Could NY world sugar #11 (SBK25) Tuesday closed up +0.02 (+0.10%), and Could London ICE white sugar #5 (SWK25) closed down -1.90 (-0.34%).
Sugar costs Tuesday prolonged their week-long rally, with NY sugar posting a 3-week excessive and London sugar posting a 3-1/2 month excessive on indicators of decrease international sugar manufacturing. Nevertheless, sugar costs gave up most of their advance, with London sugar turning decrease on indicators of weak Chinese language sugar demand after China’s Normal Administration of Customs reported that China’s Feb sugar imports tumbled -97% y/y to twenty,000 MT.
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Final Thursday, Unica reported that cumulative 2024/25 Brazil Middle-South sugar output by means of February fell -5.6% y/y to 39.822 MMT. Additionally, the Indian Sugar and Bio-energy Manufactures Affiliation minimize its 2024/25 India sugar manufacturing forecast final Wednesday to 26.4 MMT from a January forecast of 27.27 MMT, citing decrease cane yields.
Sugar additionally has help as a result of power of the Brazilian actual (^USDBRL). On Tuesday, the actual rallied to a 4-1/4 month excessive towards the greenback, discouraging export promoting from Brazil’s sugar producers.
In the meantime, the Worldwide Sugar Group (ISO) on March 6 raised its 2024/25 international sugar deficit forecast to -4.88 MMT from a November forecast of -2.51 MMT, exhibiting a tightening market from the 2023/24 international sugar surplus of 1.31 MMT. Final Thursday, the ISO additionally minimize its 2024/25 international sugar manufacturing forecast to 175.5 MMT from a November forecast of 179.1 MMT. For its half, Inexperienced Pool Commodity Specialists on February 5 projected that the worldwide sugar market will shift to a surplus of +2.7 MMT within the 2025/26 crop 12 months from its estimate of a deficit of -3.7 MMT in 2024/25.
On the bearish facet for sugar was final Wednesday’s projection from advisor Datagro that 2025/26 Brazil Middle-South sugar manufacturing of 42.4 MMT, up +6% y/y. As well as, sugar dealer Czarnikow on February 27 projected Brazil’s 2025/26 sugar manufacturing would climb to a document 43.6 MMT since producing sugar is extra worthwhile than ethanol.
In a bearish issue, the Indian authorities mentioned on January 20 that it might enable its sugar mills to export 1 MMT of sugar this season, easing the restrictions positioned on sugar exports in 2023. India has restricted sugar exports since October 2023 to keep up satisfactory home provides. India allowed mills to export solely 6.1 MMT of sugar through the 2022/23 season to September 30 after permitting exports of a document 11.1 MMT within the earlier season. Nevertheless, the India Sugar Mills Affiliation (ISMA) initiatives that India’s 2024/25 sugar manufacturing will fall -17.5% y/y to a 5-year low of 26.4 MMT.
The outlook for increased sugar manufacturing in Thailand is bearish for sugar costs. On October 29, Thailand’s Workplace of the Cane and Sugar Board projected that Thailand’s 2024/25 sugar manufacturing would soar by +18% y/y to 10.35 MMT. Thailand produced 8.77 MMT of sugar within the 2023/24 season that led to April. Thailand is the world’s third-largest sugar producer and the second-largest sugar exporter.
Drought and extreme warmth final 12 months triggered fires in Brazil that broken sugar crops in Brazil’s prime sugar-producing state of Sao Paulo. Inexperienced Pool Commodity Specialists famous that as a lot as 5 MMT of sugar cane might have been misplaced as a result of fires. Conab, Brazil’s authorities crop forecasting company, minimize its 2024/25 Brazil sugar manufacturing estimate from November 21 to 44 MMT from a earlier forecast of 46 MMT, citing decrease sugarcane yields attributable to drought and extreme warmth.
The USDA, in its bi-annual report launched November 21, projected that international 2024/25 sugar manufacturing would climb +1.5% y/y to a document 186.619 MMT and that international 2024/25 human sugar consumption would enhance +1.2% y/y to a document 179.63 MMT. The USDA additionally forecasted that 2024/25 international sugar ending shares would decline -6.1% y/y to 45.427 MMT.
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Reference :
https://www.nasdaq.com/articles/sugar-prices-extend-recent-gains-outlook-lower-global-production