New York March 11 World Sugar (SBH26) closed Tuesday down -0.13 (-0.87%), and London March 5 ICE White Sugar (SWH26) closed down -3.40 (-0.80%).
Sugar prices retreated on Tuesday due to a drop in crude oil prices. WTI crude oil (CLF26) sank to a 4.75-year low on Tuesday, undermining ethanol prices and may lead the world’s sugar mills to divert more cane crushing into sugar production instead of ethanol, thus boosting sugar supplies.
Sugar prices were already on the defensive since Monday, when the India Sugar Mill Association (ISMA) reported that India’s sugar production from October 1 to December 15 increased +28% year-on-year to 7.8 MMT.
The prospects for record sugar production in Brazil are also bearish for prices. Conab, Brazil’s crop forecasting agency, on November 4 raised its 2025/26 Brazilian sugar production estimate to 45 MMT from a previous forecast of 44.5 MMT. On Tuesday, Unica reported that Central-South Brazil’s cumulative sugar production in 2025-26 through November increased +1.1% year-on-year to 39.904 MMT. Furthermore, the amount of cane crushed for sugar increased to 51.12% in 2025/36 from 48.34% in 2024/25.
On the bearish side of sugar, the International Sugar Organization (ISO) on November 17 forecast a sugar surplus of 1.625 million MT in 2025-26, after a deficit of 2.916 million MT in 2024-25. ISO said the surplus is due to increased sugar production in India, Thailand and Pakistan. In August, ISO had previously forecast a shortfall of 231,000 tonnes for the 2025-26 marketing year. ISO forecasts a +3.2% year-on-year increase in global sugar production to 181.8 million tonnes in 2025-26. Meanwhile, sugar trader Czarnikow on November 5 raised its global sugar surplus estimate for 2025/26 to 8.7 MMT, +1.2 MMT higher than a September estimate of 7.5 MMT.
Signs of a larger sugar crop in India, the world’s second-largest producer, are undercutting prices after the India Sugar Mill Association (ISMA) on November 11 raised its 2025/26 Indian sugar production estimate to 31 MMT from a previous forecast of 30 MMT, an increase of +18.8% year-on-year. The ISMA also lowered its estimate for sugar used for ethanol production in India to 3.4 MMT from a July forecast of 5 MMT, which could allow India to increase its sugar exports.