On March 7, 2023, New York world sugar #11 (SBH26) increased by 0.56% to a 2.5-week high, while May London ICE white sugar #5 (SWK26) rose by 0.05%. This surge is attributed to a stronger Brazilian real, reaching a 1.75-year high against the dollar, which is discouraging sugar exports from Brazil.
Recent data reveals that funds increased their net short positions in NY sugar futures to a record 265,324, suggesting potential for a short-covering rally. In Brazil, sugar production in the Center-South during the second half of January fell by 36% year-over-year, with a cumulative annual production of 40.24 million metric tons (MMT), up 0.9% year-over-year.
Looking ahead, consulting firm Safras & Mercado projects a decline in Brazil’s 2026/27 sugar production by 3.91% to 41.8 MMT, while India’s output is expected to increase significantly, driven by favorable monsoon rains. The USDA forecasts global sugar production will rise by 4.6% to a record 189.318 MMT for the 2025/26 crop year.
