rewrite this title and make it good for SEOSugar Prices Fall as Brazil Frost Risks Recede

In a bearish factor, the Indian government said on January 20 that it would allow its sugar mills to export 1 MMT of sugar this season, easing the restrictions placed on sugar exports in 2023.  India has restricted sugar exports since October 2023 to maintain adequate domestic supplies.  India allowed mills to export only 6.1 MMT of sugar during the 2022/23 season to September 30, after allowing exports of a record 11.1 MMT in the previous season.  However, the ISMA projects that India’s 2024/25 sugar production will fall -17.5% y/y to a 5-year low of 26.2 MMT.  Also, the ISMA reported last Monday that India’s sugar production from Oct 1-May 15 was 25.74 MMT, down -17% from the same period last year.  In addition, Indian Food Secretary Chopra said on May 1 that India’s 2024/25 sugar exports may only total 800,000 MT, below earlier expectations of 1 MMT.

The outlook for higher sugar production in Thailand is bearish for sugar prices.  On May 2, Thailand’s Office of the Cane and Sugar Board reported that Thailand’s 2024/25 sugar production rose +14% y/y to 10.00 MMT.  Thailand is the world’s third-largest sugar producer and the second-largest exporter of sugar.

Sugar prices have some support from reduced sugar production in Brazil.  Unica reported Monday that the cumulative 2025/26 Brazil Center-South sugar output through mid-June is down by -14.6% y/y to 9.404 MMT.  Last month, Conab, Brazil’s government crop forecasting agency, said 2024/25 Brazil sugar production fell by -3.4% y/y to 44.118 MMT, citing lower sugarcane yields due to drought and excessive heat.

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, up from a February forecast of -4.88 MMT.  This indicates a tightening market following the 2023/24 global sugar surplus of 1.31 MMT.  ISO also cut its 2024/25 global sugar production forecast to 174.8 MMT from a February forecast of 175.5 MMT.

The USDA, in its bi-annual report released May 22, projected that global 2025/26 sugar production would climb +4.7% y/y to a record 189.318 MMT and that global 2025/26 human sugar consumption would increase +1.4% y/y to a record 177.921 MMT.  The USDA also forecasted that 2025/26 global sugar ending stocks would climb +7.5% y/y to 41.188 MMT.

On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com