Sugar Prices Recover Amid Strength in the Brazilian Real

March NY world sugar #11 (SBH26) as we speak is up +0.02 (+0.14%).  March London ICE white sugar #5 (SWH26) is up +1.90 (+0.45%).

Sugar costs recovered from early losses as we speak and are barely increased as energy within the Brazilian actual prompted some brief protecting in sugar futures.  The actual (^USDBRL) climbed to a 1-month excessive in opposition to the greenback as we speak, discouraging export gross sales from Brazil’s sugar producers.

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Final Friday, sugar costs fell to 2-week lows on indicators of stronger sugar output in India.  The India Sugar Mill Affiliation (ISMA) final Thursday reported that Indian sugar manufacturing for 2025-26, from October 1 to December 31, jumped 25% y/y to 11.90 MMT from 9.54 MMT the identical time final yr.  Additionally, the ISMA on November 11 raised its 2025/26 India sugar manufacturing estimate to 31 MMT from an earlier forecast of 30 MMT, up +18.8% y/y.  The ISMA additionally reduce its estimate for sugar used for ethanol manufacturing in India to three.4 MMT from a July forecast of 5 MMT, which can permit India to spice up its sugar exports.  India is the world’s second-largest sugar producer.

Sugar costs have been below strain amid prospects of upper sugar exports from India, after India’s meals secretary mentioned the federal government might allow extra sugar exports to scale back a home provide glut.  In November, India’s meals ministry mentioned it might permit mills to export 1.5 MMT of sugar within the 2025/26 season.  India launched a quota system for sugar exports in 2022/23 after late rain diminished manufacturing and restricted home provides.

Final Monday, NY sugar matched a 2.5-month excessive on expectations of smaller future sugar provides from Brazil.  Consulting agency Safras & Mercado mentioned on December 23 that Brazil’s sugar manufacturing in 2026/27 will fall by -3.91% to 41.8 MMT from 43.5 MMT anticipated in 2025/26.  The agency expects Brazil’s sugar exports in 2026/27 to fall -11% y/y to 30 MMT.

The outlook for file sugar output in Brazil is bearish for costs.  Conab, Brazil’s crop forecasting company, on November 4 raised its Brazil 2025/26 sugar manufacturing estimate to 45 MMT from a earlier forecast of 44.5 MMT.  Unica reported on December 16 that Brazil’s cumulative 2025-26 Heart-South sugar output via November rose by +1.1% y/y to 39.904 MMT.  Additionally, the ratio of cane crushed for sugar rose to 51.12% in 2025/36 from 48.34% in 2024/25.

On the bearish aspect for sugar, the Worldwide Sugar Group (ISO) on November 17 forecast a 1.625 million MT sugar surplus in 2025-26, following a 2.916 million MT deficit in 2024-25.  ISO mentioned the excess is being pushed by elevated sugar manufacturing in India, Thailand, and Pakistan.  ISO is forecasting a +3.2% y/y rise in world sugar manufacturing to 181.8 million MT in 2025-26.  In the meantime, sugar dealer Czarnikow on November 5 boosted its world 2025/26 sugar surplus estimate to eight.7 MMT, up +1.2 MMT from a September estimate of seven.5 MMT.

The outlook for increased sugar manufacturing in Thailand is bearish for costs.  The Thai Sugar Millers Corp on October 1 projected that Thailand’s 2025/26 sugar crop will enhance by +5% y/y to 10.5 MMT.  Thailand is the world’s third-largest sugar producer and the second-largest exporter.

The USDA, in its bi-annual report launched on December 16, projected that world 2025/26 sugar manufacturing would climb +4.6% y/y to a file 189.318 MMT and that world 2025/26 human sugar consumption would enhance +1.4% y/y to a file 177.921 MMT.  The USDA additionally forecast that 2025/26 world sugar ending shares would fall by -2.9% y/y to 41.188 MMT.  The USDA’s International Agricultural Service (FAS) predicted that Brazil’s 2025/26 sugar manufacturing would rise by 2.3% y/y to a file 44.7 MMT.  FAS additionally predicted that India’s 2025/26 sugar manufacturing would enhance by 25% y/y to 35.25 MMT, pushed by favorable monsoon rains and elevated sugar acreage.  As well as, FAS predicted that Thailand’s 2025/26 sugar manufacturing will enhance by +2% y/y to 10.25 MMT. 

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