Might NY world sugar #11 (SBK26) in the present day is down -0.08 (-0.54%), and Aug London ICE white sugar #5 (SWQ26) is down -4.50 (-1.01%).
Sugar costs gave up an early advance in the present day and turned decrease after the USDA stated it expects a 2026/27 sugar surplus in India by 2.5 MMT, the primary surplus in two years. India is the world’s second-largest sugar producer.
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Sugar costs initially moved larger in the present day, with NY sugar posting a 3-week excessive and London sugar posting a 4-week excessive. Energy in gasoline costs is supportive for sugar, as gasoline (RBM26) surged to a 3.75-year excessive in the present day, boosting ethanol costs and doubtlessly persuading the world’s sugar mills to divert extra cane crushing towards ethanol manufacturing moderately than sugar, thus curbing sugar provides.
The motion by Brazil’s sugar mills to spice up ethanol manufacturing on the expense of sugar is supportive for sugar costs. Unica in the present day reported that 2026/27 Brazil Heart-South sugar manufacturing within the first half of April fell -11.9% y/y to 647 MT, with mills reducing the quantity of cane crushed for sugar manufacturing to 32.9% from 44.7% final yr. On Tuesday, Conab, in its preliminary report for the brand new sugar season, reported that 2026/27 Brazil sugar output will decline by -0.5% to 43,952 MT, whereas ethanol output will climb by +7.2% y/y to 29,259 million liters.
Sugar costs have been below stress for the previous 4 weeks, with NY sugar falling to a 5.5-year low within the nearest futures contract on April 17 amid expectations of plentiful world provides and tepid demand. The April 15 expiration of the Might London sugar contract noticed 472,650 MT of deliveries to settle the contract, probably the most for a Might contract in 14 years, an indication of tepid sugar demand.
Sugar costs additionally took successful earlier this month when India’s Meals Secretary stated the federal government has no plans to ban sugar exports this yr, easing issues that it might divert extra sugar to make ethanol following the Iran conflict disruption to crude oil provides. On February 13, India’s authorities accepted an extra 500,000 MT of sugar for export for the 2025/26 season, on high of the 1.5 MMT accepted in November. India launched a quota system for sugar exports in 2022/23 after late rain diminished manufacturing and restricted home provides.
The outlook for smaller Brazilian sugar output is supportive of costs. Final Tuesday, the USDA forecast Brazil’s 2026/27 sugar manufacturing at 42.5 MMT, down -3% y/y, citing millers crushing extra cane for ethanol than for sugar.
Indicators of a smaller world sugar surplus are additionally supportive for costs. Final Tuesday, Covrig Analytics minimize its 2026/27 world sugar surplus estimate to 800,000 MT from 1.4 MMT beforehand. Final Monday, sugar dealer Czarnikow minimize its 2026/27 world sugar surplus estimate to 1.1 MMT from 3.4 MMT in February, and minimize its 2025/26 surplus estimate to five.8 MT from 8.3 MMT.
Sugar costs even have some assist amid issues over provide disruptions from the continuing closure of the Strait of Hormuz. In response to Covrig Analytics, the closure of the strait has curbed roughly 6% of the world’s sugar commerce, constraining refined sugar output.
On April 16, India’s Nationwide Federation of Cooperative Sugar Factories Ltd. reported that India’s 2025-26 sugar manufacturing from Oct 1-Apr 15 was up +7.7% y/y to 27.48 MMT. On March 11, the Indian Sugar and Bio-energy Producers Affiliation (ISMA) projected India’s 2025/26 sugar manufacturing at 29.3 MMT, up 12% y/y, under an earlier projection of 30.95 MMT. The ISMA additionally minimize its estimate for sugar used for ethanol manufacturing in India to three.4 MMT from a July forecast of 5 MMT, which can permit India to spice up its sugar exports.
The Worldwide Sugar Group (ISO) on February 27 forecasted a +1.22 MMT (million metric ton) sugar surplus in 2025-26, following a -3.46 MMT deficit in 2024-25. ISO stated the excess is being pushed by elevated sugar manufacturing in India, Thailand, and Pakistan. ISO is forecasting a +3.0% y/y rise in world sugar manufacturing to 181.3 million MMT in 2025-26.
The USDA, in its bi-annual report launched on December 16, projected that world 2025/26 sugar manufacturing would climb +4.6% y/y to a file 189.318 MMT and that world 2025/26 human sugar consumption would improve +1.4% y/y to a file 177.921 MMT. The USDA additionally forecast that 2025/26 world sugar ending shares would fall by -2.9% y/y to 41.188 MMT. The USDA’s International Agricultural Service (FAS) predicted that Brazil’s 2025/26 sugar manufacturing would rise by 2.3% y/y to a file 44.7 MMT. FAS additionally predicted that India’s 2025/26 sugar manufacturing would improve by 25% y/y to 35.25 MMT, pushed by favorable monsoon rains and elevated sugar acreage. As well as, FAS predicted that Thailand’s 2025/26 sugar manufacturing will improve by +2% y/y to 10.25 MMT.
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