Surging Crude Oil Pushes Sugar Prices Higher

Group 1: Sugar Price Movements - Sugar prices are currently rising but remain below the two-month highs reached earlier in the week, with May NY world sugar 11 up by 0.10 (+0.70%) and May London ICE white sugar 5 up by 0.50 (+0.12%) [1] - The surge in crude oil prices (+8%) is supporting sugar prices, as higher oil prices lead to increased ethanol prices, prompting sugar mills to shift production from sugar to ethanol, thereby reducing sugar supplies [1] Group 2: Global Sugar Surplus Forecasts - Analysts from Czarnikow predict a global sugar surplus of 3.4 million metric tons (MMT) for the 2026/27 crop year, following an 8.3 MMT surplus in 2025/26 [2] - Green Pool Commodity Specialists expect a 2.74 MMT global sugar surplus for 2025/26 and a smaller surplus of 156,000 MT for 2026/27 [2] - StoneX forecasts a global sugar surplus of 2.9 MMT in 2025/26 [2] Group 3: Production Trends - The International Sugar Organization (ISO) forecasts a sugar surplus of 1.22 MMT in 2025-26, driven by increased production in India, Thailand, and Pakistan, with a projected 3.0% year-on-year rise in global sugar production to 181.3 million MMT [3] - Brazil's sugar production in the Center-South region fell by 36% year-on-year in the second half of January, although cumulative output through January rose by 0.9% year-on-year to 40.24 MMT [4] - India's sugar output from October 1 to February 28 increased by 12% year-on-year to 24.75 MMT, with projections for the 2025/26 season set at 29.3 MMT, also a 12% increase year-on-year [5]