Sugar Prices Climb on Lower Brazil Sugarcane Yields

Core Insights - Sugar prices have increased sharply, with NY sugar reaching a 1.75-month nearest-futures high, supported by a decline in sugar content in Brazil's sugarcane crush [2][4] - Brazil's sugar output has shown mixed signals, with a year-on-year increase in the first half of September but a slight decline in cumulative output for the 2025-26 season [4] - India's sugar production outlook is bearish for prices, with expectations of a significant increase in production due to favorable monsoon conditions [5][6] Price Movements - March NY world sugar 11 is up by 0.32 (+1.94%) and December London ICE white sugar 5 is up by 6.90 (+1.51%) [1] - Last month, NY sugar hit a 4.25-year nearest-futures low, while London sugar fell to a 4-year low, extending a 7-month downtrend due to abundant global supplies [3] Brazil's Sugar Production - Brazil's Center-South sugar output rose by 15.7% year-on-year to 3.622 million tons in the first half of September [4] - The sugar content in crushed cane in Brazil dropped to 154.58 kg/ton in September from 160.07 kg/ton a year earlier, indicating potential lower production [2] India's Sugar Production Outlook - India's sugar production is projected to increase by 19% year-on-year to 34.9 million tons for the 2025/26 season, following a decline to a 5-year low of 26.2 million tons in 2024/25 [6] - The Indian Meteorological Department reported cumulative monsoon rain of 937.2 mm, 8% above normal, which is expected to contribute to a bumper sugar crop [5] Export Dynamics - India may divert 4 million tons of sugar for ethanol production in 2025/26, which could lead to increased exports of sugar, potentially reaching 4 million tons, exceeding earlier expectations [7]