Can Sugar Rally?

Core Insights - World sugar futures experienced a 4% increase in Q3 2025 but were down 16.4% for the first nine months of the year, settling at 16.10 cents per pound on September 30, 2025 [1] - Sugar prices have been in a consolidation range, primarily between 16 and 17 cents per pound, following a significant decline from a high of 28.14 cents per pound in November 2023 to a low of 15.44 cents per pound in July 2025 [4][6] - The sugar market has lagged behind other soft commodities like cocoa and coffee, which have reached record highs [5][6] Price Trends - Nearby ICE world sugar futures were trading at 16.28 cents per pound and have shown relative stability since early August 2025 [2] - The continuous ICE world sugar futures contract closed 2024 at 19.26 cents per pound, indicating a significant drop in prices over the following months [3] Market Dynamics - Sugar prices have declined over 45% from their November 2023 high, while other soft commodities have seen price increases due to various factors including adverse weather and rising production costs [6] - The bullish case for sugar prices includes rising production costs, potential upward price movement from the current consolidation phase, and increased demand due to changing regulations on sugar substitutes in the U.S. [7]