May NY World Sugar #11 (SBK26) closed up +0.02 (+0.14%) on Monday, and May London ICE White Sugar #5 (SWK26) closed +5.90 (+1.45%).
Sugar prices rose on Monday, supported by higher crude oil prices. WTI crude oil (CLJ26) rose more than +6% to a 8.25-month high on Monday, which benefited ethanol prices and may encourage global sugar producers to increase sugar crushing to produce ethanol instead of sugar, thus reducing sugar supply.
On February 12, sugar prices fell to 5.25-year near-term lows on concerns that the world sugar glut will continue. On February 11, analysts at sugar trader Czarniko said they expected a global sugar addition of 3.4 MMT in the 2026/27 crop year, after a surplus of 8.3 MMT in 2025/26. Also, Greenpool Commodity Specialists said on January 29 that they expect a global sugar surplus of 2.74 MMT for 2025/26 and a surplus of 156,000 MT for 2026/27. Meanwhile, StoneX said on February 13 that it expects a global sugar surplus of 2.9 MMT in 2025/26.
Last Friday, the International Sugar Organization (ISO) forecast a sugar surplus of +1.22 MMT (million metric tons) in 2025-26, below the previous forecast of +1.63 MMT. This follows a deficit of -3.46 MMT in 2024-25. The additional surplus is due to increased sugar production in India, Thailand and Pakistan, the ISO said. ISO forecasts world sugar production to increase +3.0% y/y to 181.3 million MMT in 2025-26.
Signs of lower sugar production in Brazil are supporting sugar prices, after Unica reported on February 18 that sugar production in central-south Brazil fell 36% y/y to just 5,000 MT in the second half of January. However, aggregate sugar production for the 2025-26 Centre-South rose by 0.9% y/y to 40.24 MMT in January. Also, the ratio of potato to wheat for sugar increased to 50.74% in 2025/26 from 48.14% in 2024/25.
Consulting firm Safras & Mercado said on Dec. 23 that Brazil’s sugar production will fall -3.91% to 41.8 MMT in 2026/27 from an expected 43.5 MMT in 2025/26. The company expects Brazil’s sugar exports to decline -11% y/y to 30 MMT in 2026/27.
India’s 2025-26 sugar production increased by +12% y/y to 24.75 MMT from October 1 to February 28, the Indian Sugar and Bioenergy Manufacturers Association (ISMA) reported today. Last Wednesday, ISMA estimated India’s 2025/26 sugar production at 29.3 MMT, up 12% y/y, down from the previous estimate of 30.95 MMT. The ISMA also cut its estimate of sugar used for ethanol production in India to 3.4 MMT from the July 5 MMT forecast, which may allow India to boost its sugar exports. India is the second largest producer of sugar in the world.
