ARTICLE 2 #Sugar Market

Global sugar markets have been locked in a tight trading band over the past few weeks, as international sugar prices hover around 16 to 17 cents per pound. With few immediate catalysts, traders and analysts say this range may persist — unless something shifts the balance.

The Food Ministry has allocated a domestic sugar quota of 24 lakh metric tonnes (LMT) for October 2025, starting from October 1. This is lower than the 25.5 LMT quota allocated for October 2024, though higher than September 2025’s quota of 23.5 LMT. Market watchers expect firm demand (especially with upcoming festivals) and foresee a price rise of ₹40‑50 per quintal in many regions.

Raw sugar deliveries for the October contract on the ICE (Intercontinental Exchange) were estimated at around 30,032 lots, equivalent to approximately 1.52 million metric tons, according to preliminary data shared by two sugar traders on Tuesday, September 30. The contract expired on the same day.

March NY world sugar #11 (SBH26) on Wednesday closed down -0.47 (-2.83%), and December London ICE white sugar #5 (SWZ25) closed down -15.50 (-3.31%).Sugar prices sold off sharply on Wednesday, with London sugar posting a 1-week low. The outlook for higher sugar production in Thailand is undercutting sugar prices after the Thai Sugar Miller Corp on Wednesday projected that Thailand's 2025/26 sugar crop will increase by +5% y/y to 10.5 MMT. Thailand is the world's third-largest sugar producer and the second-largest exporter of sugar.

Sugar prices settled sharply higher on Thursday due to concerns over lower sugarcane yields in Brazil. Unica reported Thursday that Brazil's Center South sugarcane crush in the first half of September was up +6.9% y/y to 46 MMT. However, the sugar content in the cane declined, signaling lower sugar production as the sugar content in crushed cane dropped to 154.58 kilogram per ton (kg/ton) versus 160.07 kg/ton a year earlier.

March NY world sugar #11 (SBH26) on Friday closed up +0.07 (+0.431%), and December London ICE white sugar #5 (SWZ25) closed down -1.20 (-0.26%). Sugar prices settled mixed on Friday.

A major shift is coming to how the UAE taxes sweetened beverages. Beginning 1 January 2026, the country will move from a flat excise tax system to a tiered, sugar‑content‑based model for drinks.