Technical Short Covering Lifts Sugar Prices

Group 1: Sugar Price Movements - March NY world sugar 11 is up +0.16 (+1.12%) and December London ICE white sugar 5 is up +4.20 (+1.01%) after a three-week decline that pushed prices into oversold territory, leading to technical short covering in sugar futures [1] - Recent weeks have seen sugar prices under pressure, with NY sugar hitting a 5-year nearest-futures low and London sugar a 4.75-year low, primarily due to increased sugar output in Brazil and expectations of a global sugar surplus [2] Group 2: Brazil's Sugar Production - Brazil's Center-South sugar output in the first half of October increased by +1.3% year-on-year to 2.484 million tons, with the percentage of sugarcane crushed for sugar rising to 48.24% from 47.33% the previous year [3] - Cumulative sugar output for the 2025-26 season through mid-October rose +0.9% year-on-year to 36.016 million tons, contributing to downward pressure on prices [3] Group 3: 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 significant decline of -17.5% year-on-year to a 5-year low of 26.2 million tons in 2024/25 [4] - The Indian Meteorological Department reported cumulative monsoon rainfall of 937.2 mm as of September 30, which is 8% above normal, indicating a strong monsoon that may lead to a bumper sugar crop [4] Group 4: Export Dynamics - India's sugar mills may export as much as 4 million tons of sugar in 2025/26, exceeding earlier expectations of 2 million tons, due to a projected surplus and limited diversion of sugar for ethanol production [5]