October sugar prices fell to one-week lows on Tuesday, with NY world sugar #11 closing down 0.21% and London ICE white sugar #5 down 0.35%. This decline coincided with a significant drop in crude oil prices, which fell more than 4% on Tuesday and compounded a 7% drop from Monday. The downturn in oil prices may encourage sugar mills globally to produce more sugar instead of diverting cane for ethanol, potentially increasing sugar supplies.
Key projections for sugar production indicate a global deficit of 1.7 million metric tons for the 2026/27 season, an increase from an earlier estimate of a 550,000 metric ton deficit. This comes amid prospects of improved rainfall in India affecting sugar output, and concerns over an El Niño event that may limit rainfall in crucial sugar-producing countries like Brazil, India, and Thailand. India’s 2026/27 sugar production is forecasted to rise by 12% year-on-year to 33.6 million metric tons, driven by favorable conditions.
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