Sugar Prices Retreat on the Outlook for Ample Global Supplies

Core Insights - Sugar prices have declined significantly, with London sugar reaching a new 4-year low and NY sugar hitting a 4.25-year nearest-futures low due to increased sugar production in Brazil [2] Group 1: Sugar Production and Supply - Brazil's Center-South sugar output in the second half of August increased by 18% year-on-year to 3.872 million tons, with the percentage of sugarcane crushed for sugar rising to 54.20% from 48.78% the previous year [2] - Cumulative sugar output for the 2025-26 season through August fell by 1.9% year-on-year to 26.758 million tons [2] - The International Sugar Organization (ISO) forecasts a global sugar deficit of 231,000 tons for the 2025/26 season, an improvement from a 4.88 million ton shortfall in 2024/25 [4] Group 2: Global Sugar Market Dynamics - Expectations of abundant sugar supplies are bearish for prices, with commodities trader Czarnikow projecting a 7.5 million ton global sugar surplus for the 2025/26 season, the largest in 8 years [5] - The USDA projects global sugar production for 2025/26 to increase by 4.7% year-on-year to a record 189.318 million tons, with ending stocks rising by 7.5% year-on-year to 41.188 million tons [5] - India's sugar mills may export up to 4 million tons of sugar, exceeding earlier expectations of 2 million tons, due to a potential bumper crop from abundant monsoon rains [3][6]