On Friday, October NY world sugar #11 (SBV25) closed up 0.31 (1.91%), while August London ICE white sugar #5 (SWQ25) rose by 1.20 (0.25%). This price increase followed a sharp rally in crude oil prices, driven by speculation regarding potential new sanctions on Russian oil exports by President Trump, which may lead sugar mills to shift production from sugar to ethanol due to higher crude prices.
Key developments include Pakistan’s decision to import 500,000 metric tons (MT) of sugar and the Philippines’ plan to import 424,000 MT. Earlier predictions indicated a global sugar surplus of 7.5 million metric tons (MMT) for the 2025/26 season, marking the largest surplus in eight years. Additionally, India’s sugar production for 2025/26 is projected to rise by 19% year-on-year to 35 MMT due to favorable weather, while Brazil’s production is expected to increase by 2.3% to a record 44.7 MMT.
Currently, reduced sugar production in Brazil offers some price support; cumulative 2025/26 Brazil Center-South sugar output is down 14.6% year-on-year to 9.404 MMT amidst a drought and excessive heat. The International Sugar Organization recently raised its global sugar deficit forecast for 2024/25 to a nine-year high of -5.47 MMT, signaling tightening market conditions following a surplus in 2023/24.
