World sugar #11 for March in New York (SBH26) today rose +0.10 (+0.69%), and white sugar ICE #5 for May in London (SWK26) fell -0.30 (-0.07%).
Sugar prices are mixed today, with New York sugar rising to a two-and-a-half-week high. The strength of the Brazilian real (^USDBRL) supports sugar prices. The real is up +0.33% today, just below the 1.75-year high reached on Monday against the dollar, discouraging export sales from Brazil’s sugar producers.
An excessive short position by funds in New York sugar futures could add fuel to a short-covering rally. Last Friday’s weekly Commitment of Traders (COT) report showed funds increased their short positions in New York sugar futures and options by 14,381 in the week ending February 17 to a record 265,324 net short positions (2006 data).
Signs of lower sugar production in Brazil also support sugar prices, after Unica reported last Wednesday that sugar production in South-Central Brazil in the second half of January fell 36% year-on-year to just 5,000 MT. However, the 2025-26 Central-South cumulative sugar production through January increased +0.9% year-on-year to 40.24 MMT. Furthermore, the proportion of cane crushed for sugar increased to 50.74% in 2025/26 from 48.14% in 2024/25.
On February 12, sugar prices plummeted to 5.25-year lows in near futures on concerns that a global sugar surplus persists. On February 11, analysts at sugar trader Czarnikow said they expect a global sugar surplus of 3.4 MMT in the 2026/27 agricultural year, following a surplus of 8.3 MMT in 2025/26. Additionally, Green Pool Commodity Specialists said on January 29 that they expect a global sugar surplus of 2.74 MMT by 2025/26 and a surplus of 156,000 MT by 2026/27. Meanwhile, StoneX said on February 13 that it expects a global sugar surplus of 2.9 MMT in 2025/26.
Consulting firm Safras & Mercado said on December 23 that Brazil’s sugar production in 2026/27 will fall -3.91% to 41.8 MMT from the expected 43.5 MMT in 2025/26. The firm expects Brazil’s sugar exports in 2026/27 to fall -11% year-on-year to 30 MMT.
The Indian Sugar Mills Association (ISMA) reported on January 19 that India’s sugar production in 2025-26 between October 1 and January 15 increased +22% year-on-year to 15.9 MMT. On November 11, ISMA 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, as India experienced its strongest monsoon season in five years. 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. India is the second largest sugar producer in the world.