Sugar Organization (ISO) expects a small global deficit of 231,000 tonnes in 2025–26, following a shortfall of 4.88 MMT in 2024–25. The ISO projects global production to rise by 3.3% to 180.6 MMT and consumption to increase slightly to 180.8 MMT.
The U.S. Department of Agriculture (USDA), in its May report, estimated that world sugar production in 2025–26 would reach a record 189.3 MMT, up 4.7% from the previous year. It also forecast global consumption to hit a record 177.9 MMT, with ending stocks rising by 7.5% to 41.2 MMT. The USDA’s Foreign Agricultural Service predicted record output from major producers — Brazil’s production rising 2.3% to 44.7 MMT, India’s output up 25% to 35.3 MMT, and Thailand’s production increasing 2% to 10.3 MMT.
