Sugar Prices Pulled Down by Abundant Global Supplies

On Thursday, sugar prices extended their losses amid reports indicating lower futures driven by a robust outlook for the sweetener’s supplies.

Sugar contracts for July delivery declined by -1.66% to $18.34 a pound on Thursday’s Asian afternoon session.

Solid production in Brazil is bringing down prices, as supplies jumped in the second half of April. The bearish outcome was caused by an 84.00% year-on-year increase to 1,843 million metric tons.

Moreover, for the country’s 2024/25 marketing year, harvests went up by 65.90% YoY to 2,558 MMT. Its sugar mills improved their cane crushing to beat 2023’s 41.42% of cane used, with this year’s 46.96% of sugarcane used.

On Wednesday, UNICA reported that outputs in the Centre-South region hit 1.84 million tons in the second half of April, up 84.25% from the same period last year.

However, the increase resulted from the drier conditions and is expected to be unsustainable at the end of the season.

In India, experts anticipated the 2024 monsoon season to be 106.00% of a long-term average of 87 centimeters, helping their sugar output.

On the other hand, record heat in Thailand can positively affect its sugarcane crops and bring prices up. Last Monday, it was stated that over three dozen of the nation’s 77 provinces experienced record-high temperatures in April. Also, its millers are reporting the lowest sugar cane yield in around 13 years.

Indonesia Strives for Higher 2024 Sugar Production

Indonesia hopes for strong sugar production, reaching 2.59 million metric tons, to be brought about by larger planting areas from last year’s harvest.

According to the Indonesian Sugar Association (AGI), white sugar production dropped by 4.00% to 2.30 million tons during a lengthy dry season.

Analysts said the target mirrors the country’s hope for self-sufficiency by 2028 for household consumption and industrial use by 2023.

As the US mentioned, Indonesia is currently the top sugar importer globally. The latter’s agriculture ministry noted that providing new land is vital for reaching sugar self-sufficiency.

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