Sugar prices jump as rising oil market and El Nino concerns boost sentiment
Raw sugar futures on ICE rose 3.4% to 14.54 cents/lb, supported by higher oil prices from Middle East tensions and concerns that a strong El Niño could weaken India’s monsoon, threatening sugarcane production. White sugar also gained 2.3% to $448.40/tonne.
London: Raw sugar futures on ICE climbed sharply on Monday, supported by rising oil prices and growing concerns about the impact of a strong El Niño weather pattern on global sugar production.
Raw sugar gained 3.4 percent to 14.54 cents per pound by 1451 GMT, recovering after touching its lowest level since late April on Thursday, Reuters reported.
The rally came as oil prices moved higher following escalating tensions in the Middle East. Iran and the United States exchanged strikes, while Israel ordered troops to advance further into Lebanon.
Stronger oil prices are generally viewed as supportive for sugar markets because they can encourage sugar mills to divert more sugarcane toward ethanol production instead of sugar, reducing sugar supplies.
Market participants are also closely monitoring weather developments in India after the country forecast a weaker monsoon in 2026 due to El Niño conditions. The forecast points to the lowest rainfall in 11 years.
Broker ADMIS said that if the forecast materialises, it would result in the weakest monsoon since 2015. The firm added that traders are closely watching monsoon developments because of their potential impact on India’s sugarcane production.
In the white sugar market, prices also strengthened, with white sugar rising 2.3 percent to USD 448.40 per metric tonne.
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Source : ChiniMandi
