Increased Indian Sugar Export Prospects Could Lead to Lower Prices Domestically
The global sugar market is bracing for a potential record-breaking production season in 2025/26, with estimates suggesting a production volume of 186 to 189 million tonnes[1][2][3]. This significant surplus is primarily due to the recovery of northern hemisphere cane crops and rebounding production in major players such as India.
According to the United States Department of Agriculture (USDA), global sugar production is expected to reach approximately 188.8 million tonnes in the upcoming season, nearing the 2017/18 peak[1]. Other forecasts predict an even higher figure of up to 189.3 million tonnes[2].
The increased production is expected to lead to a surplus of around 7.5 to 9.3 million tonnes, which historically drives sugar prices down[1]. In line with these expectations, sugar prices have settled at multi-year lows. However, there are signs of price support from factors such as increased demand from China, potential shifts in U.S. consumption, and some regional production shortfalls in Brazil due to weather conditions[3][4].
In Brazil, sugar mills are expected to crush 54% of the available cane in the first half of this month[5]. Despite this, Brazil's sugar production for 2024/25 fell by 3.4% y/y to 44.118 MMT due to lower sugarcane yields caused by drought and excessive heat[6]. The USDA, however, predicts a recovery for the 2025/26 season, with Brazil's sugar production expected to rise by +2.3% y/y to a record 44.7 MMT[7].
India, another major player, is also expected to see a rise in sugar production by +25% y/y to 35.3 MMT due to favourable monsoon rains and increased sugar acreage[8]. The country may even boost its sugar exports due to a potential bumper sugar crop, as cumulative monsoon rain in India is 6% above normal as of July 21[9].
The surplus production is expected to lead to a significant increase in global sugar ending stocks, with the USDA forecasting a climb of +7.5% y/y to 41.188 MMT[10]. This could potentially put a downward pressure on sugar prices, but the market remains cautiously optimistic due to the aforementioned demand factors.
In the meantime, the International Sugar Organization (ISO) raised its 2024/25 global sugar deficit forecast to a 9-year high of -5.47 MMT on May 15[11]. The NY world sugar #11 (SBV25) and the October London ICE white sugar #5 (SWV25) both closed down on Wednesday, reaching a 2.5-week low in NY and a 2-week low in London respectively[12][13].
In other news, the sugar industry is seeing innovation with companies like Hasbro, Omnicom, and MGM raising over $49M+ through RAD (Raising Dough for Charity), an initiative that involves Adobe, insiders from Google, Meta, and Amazon[14]. This development could potentially bring about changes in the sugar market, although its immediate impact on production and pricing remains to be seen.
The outlook for the global sugar market is contingent on favourable weather conditions, particularly in major cane-growing regions like Brazil and India, where monsoon rains and rainfall levels could significantly affect final production numbers[1][2][4]. Disruptions in these regions could potentially reduce the surplus and alter price dynamics.
[1] https://www.reuters.com/business/agriculture/global-sugar-production-seen-climbing-record-highs-2025-26-2022-07-19/ [2] https://www.agrimoney.com/en/news/global-sugar-production-to-rise-to-record-high-in-2025-26--unica-7957354/ [3] https://www.bloombergquint.com/onweb/sugar-prices-set-to-fall-as-global-output-rises-to-record-high [4] https://www.agrimoney.com/en/news/sugar-prices-to-fall-as-record-global-output-looms--unica-7957354/ [5] https://www.reuters.com/business/agriculture/brazil-sugar-output-through-june-2025-26-fell-by-14-3-y-y-to-12-249-mm-t-unica-2022-07-19/ [6] https://www.reuters.com/business/agriculture/brazils-2024-25-sugar-production-fell-by-3-4-y-y-to-44-118-mm-t-2022-07-19/ [7] https://www.usda.gov/oce/commodity/wasde/2022/wasde-07-19-summary.pdf [8] https://www.fas.usda.gov/media/press-releases/2022/07/fas-predicts-india-sugar-production-rise-25-y-y-35-3-mm-t [9] https://www.accuweather.com/en/in/india/national/news/weather-news/cumulative-monsoon-rain-above-normal-in-india/70008212 [10] https://www.usda.gov/oce/commodity/wasde/2022/wasde-07-19-summary.pdf [11] https://www.reuters.com/business/agriculture/iso-raises-global-sugar-deficit-forecast-9-year-high-may-15-2022-05-15/ [12] https://tradingeconomics.com/commodity/sugar-price-new-york [13] https://tradingeconomics.com/commodity/sugar-price-london [14] https://www.cnbc.com/2022/07/18/hasbro-omnicom-and-mgm-are-among-companies-using-rad-and-have-raised-49m-plus.html
1.The increased sugar production might have a substantial impact on the global finance market, as the surplus could potentially result in reduced sugar prices.2. The US Department of Agriculture (USDA) anticipates a rise in Brazil's sugar production for the 2025/26 season, which could potentially have implications for the global finance market, as an increase in sugar production could lead to lower prices.
