July NY world sugar #11 (SBN25) Friday closed up +0.22 (+1.39%), and August London ICE white sugar #5 (SWQ25) closed down -7.30 (-1.51%).

Sugar costs on Friday settled combined.  Brief overlaying emerged in sugar futures on Friday after Pakistan’s authorities introduced plans to import 250,000 metric tons of uncooked sugar as a consequence of a disappointing sugarcane harvest.  The greenback’s weak point (DXY00) on Friday additionally prompted some quick overlaying in sugar futures.

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Sugar costs have fallen over the previous 3-months and posted 4-year nearest-futures lows on Wednesday as a consequence of expectations of a world sugar surplus.  On Could 22, the USDA, in its biannual report, projected that international 2025/26 sugar manufacturing would improve by +4.7% year-over-year (y/y) to a report 189.318 million metric tons (MMT), with a world sugar surplus of 41.188 MMT, up 7.5% year-over-year.

The outlook for greater sugar manufacturing in India, the world’s second-largest producer, is bearish for costs.  On June 2, India’s Nationwide Federation of Cooperative Sugar Factories projected that India’s 2025/26 sugar manufacturing would climb +19% y/y to 35 MMT, citing bigger planted cane acreage.  The outlook for considerable rainfall in India might result in a bumper sugar crop, which is bearish for costs.  On April 15, India’s Ministry of Earth Sciences projected an above-normal monsoon this yr, with whole rainfall forecast to be 105% of the long-term common.  India’s monsoon season runs from June by September.  

Indicators of bigger international sugar output are destructive for costs.  On Could 22, the USDA’s Overseas Agricultural Service (FAS) predicted that Brazil’s 2025/26 sugar manufacturing would rise +2.3% y/y to a report 44.7 MMT.  Additionally, India’s 2025/26 sugar manufacturing is projected to rise +25% y/y to 35.3 MMT, citing favorable monsoon rains and elevated sugar acreage.  As well as, Thailand’s 2025/26 sugar manufacturing is predicted to climb +2% y/y to 10.3 MMT.

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 report 11.1 MMT within the earlier season.  Nevertheless, the ISMA tasks that India’s 2024/25 sugar manufacturing will fall -17.5% y/y to a 5-year low of 26.2 MMT.  Additionally, the ISMA reported final Monday that India’s sugar manufacturing from Oct 1-Could 15 was 25.74 MMT, down -17% from the identical interval final yr.  As well as, Indian Meals Secretary Chopra mentioned on Could 1 that India’s 2024/25 sugar exports could solely whole 800,000 MT, under earlier expectations of 1 MMT.

The outlook for greater sugar manufacturing in Thailand is bearish for sugar costs.  On Could 2, Thailand’s Workplace of the Cane and Sugar Board reported that Thailand’s 2024/25 sugar manufacturing rose +14% y/y to 10.00 MMT.  Thailand is the world’s third-largest sugar producer and the second-largest exporter of sugar.

Sugar costs have some help from decreased sugar manufacturing in Brazil.  Unica reported Monday that cumulative 2025/26 Brazil Middle-South sugar output by Could is down by -11.6% y/y to six.954 MMT.  Final month, Conab, Brazil’s authorities crop forecasting company, mentioned 2024/25 Brazil sugar manufacturing fell -3.4% y/y to 44.118 MMT, citing decrease sugarcane yields as a consequence of drought and extreme warmth.  

The Worldwide Sugar Group (ISO) raised its 2024/25 international sugar deficit forecast to a 9-year excessive of -5.47 MMT on Could 15, up from a February forecast of -4.88 MMT.  This means a tightening market following the 2023/24 international sugar surplus of 1.31 MMT.  ISO additionally reduce its 2024/25 international sugar manufacturing forecast to 174.8 MMT from a February forecast of 175.5 MMT.  

The USDA, in its bi-annual report launched Could 22, projected that international 2025/26 sugar manufacturing would climb +4.7% y/y to a report 189.318 MMT and that international 2025/26 human sugar consumption would improve +1.4% y/y to a report 177.921 MMT.  The USDA additionally forecasted that 2025/26 international sugar ending shares would climb +7.5% y/y to 41.188 MMT. 

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