Sugar Prices Settle Higher as a Weak Dollar Spurs Short Covering

0 4 minutes read

Sugar Prices Settle Higher as a Weak Dollar Spurs Short.jpeg

October NY World Sugar #11 (SBV25) on Friday closed +0.13 (+0.80 %), and closed white sugar in London in London No. 5 (SWV25) +4.10 (+0.85 %).

Sugar prices stabilized on Friday after a decrease in the dollar index (DXY00) to a low drop for 3.5 weeks, short coverage in future sugar contracts.

On Wednesday, London sugar gathered to the highest level in 5 weeks on the signs of stronger global demand for sugar. Sugar imports in China in China +76 % rose to 740,000 metric tons, and Pakistan recently offered to 200,000 tons of refined sugar.

On Monday, sugar prices fell to their lowest levels for two weeks on the future of sugar mills in Brazil to increase production. Covrig Analytics said on Monday that Brazil’s sugar factories give priority to the production of sugar on ethanol, and to crush more sugar cane. This trend is expected to continue with the harvest of the peaks, driven by more dry cane crops that drive the mills to produce more sugar.

NY Sugar rose to the highest level in two months on Tuesday about concerns about the revenue of the weakest cane in Brazil. Last Friday, UNICA stated that the production of southern sugar in Brazil in the second half of July decreased by -0.8 % on an annual basis to 3614 metric tons, and the decrease in sugar product in the southern center 2025-26 during the month of July -7.8 % on an annual basis/p to 19,268 metric tons. However, the sugar cane percentage of sugar by sugar factories in Brazil increased in the second half of July to 54.10 % of 50.32 % at the same time last year. Also, Konab, the government predictor in Brazil, said last month that the production of sugar in Brazil 2024/25 by -3.4 % year on an annual basis to 44.118 MB, citing the low cane declines due to dryness and excessive heat.

The expectations for high sugar exports from India are negative for sugar prices after Bloomberg stated that India may allow the local sugar mills to export sugar in the next season, which begins in October, as abundant monsoon rains may produce the bumper sugar crop. The Meteorological Department of India said on Monday that the cumulative monsoon rain in India was 611.2 mm as of August 18, or 1 % higher than usual. Also, the Indian Biological and Biological Factors Association said it would seek permission to export 2 million tons of sugar in 2025/26.

The expectations for high sugar production in India, the second largest producer in the world, are downward. On June 2, the National Union of Cooperative Diabetes expected that sugar production in India 2025/26 in India will climb +19 % on an annual basis to 35 million tons, citing a larger cane area. This would follow a decrease in the production of sugar in India -17.5 % in 2024/25 to the lowest level of 5 years of 26.2 million tons, according to the Indian Sugar Mills Association (ISMA).

Sugar prices fell to early July, as sugar in New York fell to a low decrease in sugar for 4.25 years to the lowest level in London to a 4 -year low level, driven by sugar surplus expectations in the 2025/26 season. On June 30, the CZANIKOW commodity dealer expected a global surplus of global sugar 7.5 million tons for the 2025/26 season, which is the largest surplus in 8 years. On May 22, the US Department of Agriculture expected, in its classic report, that the production of global sugar 2025/26 will increase by +4.7 % on an annual basis to 189.318 million tons, as global sugar ends in 41.188 million tons, an increase of 7.5 % on an annual basis.

Expectations for high sugar production in Thailand are low for sugar. On May 2, the Thailand office in sugar cane and sugar reported that the production of sugar 2024/25 from Thailand increased +14 % year on an annual basis to 10.00 million tons. Thailand is the third largest sugar producer in the world and the second largest sugar exporter.

The International Sugar Organization (ISO) raised the forecasts of the World Sugar deficit for the year 2024/25 to the highest level in 9 years of -5.47 million tons on May 15, up from February -88 m This indicates a tightening market after the global sugar surplus 2023/24 of 1.31 million tons. ISO has also reduced the forecast of international sugar production for the year 2024/25 to 174.8 million tons of February forecast 175.5 million tons.

The US Department of Agriculture expected, in its annual bilateral report, which was released on May 22, that the production of global sugar 2025/26 will increase +4.7 % on an annual basis to 189.318 million metric tons, and that global sugar consumption 2025/26 will increase +1.4 % on an annual basis to 177.921 million tons. The US Department of Agriculture also expected that the storage of 2025/26 global sugar would climb +7.5 % year on year to 41.188 million tons. Foreign Agricultural Service in the US Department of Agriculture (FAS) predicted that the production of sugar in Brazil 2025/26 will rise +2.3 % year on year to 44.7 million metric tons in India, the production of sugar in India 2025/26 will increase. FAS expected that the production of sugar 2025/26 from Thailand will climb +2 % on an annual basis to 10.3 million tons.

On the date of publication, Rich Asplund did not have positions (either directly or indirectly) in any of the securities mentioned in this article. All information and data in this article are only for media purposes. This article was originally published on Barchart.com

2025-08-22 18:28:00

0 4 minutes read