Sugar Prices Pressured by a Stronger Dollar

Core Insights - Sugar prices experienced mixed movements, with NY world sugar closing down slightly while London ICE white sugar saw a minor increase, influenced by a rally in the dollar index which pressured sugar futures [1] Group 1: Market Dynamics - Sugar prices initially rose due to expectations of index-related buying for annual commodity index rebalancing, with Citigroup projecting inflows of $1.2 billion into sugar futures contracts over the next week [2] - Last Monday, NY sugar reached a 2.5-month high based on expectations of reduced future sugar supplies from Brazil, with a forecasted production decrease of 3.91% to 41.8 million metric tons (MMT) for 2026/27 [3] - Sugar prices fell to two-week lows due to indications of increased sugar output in India, where production for 2025-26 surged by 25% year-on-year to 11.90 MMT [4] Group 2: Supply and Export Trends - India's food secretary indicated potential for additional sugar exports to alleviate domestic supply issues, with a quota allowing mills to export 1.5 MMT in the 2025/26 season [5] - Brazil's crop forecasting agency raised its sugar production estimate for 2025/26 to 45 MMT, contributing to a bearish outlook for sugar prices [6] - The cumulative sugar output in Brazil's Center-South region increased by 1.1% year-on-year to 39.904 MMT, with a higher ratio of cane crushed for sugar [6]