Sugar Prices Retreat on a Forecast for a Global Sugar Surplus

Core Insights - Sugar prices have experienced a significant decline, with March NY world sugar closing down 2.04% and December London ICE white sugar down 1.59%, reaching a two-week low due to a projected global sugar surplus of 4.1 million metric tons (MMT) for the 2025/26 season [1] Group 1: Brazil Sugar Production - Brazil's sugar output in the first half of September increased by 15.7% year-on-year to 3.622 MMT, contributing to bearish market sentiment [3] - The sugar content in Brazil's Center-South sugarcane crushed in the first half of September fell to 154.58 kg/ton, down from 160.07 kg/ton a year earlier, indicating lower sugar quality [2] - Cumulative sugar output for the 2025-26 season through mid-September decreased by 0.1% year-on-year to 30.388 MMT [3] Group 2: India Sugar Production and Exports - India's sugar production for the 2025/26 season is projected to rise by 19% year-on-year to 34.9 MMT, following a significant decline of 17.5% in the previous season [4] - The Indian Meteorological Department reported cumulative monsoon rainfall of 937.2 mm, which is 8% above normal and the strongest in five years, potentially leading to a bumper sugar crop [4] - India may divert 4 MMT of sugar for ethanol production in 2025/26, which could lead to increased sugar exports of up to 4 MMT, exceeding earlier expectations of 2 MMT [5]