Couverture de Sugar Rush Over: Why Global Prices Keep Sliding Despite Rising Demand

Sugar Rush Over: Why Global Prices Keep Sliding Despite Rising Demand

Sugar Rush Over: Why Global Prices Keep Sliding Despite Rising Demand

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This is your Daily Sugar Price Tracker with Vanessa Clark podcast.

Welcome to the Daily Sugar Price Tracker with Vanessa Clark. I'm Vanessa, and today we're diving into what's happening with sugar prices in the global commodity market.

So here's what you need to know right now. Sugar traded at 13.59 US cents per pound on February 18th, up about 0.91 percent from the previous day. While that's a small gain, it's important context in a market that has been heavily pressured. Over the past month, sugar prices have dropped 9.42 percent, and year over year, we're down a significant 34.25 percent. That's a real story here.

The reason? Oversupply. The international sugar market is absolutely flooded right now. According to Trading Economics global models, we're looking at an estimated 13.41 cents per pound by the end of this quarter, and analysts expect prices to settle around 12.47 cents within 12 months. That's if current trends hold.

What's driving this oversupply? A few major things. First, India, the world's second largest sugar producer, is ramping up production. India's 2025 to 2026 sugar output from October through mid January is up 22 percent year over year to 15.9 million metric tons. The India Sugar Mill Association also raised its full year estimate to 31 million metric tons, up 18.8 percent, thanks to the strongest monsoon season India has seen in five years. India's government just approved an additional 500,000 metric tons of sugar for export on top of the 1.5 million metric tons approved in November. That's putting downward pressure on global prices.

Brazil, the world's largest producer, is also expected to hit record production. Brazil's 2025 to 2026 sugar output is forecast at a record 45 million metric tons. However, there is one bright spot. Sugar production in Brazil's second half of January dropped 36 percent year over year to just 5,000 metric tons, which did provide some price support this week.

The United States Department of Agriculture projects global 2025 to 2026 sugar production will climb 4.6 percent year over year to a record 189.318 million metric tons, while human consumption is expected to increase just 1.4 percent to 177.921 million metric tons. That supply demand imbalance is the core issue.

But here's something interesting. Asian exporters are reporting increased purchasing flows driven by post Ramadan restocking needs. That's providing at least some short term support to prices.

Where does this go from here? Analysts expect global sugar surpluses to persist. Czarnikow projects an 8.3 million ton surplus in 2025 to 2026, dropping to 3.4 million tons in 2026 to 2027. That means we could see some recovery eventually, but near term, the oversupply fundamentals remain very strong.

Thanks so much for tuning in to the Daily Sugar Price Tracker. Remember to subscribe and join us again tomorrow for the latest on what's moving commodity markets. This is Vanessa Clark, and we'll see you next time.

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