On Thursday, May New York world sugar (#11) closed at $15.80 per pound, up 2.06%, reaching a 5.5-month high, while May London ICE white sugar (#5) increased by 1.23% to $462.50 per metric ton. This surge in sugar prices was influenced by a 4% rise in crude oil prices, which can lead to increased ethanol production and decreased sugar output from global mills.
Analysts project a global sugar surplus of 3.4 million metric tons (MMT) for the 2026/27 crop year, following an 8.3 MMT surplus for 2025/26, with key production increases expected from India, Thailand, and Pakistan. Additionally, the Indian Sugar and Bio-energy Manufacturers Association reported a 10.5% year-on-year increase in India’s sugar output for the October 1 to March 15 period, totaling 26.2 MMT.
As the closure of the Strait of Hormuz affects about 6% of the world’s sugar trade, concerns over refined sugar output are supported. Simultaneously, Brazil’s recent production drop of 36% year-on-year highlights potential supply challenges, despite a cumulative increase in production through January.
