On October 6, 2023, sugar prices rose sharply, with October NY world sugar #11 (SBV26) increasing by +0.32 (+2.15%) and August London ICE white sugar #5 (SWQ26) up by +0.20 (+0.04%). This surge is attributed to a rally in the Brazilian real, which is currently at a 2-week high, discouraging export sales from Brazil’s sugar producers.
Concerns about weakened monsoon rains in India are driving market apprehensions regarding sugar yields. As of July 6, cumulative monsoon rainfall in India is reported to be 20% below normal, with forecasts suggesting this year’s monsoon could be the weakest in 11 years. Additionally, Brazil’s sugar production is expected to decline, with Unica reporting a 2.0% year-over-year decrease in the 2026/27 season due to increased ethanol production.
The USDA’s latest projections indicate that global sugar production could face a deficit of -262,000 MT in 2026/27, as international weather patterns, including an emerging El Niño, threaten crops in major sugar-producing regions such as India and Thailand.
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