Sugar Futures at 1-Week High

2026-05-20 14:29 By Luisa Carvalho 1 min. read

Sugar futures in the US traded slightly above 15 US cents, the highest in a week, reflecting concerns over the upcoming season and expectations of increased demand for biofuels.

The International Sugar Organization (ISO) new estimates indicated a larger 2025/26 global sugar surplus of 2.244 million tons, compared with 1.22 million previously.

However, it projected global sugar production in 2026/27 to fall 1.15% year-on-year to 180 MMT, resulting in a 262,000 MT deficit, citing potential El Niño-driven disruptions in India and Thailand.

Ethanol production is forecast to rise from 123.1 to 129.4 billion litres in 2026, supported by a recovery in Brazil and expansion in India, with consumption at 126.9 billion litres, still below output.

Meanwhile, Brazil’s fuel subsidies to offset higher gasoline and diesel prices from the Iran conflict are expected to support ethanol, potentially shifting sugar mills toward ethanol production.



News Stream
Sugar Futures at Over 1-Month Low
US sugar futures extended their downward trend to trade around 18.5 cents per pound, the lowest since September, driven by a combination of a weaker Brazilian real, fund selling and lower oil prices. Higher output from India added to the pressure. According to a major industry body, sugar production in the world's second-largest producer jumped by 745% yoy to 845,000 in October, as mills in Maharashtra brought forward the start of the crushing season to build stocks ahead of the festive period. In Brazil, however, sugarcane crushing and sugar production fell during the first half of October, as persistent rainfall across the Center-South disrupted harvesting and delayed mill operations. The El Niño appears to be affecting the region earlier than expected, with excessive rainfall complicating production prospects and raising uncertainty over the start of the next harvest. The global supply outlook remains constrained by weather uncertainty, with a potential deficit looming in 2026/27.
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Sugar Futures Hover Around 1-Month Low
US sugar futures eased to around 19.3 cents per pound, nearing their lowest since early October, pressured by a weaker Brazilian real and as the market consolidated following recent supply-driven gains. The devaluation of the real tends to favor Brazilian exports, as sellers can obtain more returns for each dollar received in foreign sales. Meanwhile, recent data showed that sugarcane crushing and sugar production in Brazil declined during the first half of October, as persistent rainfall across the Center-South disrupted harvesting and delayed mill operations. El Niño appears to be affecting the region earlier than expected, with excessive rainfall complicating production prospects and raising uncertainty over the start of the next harvest. Forecasts of further precipitation could prolong these disruptions, further limiting crushing activity and weighing on output. Lower production prospects in India and reduced planting in Europe are adding to concerns over global availability.
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