Report Information - Report Title: Sugar Monthly Report [1] - Date: November 3, 2025 [2] - Research Team: Agricultural Products Research Team [4] - Report Theme: Repairing the Basis, Zhengzhou Sugar Shows Strength [5] Core Viewpoints - The peak production season in central - southern Brazil has passed, and the later crushing volume may gradually decline. However, India and Thailand are entering a new sugar - making season, so the supply pressure remains [8][57]. - With the raw sugar price falling below 15 cents, major global sugar - producing regions are in a loss state. But whether it will lead to production cuts is an issue for the next season and cannot improve the current sugar price [8][57]. - Market research institutions estimate that the sugar production in Guangxi for the 25/26 season will be around 6.7 million tons, an increase of about 0.5 million tons year - on - year [8][57]. - Downstream enterprises report weak demand due to the overall macro - economic situation and low enthusiasm for sugar procurement [8][57]. - Recently, Zhengzhou sugar has been significantly stronger than raw sugar. This is mainly because the Zhengzhou sugar 601 contract is approaching the delivery month. The large basis in the early stage and the early withdrawal of speculative short - position funds without delivery intention have led to a rebound in the futures price. It is a short - term structural market, and there is a lack of bullish support in the medium - term fundamentals [8][57]. Section Summaries 1. Futures Market Review - In October, the raw sugar index showed a continuous four - week decline and a downward - breaking trend, breaking through the 15 - cent and 14 - cent marks and approaching the lower Bollinger Band of the monthly line [14]. - The Zhengzhou sugar index showed a weak oscillation in October, with the price once falling below the 5400 mark and then rebounding and stabilizing. The rebound was stopped at the 10 - week moving average and the 40 - day moving average [14]. 2. Spot Market Conditions - In October, the spot price of sugar continued to decline. The spot price of Nanning sugar of Guangxi Nanhua Group dropped from 5810 yuan/ton at the beginning of the month to 5700 yuan/ton at the end of the month; the price of Kunming sugar in Yunnan dropped from 5710 yuan/ton to 5620 yuan/ton; the price of processed sugar in Rizhao, Shandong dropped from 5900 yuan/ton to 5870 yuan/ton [18]. - In October, the number of Zhengzhou sugar warehouse receipts plus effective forecasts continued to decrease. At the beginning of the month, there were 9464, and at the end of the month, it decreased to 8116. The registered warehouse receipts decreased from 9464 to 7530, and the effective forecasts increased from 0 to 586 [18]. 3. Futures Market Structure Analysis - In October, both futures and spot markets were weak. The spot market continued to weaken while the futures market oscillated horizontally, and the basis continued to shrink. The basis of the 2601 contract against the Nanning spot price decreased from 325 yuan/ton at the beginning of the month to 206 yuan/ton at the end of the month, and the basis of the 2605 contract decreased from 356 yuan/ton to 270 yuan/ton [22]. - In October, the spread between the main January contract and the secondary main May contract of Zhengzhou sugar widened significantly, mainly because the departure of short - position speculators in the near - month contract made the 01 contract stronger. The spread increased from 35 yuan/ton at the beginning of the month to 65 yuan/ton at the end of the month [22]. - In October, the spread between the London white sugar futures and the New York raw sugar futures main contracts widened, reaching 101 US dollars/ton at the end of the month. The current spread is at a slight profit level for raw sugar processing enterprises [25]. - As of September 23, the net short position of hedge funds and large speculators in raw sugar reached 125,628 contracts, a significant increase from the beginning of the month. Meanwhile, the total open interest in raw sugar futures decreased significantly to 898,935 contracts [25]. 4. Production and Sales Situation - As of the end of May 2025, the 2024/25 sugar - making season ended. The national sugar production was 11.1621 million tons, a year - on - year increase of 1.1989 million tons, or 12.03% [29]. - As of the end of May 2025, the cumulative sugar sales in the country were 8.1138 million tons, a year - on - year increase of 1.521 million tons, or 23.07%. The cumulative sugar sales rate was 72.69%, a year - on - year increase of 6.52 percentage points. In May, the single - month sugar sales were 869,200 tons, a year - on - year increase of 22,900 tons. The sales volume in May was relatively low compared to the same period in the past five years [31]. - At the end of May 2025, the national sugar industrial inventory was 3.0483 million tons, a year - on - year decrease of 322,100 tons, and it was at a relatively low level in the past five years [35]. 5. Import and Export Situation - In September 2025, the sugar import volume was 550,000 tons, a year - on - year increase of 150,000 tons. As of the end of September, the cumulative sugar import volume in the country for this sugar - making season was 4.63 million tons, a year - on - year decrease of 12 tons [39]. - In September, the total import volume of syrup and premixed powder was 151,400 tons, a year - on - year decrease of 135,100 tons. As of the end of September in the 24/25 season, the total import volume of syrup and premixed powder was 1.5283 million tons, a year - on - year decrease of 625,600 tons. In October, China suspended the import of all syrup and premixed sugar from Thailand, and policy optimization may suppress short - term imports [39][40]. - In October, the price of overseas raw sugar continued to decline, and the trend of Zhengzhou sugar was weakly oscillating, with the internal - external price spread widening. The processing profit of Brazilian raw sugar within the quota increased from around 1420 yuan/ton at the beginning of October to 1785 yuan/ton at the end of the month, and the processing profit outside the quota increased from around 193 yuan/ton to 678 yuan/ton [40]. 6. Production in Overseas Major Producing Countries - In the first half of October 2025, in central - southern Brazil, there were 255 production units in operation (3 less than the same period in the previous season). The sugar cane crushing volume was 34.037 million tons, a year - on - year slight increase of 0.30%. The sugar production was 2.484 million tons, a year - on - year increase of 1.25%. The proportion of sugar - cane used for sugar production decreased by 3 percentage points to 48.2%. The total ethanol production was 2.013 billion liters, a year - on - year decrease of 1.17% [45][47]. - As of October 16, 2025, in the 2025/2026 season in central - southern Brazil, the cumulative sugar - cane crushing volume was 524.957 million tons, a year - on - year decrease of 2.78%. The cumulative sugar production was 36.016 million tons, a year - on - year increase of 0.89%. The cumulative total ethanol production was 25.036 billion liters, a year - on - year decrease of 8.23% [48]. - Recently, the port logistics in Brazil has become increasingly tense. As of the week of October 15, the number of ships waiting to load sugar at Brazilian ports increased from 83 to 90, and the quantity of sugar waiting to be shipped increased to 3.7272 million tons, a 3.3% increase from the previous week [52]. 7. Exchange Rate Factors - In October, the US dollar index showed a strong oscillation. The Brazilian real depreciated slightly against the US dollar, and the Thai baht appreciated slightly against the US dollar [54]. - On October 29, local time, the Federal Reserve cut the federal funds rate target range by 25 basis points to 3.75% - 4.00% and decided to end the balance - sheet reduction from December 1 [55]. 8. Market Outlook - The supply pressure in the raw sugar market remains. Although the production in central - southern Brazil may decline, India and Thailand are starting a new season. The current low price may not lead to production cuts in the short term [57]. - For the domestic sugar market, the supply may increase, but the demand is weak. The recent strength of Zhengzhou sugar is a short - term structural phenomenon, and there is a lack of medium - term bullish factors [57].

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - International sugar prices face significant upside pressure, but the downside space below 15 cents per pound is expected to be limited unless new negative factors emerge. The domestic sugar market is expected to remain weak in the short term with limited fluctuation space, as it lacks pricing power and mainly follows the trend of the international market [2][20]. - The operation suggestion is to focus on short - term trading of Zhengzhou sugar futures [3][21]. Summary by Relevant Catalogs 1. Market Review - In October, Zhengzhou sugar prices first declined and then rebounded. After falling below the support level of around 5,400 yuan per ton under the drag of the international market, they recovered and returned above 5,400 yuan per ton. International sugar prices continued to decline in October, reaching a minimum of 15.03 cents per pound, due to the optimistic output prospects of major sugar - producing countries [5]. 2. International Market Analysis 2.1 Brazil - Brazil's recent bi - weekly production data is strong. As of October 1, 2025/26, the cumulative sugar production in the central - southern region was 33.524 million tons, a slight year - on - year increase of 0.08%. The bi - weekly sugar - making ratio has significantly decreased. The sugar - making ratio in the second half of September was 51.17%, compared with 53.49% in the first half of September. The average sugarcane yield per hectare in the central - southern region this season decreased by 6.5% compared with the previous season, but the recent yield data has improved. As long as Brazil's annual estimated sugar production does not exceed 42 million tons, it is difficult to trigger a new round of price decline [7]. 2.2 India - There are significant differences in India's new - year sugar production estimates. The Indian government is optimistic about sugar production due to sufficient early rainfall, and reservoir storage has increased significantly. However, heavy rain at the end of the monsoon in Maharashtra damaged nearly 2.83 million hectares of crops, and the sugarcane yield per hectare in this state has been revised down. The Indian government has estimated the new - year sugar production to be 34 million tons, and the industry generally expects 1 - 2 million tons of exports in the new season. Before the production data is clear, India is unlikely to export, so the short - term supply pressure from India is not large [11][12]. 3. Domestic Market Analysis 3.1 Production - Domestic beet sugar production has fully started, with the estimated output slightly lower than before. The sugar content in Inner Mongolia is higher than the same period last year, and 13 out of 14 sugar mills in Xinjiang have started production. The sugarcane - producing areas in Guangdong, Guangxi, and Yunnan have been affected by typhoons, which may lead to a decline in sugarcane yield and sugar content [14]. 3.2 Supply and Demand - The supply of refined sugar remains abundant, and the prices of refined sugar mills have been continuously lowered. In September, China imported 550,000 tons of sugar, a year - on - year increase of 150,000 tons. From January to September 2025, the cumulative sugar imports were 3.17 million tons, a year - on - year increase of 280,000 tons. The extrusion effect of refined sugar on domestic sugar sales is obvious, and the commercial inventories in Guangxi and Yunnan in September increased year - on - year, resulting in significant pressure on spot prices [16].

Core Viewpoint - The Ministry of Agriculture and Rural Affairs indicates that domestic sugar prices are expected to remain stable but weak, while international sugar prices are anticipated to fluctuate weakly [1] Domestic Market Summary - The 2025/26 sugar production season has commenced, with new domestic sugar gradually entering the market - A significant amount of imported sugar is also arriving in the domestic market, leading to supply pressure - Overall, domestic sugar prices are projected to trend weakly due to these supply dynamics [1] International Market Summary - Brazil is currently experiencing a peak in sugar supply, with other major producers like India and Thailand expected to increase production - Multiple institutions forecast a loosening supply-demand balance in the global sugar market for the 2025/26 season - Although macroeconomic factors may cause short-term price fluctuations, the fundamental supply abundance is expected to dominate the market, leading to weak fluctuations in international sugar prices [1]

Core Viewpoint - The sugar market is experiencing a shift with increased production forecasts from both Brazil and Thailand, leading to a potential oversupply in the global sugar market for the 2025/26 season [1][2]. Group 1: Market Data - As of October 22, the number of white sugar futures warehouse receipts in Zhengzhou Commodity Exchange is 8,313, a decrease of 63 from the previous trading day [1]. - The profit from producing white sugar using imported Brazilian raw sugar is approximately 1,865 CNY/ton (within tariff quota, 15% tariff) or 755 CNY/ton (outside tariff quota, 50% tariff) [1]. - The profit from producing white sugar using imported Thai raw sugar is about 1,780 CNY/ton (within tariff quota, 15% tariff) or 643 CNY/ton (outside tariff quota, 50% tariff) [1]. - Datagro forecasts Brazil's sugar production for the next season (April 2026 to March 2027) to be 43.2 million tons, up from the current season's estimate of 41.42 million tons [1]. - The global sugar market is expected to have a surplus of 1.98 million tons in the 2025/26 season, contrasting with a shortage of 5 million tons in the previous year [1]. Group 2: Institutional Perspectives - According to Everbright Futures, there are no rebound drivers for raw sugar in the near term, with production in the southern hemisphere largely determined and strong expectations for increased production in the northern hemisphere [2]. - The domestic spot market continues to clear inventory, with favorable rainfall in Guangxi leading to good cane growth, although autumn rainfall has resulted in lower sugar content in cane [2]. - The price of sugar is expected to remain weak, testing the support level of 5,400 CNY [2]. - Huawen Futures notes that the increase in domestic new sugar production, combined with external pressures, is likely to keep sugar prices on a weak trend, with attention on potential damage to new season cane in Guangxi and Yunnan [3].

Group 1 - The current spot price of white sugar in Guangxi is 5679 CNY/ton, with a slight increase of 7 CNY/ton [1] - The price range for Guangxi Sugar Group is adjusted to 5780-5860 CNY/ton, with mixed changes of 10-20 CNY/ton [1] - In Yunnan, the price range is 5690-5740 CNY/ton, while the main processing sugar factories maintain a price range of 5860-6050 CNY/ton [1] Group 2 - The national white sugar price list shows various prices, with food-grade sugar in Hubei priced at 6500 CNY/ton and industrial-grade sugar in Jiangsu and Anhui at 3000 CNY/ton [2] - The main futures contract for white sugar closed at 5489 CNY/ton, with a decrease of 0.51% and a trading volume of 56,988 contracts [2] Group 3 - In Inner Mongolia, 8 sugar factories have started production for the 2025/26 crushing season, with a delay of over ten days due to recent heavy rainfall affecting sugar beet quality [3] - The estimated sugar production in Inner Mongolia for the 2025/26 season is around 650,000 to 680,000 tons, remaining stable compared to the previous season [3] Group 4 - In Brazil's central-south region, sugar production in the first half of September increased significantly by 15.72% year-on-year to 3.622 million tons, with the sugar-to-ethanol ratio rising by 5.75% to 53.49% [4] Group 5 - The impact of recent typhoons on Guangxi's sugarcane production is significant, with areas like Chongzuo assessing damage and recovery [5] - Typhoon "Maidam" has severely affected the sugarcane in Zhanjiang, with overall damage reported to be worse than last year's Typhoon "Mojia" [5] - Despite the damage from typhoons, the increase in sugarcane planting area and overseas supply pressure may limit short-term price increases for sugar [5]

Core Viewpoint - The white sugar futures market experienced a slight decline, with the main contract dropping by 0.38% to close at 5496.00 yuan, following a rapid decrease that saw it hit a low of 5490.00 yuan [1][2]. Group 1: Market Analysis - Nanhua Futures indicates that the short-term upward momentum for sugar prices is limited due to the impact of recent typhoons on sugarcane production in Guangxi, despite an increase in planting area and overseas supply pressure [3]. - Guotou Anxin Futures emphasizes the importance of monitoring weather conditions and sugarcane growth, noting that production data from Brazil remains bearish, with an increase in sugar output year-on-year [4]. - Zhongcai Futures forecasts a period of price fluctuations for sugar, citing early sales in the current crushing season and low industrial inventory levels, while also highlighting the pressure from international markets and the need to observe raw sugar price trends [5].

Core Insights - Sugar prices have recently increased, with NY sugar reaching a 4-week high and London sugar a 1.5-week high, supported by a weaker dollar and stronger global demand, particularly from Pakistan's order of 320,000 MT of sugar for immediate delivery [1] Group 1: Market Trends - NY sugar futures hit a 4.25-year low last Tuesday, while London sugar reached a 4-year low, continuing a 7-month downtrend due to expectations of abundant global sugar supplies [2] - The International Sugar Organization (ISO) forecasts a global sugar deficit for the 2025/26 season, marking the sixth consecutive year of deficits, with a projected deficit of -231,000 MT, an improvement from -4.88 MMT in 2024/25 [5] Group 2: Production Insights - Brazil's sugar output increased by +18% year-on-year in the second half of August, totaling 3.872 MT, with the percentage of sugarcane crushed for sugar rising to 54.20% from 48.78% the previous year [3] - Cumulative sugar output in Brazil for the 2025-26 season through August fell by -1.9% year-on-year to 26.758 MMT [3] Group 3: Supply Dynamics - India may divert 4 MMT of sugar for ethanol production in 2025/26, which may not alleviate the country's sugar surplus and could lead to exports of up to 4 MMT, exceeding earlier expectations of 2 MMT [4] - Expectations for abundant sugar supplies are reinforced by projections of a 7.5 MMT global sugar surplus for the 2025/26 season, the largest in 8 years, and a record global sugar production forecast of 189.318 MMT, up +4.7% year-on-year [6]

Group 1: Sugar Production and Market Trends - Brazil's cumulative sugar output for the week of September 4, 2025, reached 2.9159 million tons, down from 3.8795 million tons in September of the previous year, with an average daily shipment of 145,800 tons, a decrease of 21.08% compared to last year's 184,700 tons [1] - The new sugar season in Inner Mongolia and Xinjiang has commenced, with expectations for new sugar to be available for sale next week, potentially putting pressure on the spot market [3] - The Brazilian sugar production ratio remains high for the 2025/26 season, significantly above historical levels, indicating a strong preference for sugar production among Brazilian mills [4] Group 2: Import and Pricing Dynamics - Pakistan has procured 80,000 tons of sugar through tender and is set to procure an additional 100,000 tons, indicating strong demand in the region [2] - The cost of Brazilian sugar imports is significantly lower than domestic prices in Guangxi, with quota-included sugar costing 4,482 RMB/ton (15% tariff) and quota-excluded sugar at 5,709 RMB/ton (50% tariff), showing a price difference of 1,408 RMB/ton and 181 RMB/ton respectively [2] - Domestic sugar market sentiment is cautious, with overall trading activity expected to remain weak as the holiday stocking period concludes [3][4]

Core Insights - Sugar prices have recently increased, reaching 1.5-week highs due to dollar weakness, which has led to short-covering in sugar futures [1] Group 1: Sugar Market Trends - NY sugar futures reached a 4.25-year low last Tuesday, while London sugar hit a 4-year low, continuing a 7-month downtrend driven by expectations of abundant global sugar supplies [2] - The International Sugar Organization (ISO) forecasts a global sugar deficit for the 2025/26 season, marking the sixth consecutive year of deficits, with a projected shortfall of -231,000 MT, an improvement from -4.88 MMT in 2024/25 [5] Group 2: Production and Supply Factors - Brazil's sugar output in the second half of August increased by +18% year-on-year to 3.872 MT, with the percentage of sugarcane crushed for sugar rising to 54.20% from 48.78% the previous year [3] - The USDA projects a record global sugar production of 189.318 MMT for the 2025/26 season, a +4.7% year-on-year increase, with ending stocks expected to rise by 7.5% to 41.188 MMT [6] Group 3: Global Supply Dynamics - India may divert 4 MMT of sugar for ethanol production in 2025/26, which may not alleviate the country's sugar surplus and could lead to increased exports of up to 4 MMT, exceeding earlier expectations of 2 MMT [4] - StoneX has projected a global sugar surplus of +2.8 MMT for the 2025/26 season, a shift from a deficit of -4.7 MMT in the 2024/25 season [2]

Market Review - On Thursday evening, white sugar futures fell by 0.05% to 5494 CNY/ton, while raw sugar rose by 0.99 the previous night [1] Fundamental Summary - The Indian Sugar and Bioenergy Manufacturers Association (ISMA) has urged the government to raise the minimum selling price (MSP) for sugar for the 2025-26 crushing season to at least 40.2 INR per kilogram, an increase of approximately 9 INR from the current level [2] - Stonex forecasts a global sugar surplus of 2.77 million tons for the 2025-26 season starting in October, compared to a shortage of 4.67 million tons for the 2024-25 season [2] - According to data from Brazilian shipping agency Williams, the number of ships waiting to load sugar at Brazilian ports was 76 as of the week ending September 24, down from 85 the previous week. The quantity of sugar waiting for shipment at ports was 3.1039 million tons, down from 3.2827 million tons the previous week [2] Institutional Views - Dongwu Futures indicates that Brazil is experiencing a supply peak, with a significant increase in sugar production in the second half of August, which continues to pressure sugar prices. The expectation of increased domestic production for the new crushing season remains unchanged, and the import of sugar syrup and premixed powder continues to rise, leading to increasing supply pressure. The traditional demand peak is nearing its end, with general domestic spot transactions, and futures prices are supported by inventory, expected to continue in a range-bound fluctuation [3] - Minmetals Futures notes that due to record high domestic imports in August and a significant year-on-year increase in sugar production in Brazil's central-south region, Zheng sugar has broken down, maintaining a bearish outlook on sugar prices. However, from a technical perspective, a significant increase in positions but a decrease in trading volume and narrowing price declines are unfavorable for further declines, suggesting a wait-and-see approach before the National Day holiday [3]