Group 1: Sugar Price Movements - Sugar prices increased sharply on Friday, with March NY world sugar 11 closing up by 0.39 (+2.68%) and March London ICE white sugar 5 closing up by 10.20 (+2.44%) due to fund short covering ahead of a three-day weekend in the US [1] - On Thursday, NY sugar reached a one-month low, while London sugar fell to a two-month low, influenced by strong sugar production in India [2] Group 2: Production Reports - India's sugar production for the 2025-26 season is projected to rise to 15.9 million metric tons (MMT), reflecting a 21% year-on-year increase [2] - Brazil's cumulative sugar output for the 2025-26 season increased by 0.9% year-on-year to 40.158 MMT, with the ratio of cane crushed for sugar rising to 50.91% in 2025/26 from 48.19% in 2024/25 [3] Group 3: Market Outlook - The global sugar surplus outlook is negatively impacting prices, with Covrig Analytics raising its 2025/26 global sugar surplus estimate to 4.7 MMT from 4.1 MMT [5] - Future sugar supplies from Brazil are expected to decrease, with a projected decline of 3.91% in sugar production for 2026/27 to 41.8 MMT [6] - India's sugar production estimate for 2025/26 was raised to 31 MMT, an 18.8% year-on-year increase, which may enhance India's sugar export potential [7]

Group 1: Sugar Price Movements - March NY world sugar 11 increased by +0.20 (+1.35%) and March London ICE white sugar 5 rose by +2.40 (+0.56%) due to year-end fund short covering [1] - Sugar prices initially fell due to a rise in the dollar index, which impacted most commodity prices [1] Group 2: Brazil's Sugar Production Outlook - Brazil's sugar production for 2026/27 is expected to decline by -3.91% to 41.8 million metric tons (MMT) from 43.5 MMT in 2025/26, with exports projected to fall -11% year-on-year to 30 MMT [2] - Conab raised Brazil's 2025/26 sugar production estimate to 45 MMT from 44.5 MMT, indicating a bearish outlook for prices [5] - Cumulative sugar output in Brazil's Center-South region increased by +1.1% year-on-year to 39.904 MMT through November 2025/26 [5] Group 3: India's Sugar Production and Export Potential - India's sugar production estimate for 2025/26 was raised to 31 MMT, reflecting an increase of +18.8% year-on-year, with a significant production jump of +24% year-on-year to 11.83 MMT from October 1 to December 31 [3] - The Indian government may permit additional sugar exports to alleviate domestic supply issues, with a quota of 1.5 MMT allowed for the 2025/26 season [4] - The reduction in sugar used for ethanol production in India to 3.4 MMT from 5 MMT may enhance export capabilities [3]

Core Insights - Sugar prices are experiencing a decline due to increased production in India, with a reported 50% year-on-year rise in sugar production from October to November, reaching 4.1 million metric tons (MMT) [2] - Brazil's sugar production outlook is also bearish, with an increase in estimates for the 2025/26 season to 45 MMT, contributing to downward pressure on prices [3] - Recent developments indicate a potential shift in India's sugar production focus towards ethanol, which could further impact sugar supply dynamics [4] Group 1: Production and Supply Dynamics - India's sugar production has surged, with 424 mills crushing cane as of November 30, resulting in 46.8 MMT crushed, up from 33.4 MMT a year ago [2] - Brazil's Center-South sugar output increased by 8.7% year-on-year in early November, totaling 983 MT, with cumulative output for the 2025-26 season reaching 39.179 MMT, up 2.1% year-on-year [3] - The International Sugar Organization (ISO) forecasts a sugar surplus of 1.625 million MT for the 2025-26 season, driven by increased production in India, Thailand, and Pakistan [6] Group 2: Market Reactions and Price Influences - Sugar prices rallied to six-week highs recently due to concerns over tighter global supplies, although this was followed by a downward trend as production estimates were revised upwards [4] - India's food ministry's decision to allow mills to export 1.5 MMT of sugar in the 2025/26 season, lower than previous estimates, provides some support to sugar prices [5] - The potential increase in ethanol prices in India could incentivize mills to prioritize ethanol production over sugar, potentially reducing sugar supplies [4]

Price Movements - March NY world sugar 11 (SBH26) increased by +0.22 (+1.36%) and December London ICE white sugar 5 (SWZ25) rose by +5.10 (+1.13%) [1] Supply and Production Concerns - Sugar prices are rising due to concerns over lower sugarcane yields in Brazil, with Unica reporting a +6.9% year-on-year increase in Brazil's Center South sugarcane crush to 46 million metric tons (MMT) in the first half of September. However, the sugar content in the cane decreased to 154.58 kg/ton from 160.07 kg/ton a year earlier, indicating lower sugar production [2] - Brazil's Center-South sugar output in the first half of September rose by +15.7% year-on-year to 3.622 MMT, with the percentage of sugarcane crushed for sugar increasing to 53.49% from 47.74% the previous year. However, cumulative sugar output for the 2025-26 season through mid-September fell by -0.1% year-on-year to 30.388 MMT [5] Global Demand and Export Outlook - NY sugar reached a 1.5-month nearest-futures high, while London sugar climbed to a 1.5-week high due to stronger global demand, highlighted by Pakistan's order of 320,000 MT of sugar for immediate delivery [3] - The outlook for higher sugar exports from India is negative for sugar prices, as abundant monsoon rains have led to expectations of a bumper sugar crop. The cumulative monsoon rain in India as of September 30 was reported at 937.2 mm, which is 8% above normal and the strongest in five years [6] - India's National Federation of Cooperative Sugar Factories projected a +19% year-on-year increase in sugar production for the 2025/26 season to 34.9 MMT, following a -17.5% year-on-year decline in 2024/25 to a five-year low of 26.2 MMT [7] Market Trends - Last Tuesday, NY sugar hit a 4.25-year nearest-futures low, and London sugar reached a 4-year low, extending a seven-month downtrend due to expectations of abundant global sugar supplies. StoneX 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 [4]