Core Insights - Sugar prices have retreated, with NY sugar reaching a 5-year nearest-futures low due to increased sugar production forecasts in India and Brazil [2][4][5] Group 1: Sugar Production Estimates - The India Sugar Mill Association (ISMA) raised its 2025/26 sugar production estimate for India to 31 million metric tons (MMT), an increase of 18.8% year-on-year from the previous forecast of 30 MMT [2] - Brazil's crop forecasting agency, Conab, increased its 2025/26 sugar production estimate for Brazil to 45 MMT, up from 44.5 MMT [3] - Datagro projected Brazil's Center-South sugar production for 2026/27 to rise by 3.9% year-on-year to a record 44 MMT [4] Group 2: Sugar Price Trends - The recent month-long selloff in sugar has led to NY sugar prices hitting a 5-year nearest-futures low and London sugar prices reaching a 4.75-year low, primarily due to higher sugar output and expectations of a global sugar surplus [4] - Cumulative sugar output in Brazil's Center-South through mid-October rose by 0.9% year-on-year to 36.016 MMT, with sugar output in the first half of October increasing by 1.3% year-on-year to 2.484 MMT [5] Group 3: Global Sugar Surplus Projections - BMI Group projected a global sugar surplus of 10.5 MMT for 2025/26, while Covrig Analytics estimated a surplus of 4.1 MMT for the same period [4] - The outlook for higher sugar exports from India is expected to negatively impact sugar prices, as abundant monsoon rains have led to a potential bumper crop [6]

Core Insights - Sugar prices have experienced a significant decline, with NY Sugar closing down 3.05% and London sugar down 3.02%, reaching multi-year lows due to expectations of robust global sugar supplies [1][2] Supply Outlook - Brazil's Center-South sugar production for 2026/27 is projected to increase by 3.9% year-on-year to a record 44 million metric tons (MMT) [2] - Unica reported a 10.8% year-on-year increase in Brazil's Center-South sugar output in the second half of September, totaling 3.137 MMT [3] - Cumulative sugar output in Brazil's Center-South for 2025-26 through September rose by 0.8% year-on-year to 33.524 MMT [3] India’s Production and Export Potential - India's sugar production for 2025/26 is expected to rise by 19% year-on-year to 34.9 MMT, following a significant decline of 17.5% in 2024/25 [4] - The Indian Meteorological Department reported cumulative monsoon rainfall of 937.2 mm, which is 8% above normal, indicating a strong monsoon that could lead to a bumper sugar crop [4] - India may divert 4 MMT of sugar for ethanol production in 2025/26, which could lead to increased sugar exports, potentially reaching 4 MMT, exceeding earlier expectations of 2 MMT [5]

Core Insights - Sugar prices have recently increased due to a decline in the dollar index, leading to short-covering in sugar futures [2] - The global sugar supply outlook remains robust, with projected surpluses for the 2025/26 and 2025/25 seasons [2] Price Movements - March NY world sugar 11 closed up +0.11 (+0.70%) and December London ICE white sugar 5 closed up +0.50 (+0.11%) [1] - NY sugar reached a 3-week low earlier in the week, while London sugar hit a 4.25-year nearest-futures low [2] Production and Supply Factors - Brazil's sugar output in the second half of September increased by +10.8% year-on-year to 3.137 million tons [3] - The percentage of sugarcane crushed for sugar in Brazil rose to 51.17% from 47.73% year-on-year [3] - Cumulative sugar output in Brazil's Center-South region for 2025-26 through September increased by +0.8% year-on-year to 33.524 million tons [3] Indian Sugar Market Dynamics - India's monsoon rainfall was reported at 937.2 mm, 8% above normal, indicating a potential bumper sugar crop [4] - Projections suggest India's sugar production for 2025/26 could rise by +19% year-on-year to 34.9 million tons, following a significant decline in 2024/25 [4] - India's sugar mills may export up to 4 million tons of sugar, exceeding earlier expectations due to a surplus [5]

Market Overview - Sugar prices showed a recovery on Tuesday, with NY world sugar 11 closing up by 1.73% and December London ICE white sugar 5 up by 1.53% [1] - The initial decline in sugar prices was attributed to a weaker dollar and short covering in sugar futures, with NY sugar hitting a 3-week low and London sugar reaching a 4.25-year low [2] Supply and Production Insights - The global sugar supply outlook remains robust, contributing to downward pressure on prices, with BMI Group projecting a global sugar surplus of 10.5 million metric tons (MMT) for 2025/26 and Covrig Analytics estimating a surplus of 4.1 MMT for 2025/25 [2] - Brazil's sugar output has increased significantly, with a reported 15.7% year-on-year rise in the first half of September, totaling 3.622 million tons [3] - The percentage of sugarcane crushed for sugar in Brazil's mills rose to 53.49% in late August, up from 47.74% the previous year, although cumulative sugar output for 2025-26 through mid-September fell slightly by 0.1% year-on-year to 30.388 MMT [3] Regional Production Forecasts - India's sugar production is expected to rebound significantly, with a projected 19% year-on-year increase to 34.9 MMT for 2025/26, following a decline to a 5-year low of 26.2 MMT in 2024/25 [4] - The Indian Meteorological Department reported cumulative monsoon rainfall of 937.2 mm, which is 8% above normal, indicating favorable conditions for a bumper sugar crop [4] Export Dynamics - India's potential to divert 4 MMT of sugar for ethanol production in 2025/26 may not sufficiently alleviate the sugar surplus, leading to increased export expectations of up to 4 MMT, surpassing earlier estimates of 2 MMT [5]

Group 1: Sugar Price Trends - Sugar prices have extended losses, with NY world sugar 11 down by 0.30 (-1.80%) and December London ICE white sugar 5 down by 7.60 (-1.66%), reaching a 2-week low [1] - The decline in sugar prices is attributed to a projected global sugar surplus of +4.1 million metric tons (MMT) for the 2025/26 season [1] Group 2: Brazil's Sugar Production - Brazil's sugar output in the first half of September increased by +15.7% year-on-year (y/y) to 3.622 MMT, contributing to bearish market sentiment [3] - The sugar content in Brazil's Center-South sugarcane dropped to 154.58 kg/ton in the first half of September, down from 160.07 kg/ton a year earlier [2] - The percentage of sugarcane crushed for sugar by Brazil's sugar mills rose to 53.49% in the second half of August, compared to 47.74% the same time last year [3] Group 3: India's Sugar Outlook - India's cumulative monsoon rain as of September 30 was reported at 937.2 mm, 8% above normal, indicating a potential bumper sugar crop [4] - India's National Federation of Cooperative Sugar Factories projected a +19% y/y increase in sugar production for 2025/26 to 34.9 MMT, following a -17.5% y/y decline in 2024/25 [4] - Sugar trader Sucden indicated that India may divert 4 MMT of sugar for ethanol production in 2025/26, which may lead to increased exports of up to 4 MMT, exceeding earlier expectations of 2 MMT [5]