On July 14, 2023, sugar prices surged with NY world sugar #11 closing up 2.33% to a 3.5-week high at +0.34, while August London ICE white sugar #5 increased by 1.73% to +7.60. This rise is attributed to concerns that elevated gasoline prices will lead sugar mills to favor ethanol production over sugar, thereby tightening sugar supplies.
Green Pool Commodity Specialists revised their forecast for a global sugar deficit in the 2026/27 season to -4.30 million metric tons (MMT), increased from -1.66 MMT. Brazil’s sugar production in early April dropped by 11.9% year-on-year to 647 MMT as mills reduced cane crushed for sugar from 44.7% to 32.9%. Concurrently, ethanol production in Brazil is expected to climb by 7.2% to 29.259 million liters.
With supply disruptions predicted due to the ongoing closure of the Strait of Hormuz affecting around 6% of the global sugar trade, and the USDA estimating Brazil’s 2026/27 sugar production will decrease by 3% to 42.5 MMT, the outlook for global sugar prices remains steadily supported.
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