Close up a sugar cubes on wooden spoon on the table
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towfiqu ahamed
Global sugar prices topped 15 US cents a pound on InterContinental Exchange, New York, on Monday as traders feared the market could face a deficit. However, a few analysts project a fall in global sugar prices during the current quarter and the next due to easing geopolitical tensions and stronger-than-expected supplies.On the other hand, the ongoing El Nino weather and renewed geopolitical tensions pose risks to production and supplies, they said. On Tuesday, October sugar contracts in New York were quoted at 15.10 cents per pound ($331/tonne). In London, white sugar ruled at $475.50 a tonne for October delivery.Covrig Analytics pegged the sugar deficit at 3 lakh tonnes compared with its earlier projection of 1 lakh tonne surplus. Another analytical firm, Green Pool Commodity Specialists, has pegged the deficit at 3.3 million tonnes (mt) from an earlier estimate of 1.76 mt. Q3 price outlookResearch agency BMI, a unit of Fitch Solutions, expects sugar prices to average 15.2 cents a pound, up from 14.6 cents in Q1 and 14.2 cents in Q2.“We are revising our 2026 average price forecast for front-month ICE-listed #11 raw sugar futures to 14.9 cents per lb, representing a year-on-year decline of 11.3 per cent,” it said.Prices found support in late Q1 and early Q2 from the US-Iran conflict and the consequent rise in global energy prices, reaching a year-to-date high of 15.9 cents a pound on March 24, from which prices have since retreated by 8.8 per cent as of July 29, it said.ING Think, the economic and financial analysis wing of Dutch multinational financial services firm ING, said in its 2026 sugar outlook that raw sugar prices will average 15.40 cents per pound this year, with the third quarter the weakest as it is the peak of the CS Brazil harvest.Narrowing surplusThe US Department of Agriculture in its “Sugar: Markets and Trade” said global sugar production is forecast lower by 1.2 million tonnes to 184.9 million in the 2026-27 season starting October, with lower production in Brazil, the European Union, the US and Thailand BMI expects the global production surplus to narrow to 2.8 mt in the 2026-27 season, down from 7 mt in 2025-26. “Underpinning this is our forecast of a 2.3 per cent year-on-year decline in production to 182.4 mt, while consumption is expected to hold steady at 179.6 mt,” it said.ING Think said the sugar surplus this season is the highest since 2017-18.BMI expects Brazil’s output to reach 42.0 mt in the 2026-27 season, down 4.1 per cent year-on-year. “We expect Indian sugar production to reach 33.0 mt in the 2026/27 season, up 10.0 per cent year-on-year, though risks are weighted to the downside, the principal concern being a strengthening El Nino,” it said. Thailand may rescue“While our projections do point to a tighter market balance, and we note that relatively small downward revisions could tip the market into deficit, we caution against viewing the global sugar market as ‘tight’.” it said. The USDA has projected opening global stocks for the 2026-27 season at 43.5 mt, up 3.0 per cent year-on-year.BMI said Thailand’s 13.3 mt stocks will help overcome any impact of El Nino weather on global supplies.It said the risk to its price outlook was the US-Iran conflict, which could prolong till the fourth quarter. Higher crude oil prices could divert more sugar in Brazil towards ethanol.Published on August 5, 2026
