Sugar jumps to highest in nearly three weeks on supply outlook
Sugar futures surged to a nearly three-week high as production estimates were revised down for top producers Brazil and India. India’s lower-than-expected output raised concerns about meeting export quotas, while analysts warned that reduced production could impact exports in the 2025-26 season. Additionally, dry weather in Brazil’s key growing regions has led to lowered cane harvest projections, threatening the global surplus forecast for the upcoming season.
Sugar futures climbed to the highest in almost three weeks with some production estimates scaled back in the world’s top growers Brazil and India.
After industry estimates pointed to lower-than-expected output in second-largest producer India, concerns emerged over the country’s capacity to keep exports going. Authorities allowed shipments of as much as 1 million tons this season.
The smaller crop raises questions on how the country will ll the current export quota, analysts at StoneX wrote in a Monday note. There’s also concern on how “production in the next cycle could be used to replenish stocks, reducing the export potential” in the upcoming 2025-26 season, the analysts added.
The most-active raw sugar contract in New York climbed as much as 3.7%, to the highest since Feb. 26, before trimming gains.
Dry weather in top supplier Brazil has also resulted in some producers and traders lowering estimates for the cane harvest in the season that starts in April. That could threaten forecasts for the global market to nally return to a surplus in the next season. “The focus seems to be switching to how badly several big northern hemisphere crops are faring late in their harvests, while optimism regarding the coming CS Brazil cane crop seems to be drying up,”
Green Pool Commodity Specialists wrote in a note, referring to Brazil’s Center South growing region.
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Source : Economic Times
