**Sugar Prices Surge Amid Rising Crude Oil Costs**
On Friday, May NY world sugar #11 (SBK26) closed at $14.05 per pound, up 2.77%, while May London ICE white sugar #5 (SWK26) rose to $414.60 per tonne, an increase of 1.97%. This surge was influenced by WTI crude oil (CLJ26) soaring 12.5% to a 2.5-year high, prompting fears that sugar mills may shift production from sugar to ethanol, potentially reducing sugar supplies.
Analysts project a global sugar surplus of 3.4 million metric tons (MMT) for the 2026/27 crop year, following an anticipated 8.3 MMT surplus in 2025/26. The International Sugar Organization (ISO) forecasts a 1.22 MMT surplus for 2025-26, attributing this to increased sugar output in India, Thailand, and Pakistan. Meanwhile, Brazil’s Center-South region reported a 36% year-over-year drop in sugar production for the second half of January, raising concerns about supply constraints.
