**Sugar Market Update – July 6, 2023**
On July 6, 2023, July NY world sugar #11 closed up $0.13 (+0.97%) while August London ICE white sugar #5 closed down $0.10 (-0.02%). Sugar prices are consolidating above recent lows, supported by a reopening of the Strait of Hormuz which is expected to ease global supply disruptions and lower import costs for sugar.
However, concerns about weak monsoon rains in India, reported at 42% below normal, threaten the country’s sugarcane harvest, as the Indian Meteorological Department warns of the potential for the weakest monsoon in 11 years. This could significantly impact global sugar production, especially as other regions, including Brazil and Thailand, face similar weather concerns due to a confirmed El Niño pattern.
In Brazil, the sugar output is projected to decline by approximately 2.0% year-on-year as millers are prioritizing ethanol production, with current production at 6.838 million metric tons. As forecasts for the upcoming 2026/27 season indicate a global deficit of roughly 262,000 metric tons, the market outlook remains uncertain, particularly with the potential impact of the El Niño weather pattern.
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