Global sugar prices fall 5.7% in June as brazil’s ethanol market weighs on prices: FAO
The FAO Sugar Price Index fell 5.7% in June as lower Brazilian ethanol prices and a weaker Brazilian real weighed on global sugar markets. The decline was partially offset by concerns that El Niño could reduce sugar production in India and Thailand, limiting further price weakness.
International sugar prices fell sharply in June as weaker ethanol prices in Brazil and the depreciation of the Brazilian real pushed global sugar quotations lower, according to the latest Food and Agriculture Organization (FAO) Food Price Index.
The FAO Sugar Price Index declined by 5.7% from May, making sugar one of the biggest contributors to the overall decline in global food commodity prices. However, concerns over the potential impact of El Niño on sugar production in India and Thailand limited the fall in international sugar prices.
Overall, the FAO Food Price Index averaged 130.3 points in June, down 0.3% from May, although it remained 2.2% higher than the same month last year. The decline was driven by lower prices for cereals, sugar and dairy products, which offset increases in vegetable oil and meat prices.
FAO said international maize and wheat prices also declined during the month, with weaker ethanol demand contributing to a 6.2% fall in global maize prices. Wheat prices dropped 4.4% due to favourable harvest prospects in the Black Sea region, while rice prices rose 3.2% on stronger demand from Asia.
The Vegetable Oil Price Index increased by 3.8%, supported by stronger mandated biofuel demand that lifted palm and rapeseed oil prices. Meat prices rose 0.5% to a record high, while the Dairy Price Index fell 1.5% as export supplies continued to exceed global demand.
Commenting on the latest trends, FAO Markets and Trade Division Director Boubaker Ben-Belhassen said international food commodity markets continue to react differently to changing global conditions. He stressed that transparent markets, timely information and predictable global trade remain essential for strengthening food security and the resilience of agrifood systems.
In its latest Cereal Supply and Demand Brief, FAO forecast global cereal production at 2.983 billion tonnes in 2026, making it the second-highest harvest on record, although 1.9% below last year’s peak.
Global wheat production is projected to decline by 4.3% to 806.5 million tonnes, with El Niño expected to reduce Australia’s harvest below its five-year average. World rice production is also forecast to decline by 1.8% from the record level achieved in 2025/26.
The agency also lowered its forecast for global cereal utilisation in 2026/27 due to weaker wheat consumption, while projecting world cereal stocks at 957.8 million tonnes by the end of the 2027 season.
Separately, FAO’s Global Information and Early Warning System estimated that 41 countries and territories currently require external food assistance, with conflict, insecurity and El Niño-related weather conditions continuing to threaten food production in several regions, particularly across Africa.
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Source : ChiniMandi
