The U.S. Department of Agriculture’s (USDA) biannual report predicts global sugar production will rise ~4.7% year-on-year to a record 189.318 million metric tons (MMT). Ending stocks are also expected to increase, with global inventories projected at 41.188 MMT, up ~7.5% from the prior year. India is forecasted to increase its 2025/26 sugar production by ~19% to 35 MMT, aided by favorable monsoon forecasts and expanded cane acreage. Brazil’s Center‑South sugar output is expected to rise ~2.3% to 44.7 MMT.
Thailand is also expected to boost output, contributing to the surplus. Analysts at Green Pool, for example, project a shift from a prior sugar deficit to a modest surplus of 2.7 MMT in 2025/26. New York sugar #11 futures dropped to four-year lows amid bearish sentiment. London ICE white sugar contracts have also slid, reflecting weaker global demand expectations. In one recent session, July NY sugar fell —0.42 (–2.33%) and August London sugar fell —11.30 (–2.24%) on surplus concerns.
Demand Side
While consumption is expected to grow ~1.4% to a record 177.921 MMT, the increase may not be enough to absorb the oversupply. India’s move to allow 1 million metric tons (MMT) in sugar exports is expected to further weigh on global prices by releasing domestic surplus into international markets.
There is some counterpressure on prices from weaker output in Brazil’s Central‑South region year-to-date. Weather events or crop damage (e.g. droughts, flooding) could limit actual yields.
Shifts in sugarcane diversion to ethanol production could reduce sugar output. Policy interventions such as export quotas, subsidies, or trade barriers could distort flows.
Markets may remain bearish until supply is rebalanced or a shock disrupts output. Producers in high‑cost regions could struggle to remain viable. Governments might be pressured to support margins via tariffs, subsidies, or export incentives. Some sugar mills may pivot more aggressively into biofuels or value‑added sugar products to manage risk. With forecasts pointing to a considerable global sugar surplus, the major takeaway is that prices are likely to stay weak—barring an unexpected supply shock or policy intervention. Recent related news
