Sugar prices are on the rise, with NY sugar hitting a 4-week high and London sugar reaching a 1.5-week high. Dollar weakness and strong global demand, evidenced by Pakistan ordering 320,000 MT of sugar, are boosting prices. However, projections of abundant global sugar supplies and a potential surplus in India could weigh on prices.

Brazil’s higher sugar output is pressuring prices, with an 18% y/y increase in sugar production reported. Despite this, cumulative sugar output through August fell slightly y/y. India’s potential diversion of 4 MMT of sugar to ethanol and increased exports may exacerbate the surplus. The International Sugar Organization forecasts a global sugar deficit for the upcoming season.

Expectations of a significant global sugar surplus for the 2025/26 season may impact prices negatively. Projections indicate record-high sugar production levels and increased ending stocks globally. India’s strong monsoon rains and expected rise in sugar production could further contribute to the surplus. Brazil’s sugar production estimates have been adjusted downwards.

Thailand’s increased sugar production and Brazil’s revised production estimates are key factors influencing the sugar market. Global projections suggest a rise in production and consumption, leading to higher ending stocks for the 2025/26 season. Forecasts indicate record production levels for major sugar-producing countries, which could contribute to a surplus.

Read more at Yahoo Finance: Sugar Rallies on Dollar Weakness and Strong Demand from Pakistan